New business models for Cuban tourism outlined

Real estate leases, usufruct agreements, and sales are the new business models recently opened up to the tourism sector in Cuba. With the approval of 176 reforms, the island has created a more open, competitive, and diverse environment for the sector—an opportunity to explore new possibilities for investment, business, and collaboration.

Gran Caribe Hoteles has summarized useful information on its social media for anyone interested in learning about opportunities for foreign investment, participation by Cubans living abroad, and domestic private capital in destinations such as Old Havana, Trinidad, and the keys.

It added that private travel agencies, car rentals, and independent guide services have also been authorized, with tax incentives for ecotourism; meanwhile, Cuban franchises abroad are beginning to become a reality.  

Regarding the reforms, he specified that, with respect to foreign investment, surface rights will be extended to 99 years and usufruct rights to more than 50 years; in foreign trade, private companies and cooperatives will be allowed to engage in foreign trade activities directly; and in banking and finance, an online corporate bank will be created for the sector with international ties.

OPEN DOOR FOR NEW STAKEHOLDERS

In addition, the range of entities eligible to provide direct tourism services has been expanded to include car rentals (authorized for state-owned enterprises, foreign investment, and non-state management entities), travel agencies (which may be established by joint ventures, 100% foreign-owned companies, or the non-state sector), and private tour guides and sales agents (subject to certification and authorization).

Overall, the strategy aims to position the “Cuba” brand globally, with its greatest strength being the promotion of Cuban franchises abroad as a means of generating revenue and establishing a global presence. Examples include Casas Cuba, Casas de Habanos, La Bodeguita del Medio, El Floridita, and Tropicana, among others.

The approved tax benefits create incentives and improve coordination within the sector, particularly in promoting ecotourism and specialized tourism projects. Additionally, the role of a local destination manager has been approved to bring together all stakeholders and ensure efficient mixed governance; and a special tax or contribution for the sustainability and promotion of destinations will be evaluated.

TOURISM EXPANSION

Among the measures related to tourism expansion is the decentralization of tourism development to boost the entire country, and Economic Development Zones with special regimes will be designated within the portfolio of opportunities.

Likewise, tourism real estate development is authorized in Havana and other urban areas of the country.

The avenues for doing business in the sector are also being expanded; in addition to joint ventures and management contracts, operations will be permitted through the leasing of tourism facilities, paid usufruct rights over areas or assets, the purchase and sale of real estate (approved on a case-by-case basis), and foreign investment, including investment by Cubans living abroad and domestic investors.