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6. DAMAGES TO OTHER SECTORS OF THE NATIONAL ECONOMY

There are countless examples of the privations and difficulties faced by the Cuban people for more than 40 years.

These also include among them:

- The U.S. company Lifeline Technology is the sole manufacturer of vaccine vial monitors (VVMs). In 1999, as a result of the participation of one of its scientists in the Havana Biotechnology Conference, the company received a letter from the OFAC, reminding it of the prohibition on all commercial, financial or travel-related transactions with Cuba.

Moreover, despite the fact that the World Trade Organization acted as an intermediary to get the Treasury Department to authorize the sale of VVMs to Cuba, the authorization was not given. As a result, UNICEF was unable to sign contracts with Cuba for the purchase of the Cuban hepatitis B vaccine in 2003, due to the lack of the above-mentioned monitors.

- Havana Club rum has been one of the national brands most severely affected by the policy of blockade. The adoption of Section 211 of the Omnibus Appropriations Act for 1999 in the United States, passed through the use of rigged measures with the support of legislators closely linked to anti-Cuban interests, robbed the Cuban-French joint venture Havana Club Holding of its rights to register and potentially market this brand of rum in the United States.

The losses incurred through the impossibility of selling the rum in U.S. territory are estimated at roughly 38 million dollars. In addition, 625,000 dollars were spent on legal expenses in the commercial dispute with the Bacardí company to defend the right to use the Havana Club brand name internationally.
Added to this is the U.S. State Department's seizure of payments for sales to clients in third countries, when the funds involved passed through U.S. banks and were consequently confiscated.

- The laws of the blockade obstruct Cuba's access to financing from multilateral and regional development agencies. During the 2002 fiscal year, the World Bank and Inter-American Development Bank approved loans for projects in Latin America in the amounts of 4.3658 billion dollars and 4.548 billion dollars, respectively. If Cuba had the possibility of receiving such loans, it could have obtained roughly 200 million dollars in 2002, which would have allowed it to execute important social and infrastructure projects, such as the renovation and technological upgrading of public health care facilities, to cite just one example.

- The LABET Tropicalization Laboratory, the only one of its kind in Cuba and the entire Latin American and Caribbean region, is unable to exchange experiences with its only counterpart in the hemisphere, Atlas Q-Lab (Material Testing Solutions), because the latter is a U.S. government laboratory. At the same time, the laboratory faces enormous difficulties in purchasing the equipment, disposable material, supplies and chemical reagents needed for its work, since these cannot be directly acquired in the U.S. market.

- The Cuban Radio and Television Institute (ICRT) purchases 95% of the products necessary for its activities at prices 20% to 30% higher than what they would cost if they could be bought from the main manufacturers and distributors, based in the United States. In 2002, the ICRT planned to buy four microwave links, which it attempted to acquire through Canada. When the manufacturer learned of the final destination, the sale was canceled, making it necessary to purchase the equipment in Europe at a much higher price.

- The Canadian company Cegerco refused to execute the Screen Wall project at the Parque Central Annex Hotel in Havana, claiming that it had a joint venture in the United States and its partners had informed it that they could not work with Cuba.

- The damages caused to the importing agencies of the Cuban Ministry of Construction between June of 2002 and April of 2003 are estimated at 7.8 million dollars. These resources could have been spent on the repairs of the 69,726 homes affected by recent natural phenomena (hurricanes and heavy rains) that have still not been completed, despite the efforts of the Cuban government, which has managed to repair 52,413 homes so far.

- In a project funded by the United Nations Development Program (UNDP) in the information technology sphere, executed in conjunction with the Genetic Engineering and Biotechnology Center (CIGB), the Canadian company Imaging Research Inc. refused to deliver software that had already been paid for, because its primary owner is a U.S. company.

- Despite the fact that roughly 80 cruiseships sail around the Cuban archipelago every week, traveling from ports in Florida to various destinations in the Caribbean and Central and South America, Cuba is denied the possibility of being included in regular itineraries with weekly stopovers in our ports, despite the interest expressed by more than one cruise line.

- The commercial branch of the Ministry of Transportation has suffered 96 million dollars in damages because of the prohibition on ships trading with Cuba from entering U.S. ports, the impossibility of using the U.S. dollar in business transactions, and the higher prices that must be paid to purchase equipment, among other limitations and prohibitions caused by the blockade.

- Since the year 2000, an electronic commerce project has been carried out in the city of Santiago de Cuba with the support of the International Telecommunications Union (ITU). The aim of the project is to make it possible for producers in the eastern region of Cuba to sell their goods and services through the Internet, primarily to countries in the Caribbean. The project has been brought to a standstill due to the lack of digital certificate technology, because the suppliers of this technology are U.S. companies and are thus prohibited from selling it to Cuba.

-Similarly, because it is unable to acquire the encryption technology necessary for electronic commerce, Cuba is prevented from fully participating in the program carried out by the International Telecommunications Union. A palpable example of these restrictions can be found at:

http://channels.netscape.com/ns/browsers/download/jsp

- The Cuban fishing industry has also suffered major losses as a result of the unjust measures imposed by the blockade. Between June of 2002 and April of 2003 alone, the quantifiable losses totaled over 3.67 million dollars. These funds could have been used to purchase 5.401 tons of fish for consumption by the population.

- The Cuban insurance and reinsurance sector has faced significant obstacles as a result of the dominance of U.S. capital in the financial market, which leads to delays in the execution of these operations, market restrictions, and increased costs due to the so-called "Cuba Risk". At the present time, 90% of the market of Lloyd's, the largest and most important international reinsurance firm, is concentrated in U.S. corporate capital, and consequently Lloyd's cannot operate with Cuba. This means a substantial limitation on the market available to the country and thus non-competitive fees.

The reinsurance operations of export credit insurance agencies reflect a similar situation. Insurance on exports to Cuba costs roughly 30% more than average rates, due to the control of the market by U.S. companies. As such, Cuba is forced to pay more for this protection.

- Because of the blockade, Cuba cannot purchase lubricants and additives, the primary raw material for the production of finished lubricants, directly from their producers. This leads to higher costs for imports. For example, in 2002, the Cuban company CUBAMETALES paid out an additional 8.6 million dollars, since the costs reached through credits granted with different traders ranged between 6% to 11% over the LIBOR (London interbank offered rate), while financial costs on the international market average around the LIBOR plus 2%.

- In the year 2004, all members of SWIFT (Society for Worldwide Interbank Financial Telecommunication) will have to adopt a change in technology in order to begin use of the SWIFTNet system, the new global infrastructure for secure messaging services. The connection will require equipment supplied by SWIFT known as M-CPE (Managed Customer Premises Equipment), needed by every user to access the Secure IP Network (SIPN) through a leased line (Reuters, for example). It will also require software known as SWIFTNet Link (SNL), which will permit access to SWIFTNet services on the SIPN.

The acquisition of the SNL Developers Toolskit will require the U.S. authorities to authorize SWIFT to provide Cuba with the corresponding security software, developed by them. This also applies to the acquisition of smart cards and their readers, technology that is supplied solely by a U.S. company called Datakey Inc.
For more than six months, the Banco Central de Cuba has been waiting for the above-mentioned authorization. If it is denied, all of the banks in the country would have to abandon this system, entailing significant costs, without even taking into account the expenditures already made for its installation.

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