Cuba seeks delay in debt repayment to 2022: diplomats

Havana (AFP) –


Cuba has asked the Paris Club of major creditors for a delay in repaying its debt until 2022, citing the impact of the coronavirus pandemic on its economy, diplomatic sources told AFP on Wednesday.

In a letter sent to 14 Paris Club countries to whom Cuba owes money including Britain, Canada, France and Japan, Deputy Prime Minister Ricardo Cabrisas proposed "a moratorium for 2019, 2020 and 2021 and a return to paying in 2022," a diplomatic source revealed.

Two other diplomats subsequently confirmed the information. All sources spoke to AFP on condition of anonymity due to the sensitive nature of the matter.

Havana missed 32-33 million euros ($35-36 million) in reimbursements in 2019.

In February, it committed to settling that debt by May, but the virus crisis has now put paid to those plans.

According to one source, Cuba will assess its economic situation in 2021 to see if it has recovered enough to resume repayments.

The agreement with the Paris Club is crucial for Cuba, which has been subjected to punishing US sanctions since 1962.

After an easing of tensions under Barack Obama, sanctions have been ramped up under the administration of US President Donald Trump.

In 2015, Havana renegotiated its debt with 14 Paris Club countries, wiping out 8.5 billion euros from an 11-billion-euro debt, with the repayments restructured gradually until 2033.

Cuba, which has suffered from food and fuel shortages, also benefited from several other creditors writing off debt: $6 billion by China in 2011, $500 million by Mexico in 2013 and $35 billion by Russia in 2014.

Havana is increasingly reliant on the European Union, which has become its main investor with almost $3.5 billion in trade in 2018.

However, lockdown measures enforced to combat the pandemic have badly affected Cuba's main sources of income, such as tourism and remittances sent from Cubans abroad.

The UN Economic Commission for Latin America and the Caribbean has said it expects Cuba's GDP to fall by 3.7 percent in 2020, but many experts predict a greater contraction.