WORLD TRADE  
ORGANIZATION  WT/L/742 
8 December 2008 
 
 (08-6030) 
General Council 
18-19 December 2008 Original:   Spanish 
 
 
 
CUBA – ARTICLE XV:6 OF THE GENERAL AGREEMENT ON 
TARIFFS AND TRADE 1994 
 
Report by the Government of Cuba under the  
Decision of 15 December 20061 
   The following communication, dated 3 December 2008, is being circulated at the request of 
the delegation of Cuba. 
 
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  Pursuant to the provisions of Article IX.4 of the Agreement Establishing the World Trade 
Organization (WTO), the Republic of Cuba s ubmits herewith the second annual report on the 
extension of the waiver approved on 20 Decem ber 2001 and renewed on 14 December 2006.  This 
waiver was granted to Cuba under the Decision of 14 October 1996 in relation to Article XV:6 of the 
General Agreement on Tariffs and Trade 1994 (GATT 1994).   The reason for the renewal of the extension of the waiver is the continued existence of the 
conditions which gave rise to its approval in 2001, albeit worsened by a further strengthening of the 
measures constituting the economic, commercial and financial blockade imposed on Cuba by the 
Government of the United States of America, in  the form of increased economic sanctions and the 
targeting of Cuban business activ ities and international financial transactions, including operations 
designed to pay Cuba's membership dues to international organiza tions, squatting on Cuban 
trademarks and reprisals against natural and legal persons with links to or which trade with Cuba, 
which make it impossible for Cuba to sign a special  exchange agreement with the Members of the 
World Trade Organization (WTO).   The blockade measures seek to:  
 - Deprive our country of its goods and services export earnings
:  Losses suffered by 
Cuban goods and services exports as a result of the blockade amounted to 
US$1,745.6 million in 2007. 
 
 - Increase the costs of Cuban imports :  Cuba has been forced to geographically relocate 
its trade and therefore incurs additional e xpenditure as a result of the increased prices 
of products purchased from remote markets, the use of intermediaries, higher freight 
and transport insurance costs and more one rous financing conditions.  Damage to 
imports during this period to talled US$956.2 million.  Total damage to Cuban foreign 
trade in 2007 exceeded US$2,701.8 million. 
 
                                                      
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   - Prevent or obstruct the country's access to external sources of funding
:  In the period 
since the submission of Cuba's most recent report last year, the United States has stepped up its targeting of all the count ry's international bank transactions and 
commercial operations.  The monetary and financial sector was severely hit by the 
ban on the use of the US dollar in Cuba's ex ternal transactions and by the implications 
of the country risk concept for the financ ing of Cuban foreign trade operations, given 
that, inter alia , the country has no access to funding from US banks or to international 
sources of financing. 
  The extraterritorial scope of the blockade measures encroaches on the sovereignty of third 
states and harms the legitimate interests of entities and individuals under their jurisdiction.  These 
measures prohibit:   - Subsidiaries of United States companies established in third-country markets from 
trading or carrying out any form of transaction with Cuban entities; 
 
 - third-country companies from exporting to the United States any product of Cuban 
origin or product containing Cuban inputs; 
  - third-country companies from selling to Cuba goods or services using technology that 
contains more than 10 per cent of United States components even where their owners 
are third-country nationals; 
  - ships carrying goods to or from Cuba from entering United States ports, irrespective 
of the country of registration; 
 
 - third-country banks from handling US dollar accounts for Cuban legal or natural 
persons or from carrying out financial tr ansactions in that currency with Cuban 
entities or persons. 
  The Government of the United States of Amer ica is thus pursuing the objective of harming 
the mainstay sectors of the Cuban economy to the great est extent possible, reinforcing restrictions and 
implementing regulations designed to impede Cuba's economic deve lopment.  Nevertheless, the 
Cuban economy was up 7.3 per cent in 2007 on the previous year, that is to say, the average annual growth rate as of 2000 is 6.3 per cent or 6.2 per cen t in per capita terms.  Almost all activities that 
make up GDP have seen genera lized economic expansion (with  services, which generated 
74.3 per cent thereof, being worthy of special mention), which confirms the process of economic 
recovery under way as of 1994.  Fiscal policy di splayed further proof of strength and strict 
management.  In the midst of unfavourable conditi ons, the State Budget continues both to support the 
country's social policy and to contribute to economic growth. 
  The monetary policy pursued by the Central Ba nk of Cuba has been directed towards the use 
of financial instruments to regulate the money supply.  The main monetary variables, such as inflation 
and the exchange rate, are stable, thereby bolst ering confidence in the Cuban financial system. 
  Great efforts were made in 2007 to secure st rategic development objectives without affecting 
the social programmes designed to raise the standard  of living of the population.  The most relevant 
social indicators of the year were: 
 
• The infant mortality rate reached its lowest  level in history of 5.3 per thousand live 
births. 
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  • Life expectancy at birth continued to be 78 years. 
 
• The unemployment rate dropped to a record low for the country of 1.8 per cent. 
 
• Around 44,700 students graduated from higher education institutions:  51.4 per cent 
in educational sciences, 18.8 per cent in medical sciences and 9.3 per cent in technical subjects. 
 
• Primary and secondary education for all has been guaranteed and the number of 
pupils per classroom fell to 20 in primary e ducation and to 15 in secondary education. 
 
• Over the last four years, art teacher-training colleges have produced 
13,359 graduates, who will disseminate art and culture throughout the country and to 
all echelons of society. 
 
 In addition to such endeavours at national leve l, Cuba continued to extend its cooperation and 
support programmes in favour of broad-based soci al programmes in a considerable number of 
developing countries, basically in the areas of health and education.  Three million people in more than 27 countries have learned to read and write  through the Cuban literacy programme.  Cooperation 
in health care, involving around 37,500 Cuban doctors, technicians and health workers, has been 
extended to more than 70 countries. 
  This policy was maintained in spite of the difficult external conditions which the Cuban 
economy had to face in 2007 in the wake of the intern ational financial crisis triggered by the collapse 
of the US real estate sector, the marked devaluati on of the dollar and the rise in oil and food prices, 
which led to a significant deterioration in the terms of trade. 
  Cuba, a net food-importing country, closely monitors international fuel and food price developments.  The rise in food prices on the worl d market – as a result not only of the unprecedented 
hike in crude oil prices but also of the demand for grain for industrial use and speculation – has forced 
the country to make major financial sacrifices to ensure domestic food security, while the overall 
increase in commodity prices has not benefited those giving greater weight to their exports. 
  Furthermore, climate change and Cuba's e xposure to natural disasters has meant that its 
economy has a high level of vulnerability in the face of increasingly frequent and devastating 
weather-related catastrophes.  Between September and November 2008, Cuba was hit by 
three hurricanes, which caused substantive dama ge to the population and losses to the domestic 
economy estimated at more than US$10,000 million – particular damage being suffered by the road 
transport, electrical and communications infrastruct ures, housing and the agricultural sector – and it is 
likely that this will have negative impact on economic growth.  
 In addition to the foregoing are the detrimental effects of the blockade on the health and food 
sectors.  The adverse effects of the embar go measures on the production of food for domestic 
consumption in 2007 and early 2008 are estimated at  over US$174 million.  In turn, damage to the 
public health sector is calculated at more than US$25 million, given the increased costs involved in 
the purchase of products and equipment from more re mote markets and the use of intermediaries for 
such purposes. 
 
 The economic losses caused by the blockade up to December 2007 amounted to more than 
US$93 billion, adversely affecting all sectors of  the domestic economy and hindering the normal 
development of the country's external financial fl ows.  The international community has condemned 
the US policy towards Cuba for 17 consecutive year s.  In October 2008, the United Nations General WT/L/742 
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  Assembly adopted a new resolution condemning the blockade which, as in other years, had the 
support of the overwhelming majority of the Members of that Organization, with 185 votes in favour 
to three against and two abstentions.   Given its scope, its objectives – both officially declared and veiled – and the means used and 
action taken to achieve these, the blockade violat es the purposes and principles of the Charter of the 
United Nations, the principles of international law governing relations between sovereign states, and 
the principles of freedom of international trade and navigation enshrined in  numerous international 
legal instruments, including the WTO rules.  The blockade is, without a shadow of doubt, Cuba's 
major development constraint. 
 
 In these special circumstances, the applicati on of the provisions of Article XV:6 of the 
GATT 1994 would involve serious lega l and practical difficulties for Cuba – the same as those which 
gave rise to the extension of the waiver grante d to the country in December 2001 and renewed in 
December 2006. 
 
 Cuba hereby attests that none of the measures adopted during this period is at variance with 
the principles and objectives of the General Ag reement or has impaired the rights of other 
WTO Members.  Cuba confirms its willingness to con tinue to comply with the principles laid down in 
the General Agreement.  
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