FOREIGN TRADE AND INVESTMENT IN CUBAPORTFOLIO OF OPPORTUNITIES 2016-2017

Foreign tradeForeign trade Cuba’s economy is open and highly dependent onforeign trade.
Founder member of GATT and belongs to the WTO.
Cuba is a signatory of the UN (Vienna) Convention on
Contracts for the International Sale of Goods.

More than 3,000 foreign companies are involved inCuban foreign trade.

CUBA HAS EXPANDED AND
DIVERSIFIED ITS ECONOMIC
RELATIONS
Increased exchanges in trade, finance,investment and cooperation.
Trade relations with over75 countries.
The trade has been tripled in thelast 10 years.
Active role in the Latin American
and Caribbean integration.

FOREIGN DIRECTINVESTMENTFOREIGN DIRECT INVESTMENT INCUBA
 The promotion of foreign investment is one of the mostimportant tasks in the process of updating the Cuban economicmodel.
 This statement is based on the importance of attracting
external resources through FDI, because domestic savings are
not enough to achieve accumulation rates over 20%, allowing
to increase steadily the growth rate of GDP.
 It has been estimated that to achieve growth rates of GDP from
5 to 7%, it is required to attract substantial foreign investment
flows annually.

In line with the recognition of foreign investment´
importance for economic development of the country, we
have taken actions to enhance it, such as:
The approval of the Foreign Investment Policy.
The creation of the Special Development Zone Mariel.
The approval of Law 118, Law on Foreign Investment, andthe issuing of its supplementary regulations.
The conformation of the Portfolio of Opportunities forForeign Investment.

Advancedtechnologies

Importsubstitution

Acces toexternalfinancingsources

Diversification ofexport markets

Energy matrix –renewable energy

Process of updating
the Cuban
economic model

New jobs

INVESTMENT ENVIRONMENTLEGAL FRAMEWORKINFRASTRUCTURE

INSTITUTIONSPolitical,
social andlegal stability

Uniquegeographic
location

Security

Highly skilledworkforce

Naturalresources

THE NEW LEGAL FRAMEWORK FOR FOREIGNINVESTMENT INCLUDES: Law No. 118/2014 “Law of Foreign Investment”.
 Decree No. 325/2014 “Regulations of the Law on
Foreign Investment”.
 Resolutions No. 46/2014 and No. 47/2014. Central
Bank of Cuba.
 Resolutions No. 128/2014 and No. 129/2014.
Ministry of Foreign Trade and Foreign Investment.
 Resolution No. 16/2014 and 42/14 Ministry ofLabour and Social Security.
 Resolution No. 920/14 Ministry of Economy
 Resolution no. 535/14 Ministry of Finance Agreement No. 7567 of the Council of Ministers inMay 2014.

It was published in
the Official Gazette of
the Republic of Cuba
(Special Issues No. 20and No. 53) from Apriland December 16th.,2014.

SOME PARTICULARS OF THE LAW
 Foreign investment may be authorized in all sectors except health andeducation to the population as well as the military sector. The exceptions
do not include their enterprise systems.
 Foreign investors can make their contributions in cash or in tangible andintangible assets.
 Foreign investments shall adopt one of the following modalities:

 Joint ventures
 Totally foreign capitalcompanies (subsidiary,branch office, naturalperson)
 International economic
association agreement

GUARANTEES TO INVESTORS The Cuban State shall see to it that the benefits granted to foreign
investors and their investments are maintained throughout theentire period for which they were granted.
 They enjoy all-out protection and legal security and could not beexpropriated, unless such action is executed for reasons of public
or social interest as previously stated by the Council of Ministers.
 The State shall guarantee foreign investors the free transfer abroad,in freely convertible currency, free from taxes or any other fees
associated to said transfer, of dividends or profits.
 They shall be protected against legal claims by third parties or theextraterritorial implementation of other States’ laws.
 The term of the authorization granted for the development ofoperations could be extended by the very authority that granted it.

SPECIAL TAXATION SYSTEM *TAXSPECIAL REGIME
LAW 118/2014

SDEZ Mariel

TAX SYSTEM ACT
LAW 113/2012

On Profits

0% for 8 years, andexceptionally for alonger period. Then 15%.
0% for reinvested
profits.
If natural resources areexploited, it can rise up
to 50% (maximum22.5%)

0% for 10 years andexcepcionally for a longer
period. Subsequently 12%.
Application of Law 118 forprofits reinvestment

35%

On using
labor force

Exempted

Exempted

Progressive reduction from20% (2012) to 5% (2016)

On importsofequipment,machineryand othermeansExempted for theinvestment process.

Exempted for theinvestment process

It is fixed in the Customs
TariffOn sales andservices

0% for the first year,
then 50% bonus onwholesale (1%) andservices (5%).

0% during first year ofoperations, subsequently
1%2% on wholesale and 10% on
services. New table items
shall be gradually
incorporated

SPECIAL TAXATION SYSTEM (*)
TAX

SPECIALREGIME
LAW
118/2014

SDEZ Mariel

On personal
incomes topartners orparties

Exempted

Law 118 applies

Land tax tocontribute tolocal
development

0% during
investment
recoveryEnvironment
al taxes

50%discountduringinvestment
recovery

TAX SYSTEM ACT
LAW 113/2012

15%

Exempted

It is gradually setting in the BudgetAct.

Law 118 applies

For the use of beaches, waste
disposal into hydrographic basins
and terrestrial waters: defined in the
Annual budget Law Use of bays andforestry resources according totaxable items in Law 113*Applies only to joint ventures and foreign partners
involved in International economic association agreement.
Excludes Totally foreign capital companies .

TAXES APPLICABLE TO TOTALLY FOREIGN CAPITAL COMPANIESProfit tax

35% that may go up to 50% for the exploitation of natural resources

Workforce tax

It is gradual reduce until 5% in 2016

Sales tax

5% on wholesale sales, 10% on retail sales.

Services tax

10% gradual application until 2016

Special products
and services tax

No tax is paid on sales, specially for products and on services for: goods
constituing raw material for industrial production; goods and services destinedfor export

Environmental tax

For the use or exploitation of beaches, approved waste disposal in hydrographic
basins , for the use or exploitation of bays,, forestry resources, the right to useterrestrial waters. Most of this taxes to be establish in the Annual Budget Law.

Territorialcontribution

Gradually established in the Budget LawCustoms

To be set in the Customs Tariffs

The projects included in the portfolio are allocated in
all provinces, including the special municipality of Islade la Juventud

The Special Development Zone Mariel has animportant weight in the portfolio of opportunities

PROJECTS BY SECTORS
395 Projects :Agro - Foods - 76 ( 1 in ZED Mariel) )Industrial sector- 16 ( 8 in ZED Mariel )Tourism – 114
Energy, including renewable energies – 23
Mining sector – 13
Transportation – 10Pharmaceutical and biotechnology - 15 ( 13 in ZED Mariel)Health – 3
 Construction – 10 ( 1 in ZED Mariel )Business – 7 ( 1 in ZED Mariel )Audiovisual – 3
Sugar industry _ 13
Oil _ 87
Hydraulic – 5

ZED MARIELOPEN TO THE WORLDPrivileged location on the crossing of the internationalcommercial maritime traffic axis.

PILLAR INDUSTRIES
They are interested in attracting companies of high and cleantechnologies.
The pillar industries for ZED Mariel: logistics services
 biotechnology and pharmaceutical industry
 advanced manufactures (food, packing and packaging,construction materials and technologies, steel transformationand consumer goods).
In order to achieve those objectives ZED Mariel has a particularregulatory framework and offers significant advantages to investors.

INVESTMENT MODALITIES IN ZED MARIELIn ZED Mariel investors can establish themselves as:

Foreign and Cuban
CONCESSIONAIRE

USER

Foreign investment operates under the three modalities:
Joint Venture
International Economic Association
100% Foreign capital Company
In ZED Mariel 100% foreign capital benefit from the Zone’s special taxation
regime, in equal conditions with the other investment modalities.

SUPPORT TO INVESTORSFAST APPROVAL SYSTEM
Only 2 levels of approval: The General Director of ZEDMariel’s Office and the Council of Ministers.
 The approval process takes from 35 to 65 days.

ONE STOP SHOP
 Processes all documents, licenses, permits andauthorizations on behalf of investors.
 Relieves the investor from bureaucratic loads.
OFFICE SUPPORT The Office has a team of professionals who assist theinvestor throughout the process of preparing andsubmitting the project, the investment process andits further operation.

USERSOficina de la Zona Especial de Desarrollo Mariel
Centro de Negocios Pelícano
3er Piso
Zona A-5, Sector A
Mariel, Artemisa
Tel. +53-47 397360 to 63
ventanillaunica@zedmariel.co.cu
www.zedmariel.com

SUMMARY Cuba strongly bets to use the benefits associated with foreign
investment to boost the development of its economic modeland achieve a prosperous and sustainable socialism.
 Important steps have been taken to stimulate the attraction offoreign capital and to promote the business environment in thecountry. We are committed to solve obstacles that may hinder
the fulfillment of ours goals.
 The Portfolio of Opportunities that we provide will be an useful
tool for authorities and entrepreneurs interested in developing
business in Cuba.

Investment Promotion Institutions
CHAMBER OF COMMERCE OF THE REPUBLIC OF CUBA
Address: Calle 21 no. 661 esq. a calle A, El Vedado, La Habana,
Cuba
Tel.: (53 7) 838 1321 / 838 1322 / 838 1452
E-mail: proinversion@camara.com.cu
Web: http://camaracuba.cu

CENTER FOR TRADE AND INVESTMENTSPROMOTION - PROCUBAAddress: Calle 10 no. 512 e/ 31 y 5ta. Ave., Playa, La
Habana, Cuba
Tel.: (53 7) 214 4345 / 214 4340
E-mail: sic@mincex.cu
Web: http://www.cepec.cu

BUSINESS DIRECTORYTHANK YOU!