Qatar signs deal for new luxury hotel in Cuba
Wed May 6, 2009 11:42pm BST
HAVANA (Reuters) - Qatar and Cuba signed an agreement on Wednesday to build a $75 million luxury hotel on Cuba's Cayo Largo in the first major joint venture between the wealthy Gulf emirate and the communist island.
Construction on the 250-room project would begin next year with the aim of opening in 2012, they said.
The two state-owned partners, investment firm Qatari Diar and Cuba's Gran Caribe, said the five-star hotel could be expanded to 450 rooms. Sixty luxury villas are also planned.
Cayo Largo is an island in the Caribbean Sea off Cuba's southwestern coast.
Qatari Diar chief executive Ghanim bin Saad Al Saad said there was "great demand" for top quality hotels in Cuba, which drew 2.3 million tourists in 2008.
Since Raul Castro took over as president last year, Cubans have been permitted in hotels that were previously only for foreigners, but few can afford to stay in them because salaries average about $20 a month.
Al Saad and Gran Caribe president Luis Miguel Diaz Sanchez said the hotel was not being built with an American clientele in mind, although the U.S. government is loosening its longstanding ban on most U.S. travel to the island just 90 miles from Florida.
President Barack Obama recently lifted restrictions on Cuban American travel to Cuba and bills are pending in the U.S. Congress that would completely eliminate the ban that dates back to the Cold War.
The United States has had a trade embargo against Cuba since 1962 aimed at toppling the communist government installed by Fidel Castro after he took power in a 1959 revolution.
Al Saad said Qatar, which has the third-largest natural gas reserves in the world, views Cuba as ripe with investment opportunities and is looking at other possible projects, not all in tourism.
The Qatari company, which is a unit of the Qatar Investment Authority, has more than 80 projects worldwide worth in total about $60 billion, but intends to make Cuba one of its principal areas of activity, Al Saad said.
"Cuba has strong economic bases, above all in tourism," he said. "We want to send the clear message to the world that Qatar is at Cuba's side."
Qatar and Cuba have an agreement for Cuba, which regularly sends physicians to other countries, to provide medical staff and supervisors for a Qatari hospital. Al Saad said the two countries are also discussing possible agriculture ventures.
(Reporting by Jeff Franks; Editing by Jane Sutton and Eric Beech)