Chinese VP in Cuba to meet on economic ties

Reuters News
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Posted: Jun 04, 2011 10:03 PM
Chinese VP in Cuba to meet on economic ties

By Jeff Franks

HAVANA (Reuters) - Chinese Vice President Xi Jinping arrived in Cuba on Saturday for a three-day visit expected to accelerate fast-growing economic relations between the two communist-run countries.

One of Cuba's six vice presidents, Esteban Lazo, was at Havana's Jose Marti International Airport to greet Xi, who is tipped to succeed Chinese President Hu Jintao in 2013.

Xi came to Cuba from Italy, where $3.2 billion in business deals were unveiled during his visit, and he was to go on to Uruguay and Chile.

China is in the midst of a massive expansion of economic activity in Latin America, where its trade last year totaled $180 billion, up 50 percent from 2009, official Chinese news agency Xinhua reported.

In a written statement to the press, Xi said he was in Cuba to "increase friendship (and) deepen cooperation" in pursuit of development.

Xi and President Raul Castro were scheduled to hold talks and preside over the signing of so far undisclosed accords on Sunday.

A Chinese official told Xinhua this week the two countries would begin negotiations on a five-year plan for bilateral economic cooperation.

China is Cuba's second largest trading partner, trailing only Venezuela, with trade between the two increasing to $1.83 billion last year from $440 million in 2001, according to Xinhua. The 2010 figure fell from $2.2 billion in 2008.

China has become the lender of last resort for debt-ridden Cuba, which is carrying out reforms to modernize and strengthen its Soviet-style economy.

Last year, China restructured debt believed to be as high as $4 billion and agreed to extend new credit in what Havana-based diplomats said was a show of support for Cuba's reforms.

In his statement, Xi praised a recent Cuban Communist Party congress affirming the economic changes, which are timid compared with the market economy China has embraced.

Castro, who succeeded ailing older brother Fidel Castro in 2008 and turned 80 on Friday, is slashing government payrolls, expanding the private sector, putting more agriculture in private hands and giving state companies greater autonomy.

He has said the goal is to make sure Cuban socialism survives once the current generation of aging leaders is gone.

China's involvement in Cuba's economy is increasingly evident, with Chinese-made goods filling the stores and Chinese buses and cars a common sight on Cuban roads.

A unit of China National Petroleum Corp is expected to begin work later this year on a $6 billion project to expand and upgrade an oil refinery in Cienfuegos on Cuba's southern coast, with plans including construction of a liquefied natural gas terminal.

China buys nickel, sugar and other products from Cuba and jointly produces pharmaceuticals in China.

After Sunday's meeting with Castro, Xi will visit a Havana medical clinic on Monday, then leave for Uruguay from the beach resort of Varadero on Tuesday.

(Additional reporting by Nelson Acosta and Marc Frank; Editing by Peter Cooney)