Former Cuban officials get prison terms for corruption

Reuters News
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Posted: Aug 21, 2012 2:59 PM
Former Cuban officials get prison terms for corruption

By Marc Frank

HAVANA (Reuters) - Three former vice ministers in Cuba's Basic Industry Ministry and nine nickel industry executives have been sentenced to long prison terms for corruption, Cuban state media said on Tuesday.

The officials and a former head of negotiations for Cubaniquel, the state-run nickel company, received sentences ranging from six to 12 years for "crimes associated with corruption during the negotiation, contracting and execution of the expansion of the Pedro Soto Alba (nickel) plant," in eastern Cuba, according to the Communist Party newspaper Granma.

The plant, the largest of three nickel processing plants in Holguin province, is a joint venture between the government and Canadian mining company Sherritt International Corp.

There was no mention of Sherritt in the report and company officials were not immediately available for comment.

Cubaniquel and Sherritt also are partners in a Canadian refinery in Fort Saskatchewan, Alberta, where output from the Pedro Soto Alba plant is shipped for processing, then marketed by another joint venture between them.

The nickel plant in Cuba underwent a major expansion during the last decade to boost output from 32,000 metric tons per year to an expected 38,000 metric tons in 2012.

The case is one of a number of high level corruption probes, covering just about every sector of the Cuban economy, undertaken by President Raul Castro since he took over for his ailing brother Fidel in 2008.

Several foreign companies doing business in Cuba have been shut down and their top executives detained or jailed in the campaign against corruption, which is so extensive on the island that Castro has termed it a threat to the socialist system.

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The Cuban nickel industry has been the subject of a number of investigations over the last few years as output declined.

Two years ago police dragged several officials involved in the scandal away in handcuffs from their offices in Havana, causing consternation among employees.

Soon afterwards, police began arresting nickel executives in Moa, Holguin, heart of the nickel industry.

The three vice ministers included Alfredo Rafael Zayas Lopez, who served in that capacity from 2004 to 2007, Ricardo Gonzalez Sanchez (2001-2004) and Antonio Orizon de Los Reyes Bermudez (1980-1999). Respectively, they received sentences of 12 years, 10 years and eight years.

The Cubaniquel executive, Cristobal Saavedra Montero, was sentenced to six years in prison. The eight other executives received sentences of up to eight years, Granma said.

Cuba is one of the world's largest nickel producers and the Caribbean island supplies 10 percent of the world's cobalt, according to the Basic Industry Ministry.

Cuba's National Minerals Resource Center reported that eastern Holguin province accounted for more than 30 percent of the world's known nickel reserves, with lesser reserves in other parts of the country.

Nickel is Cuba's leading export product and its third largest hard currency earner after the export of medical services and tourism. The government has not reported annual production of unrefined nickel plus cobalt since output dipped well below 70,000 metric tons in 2010.

Cuba produced 70,100 metric tons in 2009 and 70,400 metric tons in 2008, after averaging between 74,000 and 75,000 metric tons during much of the decade.

Nickel is essential for producing stainless steel and other corrosion-resistant alloys. Cobalt is critical in the production of super alloys used for such products as aircraft engines.

Cuban nickel is considered to be Class II, with an average 90 percent nickel content.

(Editing by Jeff Franks and Anthony Boadle)