Cuba

Cuba, the largest of the Caribbean islands, boasts a respectable Human Development Index. Yet, the country is still suffering from the American embargo and from excessive foreign dependency, particularly when it comes to energy and food.
AFD has been present on the island since 2016, assisting the Cuban government in the key sectors of rural development, water and sanitation, energy, transportation, and health care.
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Havana street, Cuba
AFD and Cuba: Promoting Green, Inclusive Growth
Havana street, Cuba

Supporting rural development

Farmland around Viñales, Cuba

Supporting Rural Development

While the agricultural sector employs nearly 20% of the working population, it represents only 4% of GDP. Cuban farming is vulnerable to extreme weather events (cyclones, El Niño, La Niña) and rising international food and fuel prices. The performance of the sector as a whole has collapsed over the past decades due to the difficulty of importing farming inputs and equipment. 

As a result, the country imports 70% to 80% of its food needs. The rural population, particularly young people, is moving to urban areas or leaving the country entirely. It is essential to improve food security by improving agricultural productivity and diversifying local production.

The ability of cooperatives and farmers to access credit is another key factor in developing the sector. In fact, current transformations in the agropastoral sector are giving farmer cooperatives an increasingly larger role, who now run 69% of all farmland (versus 31% for government entities). It is important to ensure that these small producers are updated on both production capacities and technologies.

AFD is working to increase agricultural production and reduce poverty in rural areas. Through the PRODEGAN project, co-funded with FIDA and the Cuban government, we are improving the income of nearly 11,500 dairy farms and cattle ranches as well as improving hygiene and productivity of downstream industries (dairies and slaughterhouses).
 

Improving water and sanitation services

eau, assainissement, Tanzanie

Improving Water and Sanitation Services

In Cuba, nearly 95% of the population has access to improved drinking water and sanitation services, but only 75% has access to a water supply network, and 10% to continuous service. Due to a lack of resources and investment, drinking water distribution and sanitation services experience little advancement. Water quality is a real problem for both people and the environment.

In order to guarantee water access to as many people as possible and improve water and sanitation services, AFD is assisting Cuba in renovating the water and sanitation infrastructures damaged by Hurricane Irma in September 2017. We provide support to build the intervention capacity of the public companies responsible for operating and maintaining these services by improving their resiliency in the face of extreme weather events.

Other projects, including improving sanitation in Havana and drinking water and sanitation services in Cienfuegos, are currently being considered.
 

Developing renewable energy

Sugar cane processing plant in Cienfuegos

Developing Renewable Energy

As Cuba is still heavily reliant on fossil fuels (96% of the energy mix), it also suffers from high levels of dependency on its historical partners. With only 48% of oil produced locally, Cuba is subject to high supply costs. 

However, Cuba has a great deal of relatively untapped potential for renewable energy: solar power from sunny year-round weather, wind, biomass from bagasse (the fibrous matter that remains after sugar cane is processed), as well as wood and marabú resources.

To meet the growing demand for energy, the country plans to develop green energy sources and improve energy efficiency while reducing the cost of the energy consumed. The energy development plan for 2030 aims to increase renewable energy to 24% of the national mix.

The country has only recently begun experimenting with renewable energy and needs support and guidance in this area, which is one of AFD’s missions in Cuba.
 

Modernizing transportation

Luyano train repair workshop in Havana

Modernizing transportation

Inadequate transportation services and infrastructures in Cuba represent a serious barrier to the mobility of not only its residents, but also of its tourists, with tourism representing an huge sector the country's economy. This lack of infrastructure and transportation services also impedes on the exchange of goods, which includes transportation of the 18 million tons of sugar cane produced each year. 

The rail network, which covers more than 8,000 km, started to be built in the 1830s during the Spanish colonization and was the first network in Latin America. It was developed along the entire length of the island, connecting the country’s eight ports, and is ideally suited to Cuba’s geography and to transporting its main goods. 

The government has launched a massive program to renovate the rail system in order to improve quality of service, reliability, and safety so that the network can effectively facilitate the country’s economic and social development.

AFD is supporting the modernization of maintenance workshops by renovating buildings and equipment, acquiring needed equipment and materials, and bringing some unused locomotives and passenger cars back into service. The aim of these efforts is to restore Cuban rail service and enhance its competitiveness.
 

Updating public health infrastructures

hospital Monkole, Kinshasa, tubes, health, RDC

Updating public health infrastructures

Health care has been a priority for Cuba ever since the Revolution. Today, the Cuban health care system is globally renowned for its results, the quality of training among practitioners, and its free, universal access to care. It is a strategic sector in terms of both effective public policy and economic influence, through the export of medical services.

However, obsolete medical equipment and infrastructure conditions limit the care available. AFD is therefore helping to modernize nephrology departments, develop analysis, diagnostic, and monitoring capacity for infectious diseases, as well as improve health and environmental monitoring capacity within the country by acquiring equipment and training personnel.
 

2016
Start of AFD’s activities in Havana
132.9
million euros committed since AFD began its work

Cuba, the largest Caribbean island, has a population of 11.2 million.76.9% of the population lives in urban areas and 19.4% is over the age of 60. According to the United Nations Human Development Index (HDI), the island ranks 67th among 188 countries. This ranking reflects the high quality of public health care and education services, where social and demographic indicators are comparable to those of developed countries. 

Heavily impacted by the American embargo, the country has many challenges to face in a unique economic and political context. It is still heavily reliant on imports, especially food imports, which make up 70% to 80% of all food consumed, and thus, reliant on its historical partners. Cuba is currently looking to attract more traditional foreign direct investors (FDI) to ensure its food security, meet the growing demand for energy while moving its energy mix towards green energy, and even get its telecommunications up to speed.

As an island nation located in a cyclone belt, it is also particularly vulnerable to the effects of climate change and extremely exposed to natural disasters, as witnessed with Hurricane Irma in 2017. 

AFD is supporting Cuba in achieving “green, inclusive growth” through dialog about the country’s low-carbon trajectory (Tarea Vida) and based on a road map developed jointly with local authorities. The highest priorities are the country’s water and sanitation, health care, and transportation infrastructures, with a focus on supporting rural development and emphasizing renewable energy. 

AFD’s involvement in Cuba is the first by an OECD member country’s development bank since the Havana office officially opened its doors in October 2016.
 

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