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CUBA RESPONSIBLE TURISM ISSUES- REPORT

CONTENTS

1. Introduction

2. Identification of the issues

2.1. People

2.2. Prosperity

2.3. Planet

3. Prioritisation of the issues

4. Justification

5. Recommendations

6. Conclusion

Bibliography

Appendix A United Nations. Transforming our world: the 2030 Agenda for Sustainable Development, Goals and Targets.

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CUBA, Tourism Issues

(Ciudad de la Habana, Cuba. Source, www.oneworld365.org)

1. Introduction

The Republic of Cuba is located in the northern Caribbean Sea at the

confluence with the Gulf of Mexico and the Atlantic Ocean. The country

consists of/is made up of the main Island of Cuba, the Isla de la Juventud and

many archipelagos such as Cayo Coco, Cayo Guillermo, Cayo Largo del Sur

andCayo Jutía, making a total territory of 110860 Km2. It is located 150 Km

away from Key West (Florida, USA), neighbouring The Bahamas (21 Km), Haiti

(77 Km), Jamaica (140Km) and the Cayman Islands. The Main Island, Cuba, is

1250 Km long, and is the largest island in the Caribbean.

The island is divided into 13 administrative provinces as shown on Figure 1 :

Pinar del Rio, Havana, Matanzas, Cienfuegos, Villa Clara, Sancti Spíritus,

Ciego de Ávila, Camaguey, Las Tunas, Bayamo, Holguín, Santiago de Cuba,

and Guantanamo. Those provinces are subdivided into municipalities, with one

special municipality, Nueva Gerona (Isla de la Juventud).

Figure 1.0. Large detailed administrative map of Cuba with cities and roads (Source, vidiani.com)

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Cuba has a subtropical climate with 2 differentiated seasons. From November

to April the dry season falls, with average temperatures of 18-28 ºC . The

humid season has average temperatures of 30 ºC and the risk of hurricanes is

mainly during June to November, with the risk of storms between September

and October.

Cuba is mainly flat and has some rolling plains with the exception of the Sierra

Maestra Mountains, at the South East of the Island with the highest point being

Pico Turquino at (1,974m). The island is home to an important biodiversity with

7,000 different flora species, more than half of which are endemic (i)

92% of the population in Cuba is educated to a high school education level,

and the national literacy is about 99.8% (Youngblood Coleman, 2014). Cuba

has a socialized healthcare system, being one of the most sophisticated

systems of health care in the Caribbean. The access to water and sanitation is

considered good although with limitations in some rural areas. About 13.60%

of the GDP is spent on education and 11.8% in Health Care (Youngblood

Coleman, 2014)

Cuba is a communist state, with a national constitution created in 1976

inspired by the Soviet political model, where the National Assembly and its

Council of State have supreme authority. The Communist Party is the only

recognized political party and it monopolizes all the government positions,

Council of State and judicial offices (“Cuba”, 1-Apr-2014, pp.8, 2015). The

Cuban constitution (1979) focuses on an economic system based on the

socialist property of the population in all the areas of production. The main

foundations of this political system are political freedom, social justice and

democracy, and individual and collective wellbeing. The government is acting

as the creator of policies, executor of justice and regulations, and control of the

nation´s economy (Yury Perez Martinez, 2012).

Development of the international tourism in Cuba has been led by a long

confrontation with the US, and restrictions on travelling to the island by both,

the USA and the Cuban government. The Cuban government's strategy in the

face of this confrontation was to prioritize the currency flow from other

international tourism markets. Tourism in Cuba can be split into three different

stages: before the success of the revolution in 1959, the boom of the nineties,

and the actuality. The first stage saw a growth but with a high dependence on

the US market, while in the second stage we noted a sustained increase in

tourism with a positive government attitude and action plans to use tourism to

develop the nation. The current, and third, stage in Cuba's development sees

the definite position of the country as a ' travel destination', and the concerns

that the country is facing in sustaining their tourism development goals.

(I) THE CUBA TOURIST BOARD (http://www.travel2cuba.co.uk/explore-cuba/general-information/)

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Since 1978, with the relaxation of internal policies by the Cuban government

towards Cuban expats who until now were not allowed to come back to the

island, There it´s been an important impact on the Cuban tourism industry. In

relation to the apparition of new products with specific packages directed to

this market, such as flight tickets combined with accommodation and car rental

(Jose Luis Perello Cabrera et la, 2015) and also to the increase of arrivals into

the island, resulted by the migratory mobility from Cuban nationals resident

abroad that also expanded the national tourism, as they are in many occasions

be bringing their families living in the island into their holiday. Research

undertaken by the University of Tourism in Havana states that from 2010 to

2014, Cuba received around 560,000 travellers yearly from the USA alone, of

which 90% were Cubans residents in North America (Jose Luis Perello

Cabrera et la, 2015).

Some studies in tourism development suggest that the travel and tourism

industry is the most important component of the Caribbean economy (Hayle

Singh et al, 2010). In the particular case of Cuba, in 2014, tourism represented

2.6% of the total GDP in Cuba with a direct contribution of CUP2, 023.6mn,

with a forecast to rise by 3.9% in 2015 and by 4.4% from 2015- 2025. The

direct government collective spending for this sector was, in 2014, 1,662.9

CUP mn (Jose Luis Perello Cabrera et la, 2015). These figures show the

possibility of the destination to grow and the aim for the government to develop

tourism in the upcoming years.

Cuba´s major competitor as a destination within the ranking of destinations in

the Caribbean is the Dominican Republic, as shown on the Figure 1.1. In the

period of time from 2007-2011 the Dominican Republic experienced a growth

of 7.03% income from tourism, whilst Cuba achieved only 5.03%.

Figure 1.1 Arrivals of tourist and income from tourism in millions of USD (Source: Miguel Alejandro

Figureras et la, 2015).

Due to the current empowerment of the government as a legislator,

administrator and enforcer of regulations and laws, together with the economic

importance of black market activity on the island, there is a large scope for

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corruption (The PRS Group, Inc “Cuba”, 1-Apr-2014, p.p.4, 2015).Corruption in

Cuba has always been a point of observation by international human rights

associations and fighters. It is believed to have been accepted since the

revolutionary party came into power, being initiated by its authority, and

socially assumed due to the lack of regulations (Ricardo A. Puerta, pp. 129,

2002). In 1997, the “El Codigo de Etica de los Cuadros Del Estado Cubano”

was created, which regulates the ethical code of the employees representing

the government in authority positions. Although this legislation was created, it

didn´t define actions and thus there is the belief that it is not being enforced.

This issue generates an uncertain atmosphere to attract foreigner investors

(Ricardo A. Puerta, 2002).

According to the World Wildlife Fund (WWF) report in 2006, Cuba has

achieved a sustainable development, due to the national achievement of

advances in literacy and education, health, culture, sports, social security and

per capita of the gross domestic product (Jose Antonio Suarez et al, pp.1,

2012). The country attended the Global Conference on sustainable

development of Small Island Developing states, led by the United Nations,

which took place in Bridgetown, Barbados from the 26th April to the 6th May

1994. This conference resulted in the Barbados declaration, which

recommended the General Assembly of the UN to adopt the Declaration of

Barbados and the programme of action for the sustainable development of

Small Island Developing states. All the participants and represented countries

recognized this Global conference and specific policies, to be taken into

actions and measures at a national, regional and international level to enable

Small Islands Developing States to achieve sustainable development (United

Nations, 1994).

The seasonality of Cuba as a sun and sand destination for incoming markets,

coupled with the effect that the US embargo has had on their economy, has

given Cuba an economic instability that impacts employment, waste

management, access to clean water and degradation of infrastructure.

The aim of this report is to highlight just some of the many issues in existence

in Cuba. They will be identified, scored following a criteria and justified

accordingly, giving a recommendation to address those issues.

2. Identification of the issues

The United Nations Sustainable Development Goals Agenda, 2030 (Appendix

A), was used to establish the issues found in Cuba as a destination, and to

assess the capability of the destination to develop responsibly towards tourism.

From the development goals, People, Prosperity and Planet were used as the

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main identifications, and will be explained and prioritized using the VERB

model in a later stage.

2.1 People

2.1.1 - Labour conditions and low productivity

As shown in Figure 1.2, 63% of the total workforce in the destination is focused

on the services sector, a fact that illustrates the importance of the role of the

tourism industry in the direct and indirect employment of the population. The

direct and indirect employment through tourism represents 7% of the total

national workforce (Miguel Alejandro Figueras et la, 2015). It is estimated that

about the 75% of the labour force is employed by the state, and The State

Committee for Work and Social Security, is in charge of setting the wages and

salaries for the state sector (The PRS Group, Inc “Cuba” , 1-Apr-2014, pp.5,

2015). The combination of the high rate of labour employed by the

government, the low salaries, limited competition within the sector, low

productivity and lack of quality services provided, has contributed to the

negative achievements in true development and growth. (Dr. Jose Luis Perello

Cabrera, 2015).

Figure 1.2 Total country work force distributions (source: The PRS Group, Inc “Cuba” 2015)

2.2 Prosperity

2.2.1- Seasonality

Cuba received a total of 151,916 international arrivals in 2014 and 193,493 in

2015 (ONEI, Oficina Nacional de Estadistica e Informacion Republica de

Cuba 2015). Canadians are the highest representation with 39.9%, (1 021 949)

of these total arrivals as seen in Figure 1.3.

Because of the nature of the international visitor markets, mainly Canadians

and Europeans, seeking “all-inclusive” beach holidays (Jose Luis Perello

Cabrera, pp.1, 2015), Cuba has been experiencing a very clear seasonality as

shown on Figure 1.4. Looking at this table, we can see that arrivals even at the

lowest point in September 2014, Cuba received twice as many tourists as the

highest point in March of the same year. The impacts of this seasonality are

far reaching, and touch even sectors such as agriculture and energy

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production. National production limitations on agriculture are hindering the

nation's ability to supply the high quantities of foodstuffs needed, while the

nation is becoming more dependent on petroleum imports to supply increased

levels of energy during the high season (M. Dawn King, 2012).

Figure 1.3 International Arrivals by Country (source: ONEI, Oficina Nacional de Estadistica e

Informacion Republica de Cuba, 2015)

Figure 1.4 –International arrivals by month (source: ONEI, Oficina Nacional de Estadistica e

Informacion Republica de Cuba, 2015)

2.2.2- Inflation and salaries

Cuba has a dual circulation of currency: 75% of the labour force is employed

by the state getting paid in CUP (Cuban peso), while the dual circulation of

currency means that many goods are sold in CUC (convertible peso), which is

believed to be worth approximately 23 times the Cuban peso, making the

access to many goods very difficult. This includes basic goods to be sold in

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CUC for the local population, and has generated a growth of the black market

(The PRS Group, Inc “Cuba”, 2015).

2.2.3- Foreign investment restriction

In 1995, the Foreign Investment Act was created by the National Assembly.

This is a legislation stand on accepting foreign investment but based on the

government approval, the foreigner company seeking to operate in Cuba

territory must demonstrate that its investment will provide an economic and

social benefit to Cuba. Foreigner enterprises must be as a joint venture with

the Cuban state that is in charge of the intervention towards the economic

leading for the society. The Cuban state acts as a shareholder and therefore

dictates the contract under which the investors can operate (Youngblood

Coleman, pp103, 2014)

There is a lack of reliable data provided by the Cuban government, but it is

estimated that currently exist 26 joint ventures resulted by foreign investment,

24 of which are in the hotel sector of the Tourism Industry in Cuba, with an

approximate value of $900 million (Youngblood Coleman, pp.103, 2014).

Investor tax rates are very high. These are imposed by the Council of Ministers

and vary in amounts. however in general rules they are among the erbhighest

in the world with a general income tax at 30% of the net taxable income (The

PRS Group, Inc “Cuba” , 1-Apr-2014, pp.1, 2015). Altogether with the current

restriction on foreign investment law that impose each project to be reviewed

and approved by the government, which any sector not considered a high

priority will remain effectively closed to investment, and the Helms–Burton Act

of 1996, that allow America to sue and punish foreign companies in US courts,

if they invest in properties confiscated from US citizens (The PRS Group, Inc

“Cuba”, 1-Apr-2014, pp.3, 2015)

2.3 Planet

2.3.1- Waste management and lack of water

Recent research identified soil degradation, deforestation, pollution, loss of

biological diversity and lack of water as the main environmental problems in

Cuba (Jose Antonio Suarez et la, 2012). It also mentioned as the major

challenge for future development the diversification of fossil energies,

energetic technologies suppliers, energy efficiency, use of renewable energy,

the protection of the environment developing research about adaptation and

mitigation of climate change, and the rational use of natural resources (Jose

Antonio Suarez et la, 2012).

The government created a strategy and policies for environmental protection

(NES), 1997; however the current economical situation has made the

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investment in infrastructure and research to achieve environmental

sustainability very difficult (Jose Antonio Suarez et la, 2012). There are existing

policies in place towards waste management within the tourism industry, but

those require extra organization and financial resources to make them work

efficiently (Jose Antonio Suarez et la, 2012). Currently 95.6% of the population

have access to safe water, although it is still insufficient to cover agricultural

and industrial needs, especially during the dry season, which also happens to

be the high tourism season (Jose Antonio Suarez et la, 2012).

2.3.2- Shortages of fuel and electricity

Infrastructure in Cuba is advanced, having 9 airports that can operate

international traffic, 11 main sea ports that can handle more than 27 million

tons of cargo and a road network considered among the most highly

developed in Latin America. Anyhow, there are frequent shortages of fuel and

electricity to the island, that don´t allow and the reconstruction and expansion

of the infrastructure networks (The PRS Group, Inc “Cuba”, 1-Apr-2014, pp.4,

2015).

The tourism sector consumes a huge amount of energy, and due to the

shortages of fuel and electricity the island as a whole suffers. The lack of

development of alternative energies has limited the planning of, and

investment in, new hotel constructions (Miguel Alejandro Figueras et la, 2015).

3. Prioritisation of the issues

As the UNWTO states,”The advancement of sustainable tourism is one which

establishes a suitable balance between the environmental economic and socio

cultural aspects of tourism” (UNWTO 2010, pp.24). Based on this statement,

we will assess the issues identified into these 3 categories, using the criteria

measured by their level of contribution to Cuba's sustainable tourism

development, and the level of difficulty in achieving a resolution to these

issues. The scores are given from 1 to 9, showing 1 as the most difficult to

achieve and with the highest contribution, and 9 being the easiest to achieve

and with the least level of contribution, towards sustainable tourism

development.

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SUSTAINABLE TOURISM DEVELOPMENT

Highest

Contribution

Inflation Labour Seasonality

Conditions

7 4 1

Middle Salaries Foreign Lack of water

Contribution

Investment restriction

8 5 2

Least Low productivity Waste management Shortage of fuel and electricity

Contribution

9 6 3

Easiest Middle Most Difficult

To achieve To achieve To achieve

4. Justification

4.1 Seasonality

Seasonality affects all the stakeholders. It puts pressure on the rest of sectors to be able to produce goods to cover the visitor´s needs, whose production levels are already limited in Cuba (M. Dawn King, 2012). It creates uncertainty in the job market and affects working conditions. It may also affect inflation during the high season, with the knock-on effect of the local population not being able to access basic goods. The environment is also under pressure, as it is not able to absorb the quantity of waste generated and it might impact on protected and natural areas, due to a overcrowding of visitors during the high season.

4.2 Lack of water

Lack of water is an important factor, due to the potential to cause health issues if the quantity of water is not enough to cover the basic needs of the local population, agriculture and industry. This will affect Cuba's internal economy and generate more dependency on international imports, which in turn may cause negative repercussions for the tourism industry, as the destination might

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be seen unsafe, and the prices may rise due to the country's need for foreign exchange.

4.3 Shortage of fuel and electricity

The current shortages of fuel and electricity that the island currently suffers, is affecting the possibility of development and maintenance of infrastructures. This might create safety issues on the existing infrastructures that affect both the visitors and the locals. The shortages also slow down the production and distribution of basic goods, which clearly cause production limitations affecting the national economy, as well as providing a limited range of products for tourists. It might also have repercussion on the population's health due to the limitation of good food refrigeration.

4.4 Labour conditions

Seasonality creates temporary working conditions, and the adaptation of working hours to cover tourism demand. It will certainly affect workers not having a balanced working and personal life, and may also lead to low job development opportunities, lack of motivation among the workforce and lower quality of service delivered, affecting the general economy and the competitiveness of the destination with others.

4.5 Foreign Investment restrictions

Foreign investment restrictions are currently affecting the economic growth of the country as the government does not have enough funds to invest in areas of essential development, such as infrastructure and technology investment for industries and research. In the specific case of tourism, it will also affect the lack of competition within the sector, and therefore also affect labour salaries, job opportunities and development of new products for the destination.

4.6 Waste management

The tourism industry, particularly hotels and hotel chains in Cuba, are attempting to develop strategies for efficient waste management, It currently doesn´t exist a defined or effective policy, neither methods to guarantee the reduction and impact made by inefficient waste management (Broche Fernández et la, 2010). These inefficiencies will have large contamination impacts on the environment at long term, if they are not controlled. They might also have an impact on the population´s health and also on the way tourists will see the destination, as dirty and unsafe, contributing negatively to the country's development.

4.7 Inflation

Easy access to goods by local people is of high importance for any society, and when rising prices make basic goods inaccessible for the local population,

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it has a huge impact for family economies, as well as negatively impacting the general country development.

4.8 Salaries

The dual currency system and the low salaries received by the local population, makes it very difficult for locals to purchase goods, in some cases basic ones for the household. This issue will slow economic development and will also make achieving true sustainable development very difficult.

4.9 Low productivity

Low productivity in industry and services will have a great impact on economic development, the access by the population and tourists to basic goods, and also the quality of services provided by the workforces. In a competitive market such as the tourism industry, tourists can develop a negative perception of the quality of the services provided by the destination, which contributes to a slowing down of the development of the destination.

5. Recommendations

5.1 Seasonality

Seasonality will require great attention and work by the public and private stakeholders (tour operators, government and private business), creation of new products to develop the destination in a more lineal path during the whole year i.e. through health tourism and nature packages. It will reduce the pressure on certain areas during the peak season and reduce the social impacts associated to the seasonality.

5.2 Lack of water

This is a very challenging issue that the public stakeholders have to face, through investment in maintenance and creation of new structures to ensure the global distribution and access to safe water for the population and industries to generate production and development. I would also recommend providing educational policies to educate society about the limited water resources, such as to consume water responsibly and avoid wasting it.

5.3 Shortage of fuel and electricity

Shortage of fuel and electricity is another issue that will mainly require attention by the government. The investment required by the public stakeholder is important to research renewable energies, low energy consumption policies, maintenance and creation of new infrastructures to guarantee power to the population and industries. Education to the population about how to save energy will also help to release the pressure on this area.

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5.4 Labour conditions

The government will play an important role in this case, due to the fact that the majority of the workforce of the country belongs to the government workforces. The creation of internal policies, the provision of career development opportunities, tackling the lack of motivation through training and setting up goals towards career development would be some of the recommendations to improve on current labour conditions. The private sector will also play a big role on the creation of opportunities, competition and labour working life balance.

5.5 Foreign Investment restrictions

The creations of new policies by the government are needed to allow foreign investment, so that the country can benefit and achieve a level of economic growth through the different sectors of the nation.

5.6 Waste management

Firstly through the conscious compromise by the government to protect the environment, creating policies and providing the infrastructures for recycling and waste destruction. Once this is planned, through educational lessons within communities, to train and engage the population in helping to protect the environment. The industries will also play a big role in putting the policies in practice and implementing them within the company, which they could do by seeking the contribution by its workforces, offering the training required, and even as an example through internal rewards for lowest waste generation within departments, teams or individually.

5.7 Inflation, salaries and low productivity

The implication of the public sector in this point and with the current political situation of the country is absolutely vital. The need to review the current working law and elimination of the dual currency will be a solution to make accessible the consumption of basic goods to the population, aligning the cost of living and salaries, generating competition and access to employment development. It will have also an impact on low productivity, as the workers will have some motivation to produce and provide a quality product, when they will be rewarded economically to help family economic development and access to cover their family basic needs.

6. Conclusion

Tourism is one of the main economic growth generators in Cuba, relying on their natural resources and limited infrastructures, which are highly impacted by the tourism flow. Cuba will need to consider strategies for achieving a sustainable growth by giving more priority to the maintenance and investment

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in solid infrastructure to reduce the impacts on their limited natural resources. The importance of creating new policies that guarantee the wellbeing of the population will mitigate some of the current issues, and will increase the attractiveness of the destination to international markets. Altogether, allowing the creation of new business will bring more internal competition and an opening up to new tourism products, which will allow Cuba in turn to develop more competition externally, with their neighbouring islands, growing a more sustainable tourism base that benefits the local population.

Bibliography

Broche Fernández, Yaleny, and Rafael Ramos Gómez. (2010). “Procedimiento Para La Gestión de Residuos Generados En Instalaciones Hoteleras Cubanas" (Spanish).” Procedure for Management of Studies Started in Cuban Hotel Facilities". (English) 9 (3): 13–19.

“Cuba”. (2015). PRS Group, Inc. http://ezproxy.leedsbeckett.ac.uk/login?url=http://search.ebscohost.com/login.aspx?direct=true&db=buh&AN=100605606&site=eds-live&scope=site.

Dr. C. Jose Luis Perello Cabrera. (2015). “Turismo Y Desrrollo Territorial En El Modelo Economico Y Social de Cuba”. TURyDES, June. Vol.8 N.18.

Hayle, Carolyn, Diaram Ramjee Singh, and Allan Wright. (2010). “Planning for Tourism Resilience in the Caribbean”. Journal of Eastern Caribbean Studies 35 (1): 36–59.

Jose Antonio Suarez, Pedro Anibal Beaton, Ronolddy Faxas Escalona, and Ofelia Perez Montero. (2012). “Energy, Environment and Development in Cuba”. Renewable and Sustainable Energy Reviews, 16 edition.

Jose Luis Perello Cabrera. (2015). “El Sector no estatal y su papel en el desarrollo del turismo cubano en un escenario de relaciones con Estados Unidos”, July 2015.

Jose Luis Perello Cabrera, and Laura Llanes Sorolla. (2015). “Movilidad Migratoria Y Flujos Turisticos. Interfaces En El Desempeno Turistico Cubano”. Mundi Migratios 3 (1): 48–72.

M. Dawn King. (2012). “Cuban Sustainability: The Effects of Economic Isolation on Agriculture and Energy”. Paper Presentation for the Western Political Science Association, March 21.

Miguel Alejandro Figueras, and Yenady Perez Cardenas. (2015). “Competitividad del destino turistico Cuba: Impacto Economico”. Economia y Desarrollo, no. 153 (Numero Especial): 178–89.

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http://www.one.cu/publicaciones/06turismoycomercio/llegadadevisitantes/mensual/2.pdf.

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Appendix A

Transforming our world: the 2030 Agenda for Sustainable Development (Source: “Transforming Our World: The 2030 Agenda for Sustainable Development: Sustainable Development Knowledge Platform” 2015) (United Nations:https://sustainabledevelopment.un.org/post2015/transformingourworld l[Accessed 20/11/2015]) The Goals and targets Will stimulate action over the next fifteen years in areas of critical importance for humanity and the planet: People We are determined to end poverty and hunger, in all their forms and dimensions, and to ensure that all human beings can fulfil their potential in dignity and equality and in a healthy environment. Planet We are determined to protect the planet from degradation, including through sustainable consumption and production, sustainably managing its natural resources and taking urgent action on climate change, so that it can support the needs of the present and future generations. Prosperity We are determined to ensure that all human beings can enjoy prosperous and fulfilling lives and that economic, social and technological progress occurs in harmony with nature. Peace

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We are determined to foster peaceful, just and inclusive societies which are free from fear and violence. There can be no sustainable development without peace and no peace without sustainable development. Partnership We are determined to mobilize the means required to implement this Agenda through a revitalised Global Partnership for Sustainable Development, based on a spirit of strengthened global solidarity, focussed in particular on the needs of the poorest and most vulnerable and with the participation of all countries, all stakeholders and all people. The inter linkages and integrated nature of the Sustainable Development Goals are of crucial importance in ensuring that the purpose of the new Agenda is realised. If we realize our ambitions across the full extent of the Agenda, the lives of all will be profoundly improved and our world will be transformed for the better”