- by Graham Holton
- The Guardian
- Issue #2192
Years of brutal sanctions have limited Cuba’s exploitation of its huge mineral resource wealth. Potentially it has one of the greatest concentrations of undeveloped natural resources in the Caribbean and Latin America worth more than US$1trillion.
The value of its mineral and petroleum resources is estimated at more than US$650 billion. Its agricultural output potential is worth more than US$33 billion annually. Cuba’s proximity to the United States is especially important for economic and shipping costs. Cuba would be a great prize if the Trump government were to take over and privatise the country’s natural resources and state-owned enterprises.
US sanctions, financial restrictions and political risk perceptions have created major barriers for foreign investment in Cuba. The country badly needs money to replace its aging infrastructure, lack of modern mining equipment, and end its energy shortages. Meanwhile Cuba remains a country with ‘high geological potential but low development intensity.’
Eastern Cuba has 5.5 million tonnes of nickel-cobalt reserves worth US$130 billion, ranking it amongst the world’s major producers. Cuba also has under-explored rare earth deposits, containing Neodymium, Lanthanum, Cerium, and Praseodymium, which are used in the manufacture of wind turbines, electric motors, missile guidance systems, and advanced electronics. These mineral deposits are worth at least US$30 billion. Cuba already possesses large iron, copper, chromium, manganese, and gold deposits which remain underdeveloped due to limited investment and infrastructure.
While Cuba already produces some onshore and shallow-water oil and gas, it has untapped offshore petroleum reserves in the North Cuba Basin, the Gulf of Mexico, where the US Geological Survey has identified significant potential oil and gas deposits worth more than US$420 billion. The under-explored offshore blocks are in deep water requiring special technology to produce. US sanctions, and the lack of drilling technology and finances, have severely limited their development. If sanctions were eased, and major oil reserves were proven, Cuba could become a major Caribbean petroleum producer.
Cuba’s agricultural potential is enormous with its fertile tropical soils and abundant rainfall. It has potential in sugar, tobacco, coffee, tropical fruits, rice, livestock and biotechnology-linked agriculture. Economists argue Cuba could become a major organic agriculture exporter, and a Caribbean food-processing hub. The agricultural potential is worth more than US$33 billion annually.
Its maritime and strategic geographic position is already capitalised by the Mariel Special Development Zone. Cuba has great potential in marine logistics, port development and shipping, as an energy transit, and for submarine cable networks. Old Havana and Varadero are globally recognised tourism assets. Cuba also possesses other major tourism spots, such as its beaches, coral reefs, biodiversity, music and cultural industries, preserved colonial cities, and its medical tourism.
Other nations are reluctant to make investments of hundreds of millions of dollars in a country targeted by US sanctions. With the proper investments and the removal of sanctions, Cuba could become the Caribbean’s jewel in the crown. Mining, oil and gas production, and increased agricultural output would create full employment and a booming economy. What Cuba does not need, but has far too much of, is bullying by the great power to its north.
