It’s the solely communist nation within the Americas, was the primary within the western hemisphere to recognise the Folks’s Republic of China and is described by Beijing as “good brother, good comrade, good pal”.
However regardless of their shared political legacy — and what Washington says is a historical past of Chinese language spying exercise from Cuba — the island’s financial collapse has damage business ties with China simply as Beijing’s strategic rivalry intensifies with the Caribbean island’s arch-enemy, the US.
Chinese language commerce with Latin America has grown greater than tenfold over the previous twenty years and continues to surge: China has develop into the second-largest buying and selling companion for the area, after the US. However the import of Chinese language items to Cuba fell from $1.7bn in 2017 to $1.1bn in 2022, the final yr for which Cuban knowledge is out there.
The 2 nations don’t launch knowledge on Chinese language funding in Cuba, however Cuban economist Omar Everleny mentioned it amounted to a “laughably small” proportion of the roughly $160bn Beijing invested in Latin America and the Caribbean between 2005 and 2020.
Chinese language corporations concerned with state-backed offers had been owed massive sums by the Cuban state, mentioned folks briefed on the money owed. “The entire large state corporations like Huawei and Yutong are owed a whole bunch of tens of millions of {dollars} every,” mentioned an abroad businessperson who trades with the island.
Scant uncooked supplies and an unproductive economic system depart the island with little to export to China, whereas imports have diminished in recent times as hardened US sanctions severely aggravated Havana’s persistent late-payment issues and dried-up credit score traces.
Because the Covid-19 pandemic, sugar manufacturing on the island — as soon as a important trade — has plummeted to its lowest ranges in additional than a century: there’s barely sufficient sugar to cowl home necessities. That has resulted within the scrapping of a long-standing settlement to export an annual 400,000 tonnes of sugar to China.
“China isn’t Cuba’s sugar daddy,” mentioned Fulton Armstrong, former US nationwide intelligence officer for Latin America. “It’s largely a relationship of solidarity statements. It’s not a strategic relationship for both nation.”
Cuba right now doesn’t even function amongst China’s top-tier allies in Latin America. Beijing has what it calls “complete strategic partnerships” with Argentina, Brazil, Chile, Ecuador, Mexico, Peru and Venezuela, all main commodity exporters, however not with Cuba.
China publicly helps Cuba’s proper to decide on its personal path to financial improvement “according to its nationwide situations”, however privately Chinese language officers have lengthy urged the Cuban management to shift from its vertically deliberate economic system to one thing nearer to the Chinese language mannequin, in keeping with economists and diplomats briefed on the state of affairs.
Chinese language officers have been perplexed and annoyed on the Cuban management’s unwillingness to decisively implement a market-oriented reform programme regardless of the evident dysfunction of the established order, the folks mentioned.
The fraying of commerce ties varieties a stark distinction with latest many years. After greater than 10 years of utmost shortage after the Soviet Union collapsed, an inflow of imports within the early 2000s made such an affect that Chinese language manufacturers turned a part of the Cuban vernacular.
“Taking the Yutong” is now synonymous with “taking the bus” in Havana, whereas Cubans — consultants in gallows humour — baptised the a whole bunch of 1000’s of leaky Haier fridges imported as a part of Fidel Castro’s “Power Revolution” to enhance power effectivity as “Drippys”.
Cuba has been a member of China’s Belt and Highway international infrastructure improvement initiative since 2018 and China stays the island nation’s second buying and selling companion after Venezuela, which sends the nation oil in return for Cuban docs.
Beijing and Havana have a cyber safety settlement, and over the previous twenty years Chinese language teams Huawei, TP-Hyperlink and ZTE have put in fibre optic cables, WiFi hotspots and different digital infrastructure all through the island.
However Chinese language imports are “approach down . . . general”, mentioned one western businessman primarily based in Havana. “Exporters are shifting away from the China-Cuba credit score traces and shifting to the non-public sector.”
Cuba nonetheless exports nickel, zinc and luxurious cigars to China, leases docs in return for laborious foreign money cost, and co-operates on biotech.
Cuban President Miguel Diáz-Canel has twice visited Beijing and introduced again politically helpful handouts, together with medical gear in the course of the pandemic, a $100 million donation final yr and 1000’s of tonnes of rice donations this yr. However he has been unable to coax better financial integration.
“The Chinese language don’t give away a whole lot of charity,” mentioned William LeoGrande, professor of presidency at American College. “The Cubans proper now are ready the place they want charity, they usually don’t have a lot to supply in return.”
Beijing additionally has a a lot lower-profile safety relationship with Havana than does Moscow, which is brazenly targeted on Cuba’s geopolitical worth as an in depth neighbour of the US. Russian naval flotillas have docked in Havana twice this yr in a present of navy power. Russian commerce with Cuba has surged in recent times, pushed by US sanctions on each nations and the conflict in Ukraine.
There have been stories suggesting China has renewed efforts to reap the benefits of Cuba’s strategic location with digital eavesdropping stations on the island.
The Heart for Strategic and Worldwide Research, a Washington think- tank, mentioned in July there have been “rising indicators that China’s financial and political leverage could also be opening doorways for its navy and intelligence providers in Cuba”. US secretary of state Antony Blinken mentioned final yr that Chinese language spying operations in Cuba had been “a serious concern”.
However requested in regards to the CSIS report, a US state division official mentioned the Biden administration believed its “diplomatic outreach has slowed down [China’s] efforts to undertaking and maintain its navy energy around the globe”.
LeoGrande mentioned some in Florida and Washington had been eager to create a “Chinese language bogeyman in Cuba”. “It serves the pursuits of conservative Cuban-People, who’re at all times in search of causes to not enhance US-Cuban relations, and within the broader coverage neighborhood it serves the curiosity of those that assume that China is a world risk.”