The CUBA Facility is a project preparation tool fully funded by the European Union, under the Latin America Investment Facility (LAIF) budget, and implemented by AFD pursuant to a Delegation Agreement signed between the EU and AFD. 

It aims at financing studies and other activities related to investment projects that have been designated by the Cuban Government as priorities, in particular in the sectors of energy, water and sanitation, urban rehabilitation, agriculture and transportation. 

These investment projects are likely to be financed through long term loans, in particular loans from AFD and/or from other European development institutions. Signed in June 2017 for a 4 year implementation period, the CUBA Facility just entered with success its third year of implementation. 

With a € 3 million budget, out of which € 2.7 million for financing project preparation studies and € 300k for support activities, AFD already launched 3 studies and is currently preparing 2 others. These studies were supported by pre-feasibility activities and diagnosis financed from the budget for support activities, that facilitated the knowledge of the context and the preparation of the terms of reference of the studies.  

These 3 studies already launched are the following:

• “Feasibility studies of an investment project in the cane industry in the Cienfuegos region in Cuba” (€ 442 040- Beneficiary location: Cienfuegos region, Cuban Republic). This feasibility study is related to a project of improvement of the value chain from sugar cane production to the production of sugar and energy via a biomass plant.
• “Feasibility study of an investment in a wind farm project in Cuba and preparation of the tender” (€ 499,951 – Beneficiary location: under definition, Cuban Republic). This feasibility study assesses the feasibility of the development of a pilot wind farm in a place still to be determined (subject to the measurements foreseen in the first phase of the study).
• “Master plan water and sanitation of the city of Cienfuegos” (€ 499 965– Beneficiary location: Cienfuegos city, Cuban Republic) The study aims to support the preparation of the masterplan of water distribution and wastewater of the city of Cienfuegos.

A total of 6 studies will be covered at the end of the Facility implementation period, in an average amount of €450k each.

The volume of financing that is expected to be mobilised in the form of loans (from AFD and other donors) to the Cuban Republic for the financing of the underlying above projects is estimated  between € 350 and 400 million, which would represent a leverage effect of more than 100 times. Co-financing will be looked for in most of the projects, the main IFI able to provide long-term loans being CABEI, who is currently starting its activities in CUBA.

The content of this publication falls under the sole responsibility of the AFD and does not necessarily reflect the opinions of the European Union.