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10/05/09 - El Universal (Caracas) - Venezuela pays USD 5.6 billion for
Cuban staff in 2008

Data show that the Bolivarian government is the top subsidizer of Cuba's
economy

A new group of Cuban doctors is expected to arrive in Venezuela this month
to reinforce Barrio Adentro, a public health and welfare program that is one
of the main projects of Hugo Chávez's government.

The announcement was made by Venezuela's President Hugo Chávez, who
acknowledged that "we have a social emergency: health care."

There are 2,000 abandoned primary health care centers in Venezuela. This is
the reason why the government declared an emergency. What is the solution?
Asking for Cuba to send, this time, 1,111 doctors. What is the cost?
Authorities so far have not disclosed the cost of the program.

However, there are some calculations about the cost or investment made in
Cuban personnel in 2008. According to the estimates made by Cuban economist
Carmelo Mesa-Lago, based on figures provided by the Economic Commission for
Latin America and the Caribbean (ECLAC), and on statistics from the
Caribbean island, the Venezuelan government disbursed USD 5.6 billion in
2008, to pay doctors, nurses and other Cuban professionals working in
Venezuela.

Mesa, a visiting professor of Latin American Studies at Tulane University,
wonders: "What happened to all the Cuban doctors who were residing in
Venezuela and for whom the South American country paid that sum last year?
Where are those doctors?" According to Mesa, this is a "situation difficult
to explain."

The economist, a graduate from the University of Miami, goes on saying that
the Venezuelan government paid more than USD 5.6 billion to help Cuba.
According to his estimates, Venezuela paid USD 9.4 billion. This figure
includes, in addition to professional fees, USD 2 billion in oil subsidies
and more than USD 1.37 billion that Venezuela invested to fund 76 projects
in different sectors.

It is worthwhile to recall that under a number of agreements between the two
countries, a barrel of Venezuelan oil sold to Cuba has a preferential cost
of USD 27, and thanks to this preset value, the Caribbean island saved about
USD 2 billion. Mesa also refers to statistics from the University of Miami,
which show that the debt owed by Raúl Castro's government to Venezuela
amounts to USD 11.4 billion, out of which USD 4.6 billion are related to oil
shipments.

Unidirectional trade
In 2008, the total trade of the Caribbean island amounted to USD 17.9
billion. These figures, which were released in September 2009 in the Anuario
Estadístico de Cuba (Cuba's Statistical Yearbook), despite the fact that
they refer to results obtained last fiscal year, show that Venezuela
strengthened its position as Cuba's top trade partner.

Bilateral trade rose seven percentage points and stood at 27 percent.
However, in value terms (in US dollars) the increase amounted to 82 percent.
"Cuba exported to Venezuela USD 415 million and Venezuela sold USD 4.47
billion in goods to the island. This shows that we are talking of
unidirectional trade," Mesa said. According to the Cuban economist, it is
noteworthy that from the total deficit of the island in 2008 (USD 10.56
billion) the accumulated deficit with Venezuela represents 38 percent, which
amounts to USD 4.06 billion. "It is evident that Venezuela is subsidizing
Cuba's foreign trade. The question we may ask is how does Cuba pay more than
USD 4 billion in trade deficit?"

Mesa mentions the USD 5.6 billion disbursed by Chávez's government for Cuban
staff. This sum may be a part of the payment of the deficit. The Cuban
economist also recalls that "unfortunately, the balance of payments during
the years 2007 and 2008 is unaccounted for in Cuba's Statistical Yearbook."

The Cuban professor has no doubt that Venezuela is the main subsidizer of
Cuba's economy at the present time. "Venezuela's subsidy is higher in
nominal terms than any historical subsidy provided by the Soviet Union to
Cuba," he concludes.
maguzzi@eluniversal.com

Translated by Gerardo Cárdenas

María Gabriela Aguzzi V.