New hotels going up in Cuba despite economic crisis

By Juan Carlos Espinosa

Havana, Aug 18 (EFE).- In the dining room of the Havana’s luxurious Grand Aston Hotel, which opened in March, there are more servers than diners, to the point where the employees joke “It gives you time to think.”

The restaurant of the huge building, with 600 rooms that can cost some $200 per night each, overlooks the Cuban capital’s iconic Malecon – or seaside boulevard – but there are scores of vacant tables.

There are almost no guests to be seen. And that’s the case in many hotels all over the communist island, some of them built and opened in just the past few years even though Cuba has been mired in a serious economic crisis since 2020.

“I noticed (the lack of tourists) when I looked from my room out into the street the next morning and nobody was there. It’s true that it seems strange to us,” said a 20-year-old Valerie, a French tourist, in the lobby of the Havana Libre Hotel.

Although hotel occupancy in Varadero, Cuba’s main sun and beach destination, is greater than in Havana and it’s not the high season – which occurs in winter – the figures experts are using confirm Valerie’s remarks.

Occupancy rates were about 50 percent between 2016 and 2020, according to official figures provided by economist Pedro Monreal.

The number of available rooms, meanwhile, has jumped by more than 25 percent since 2016, with 62,000 being available in that year and 78,862 – 74 percent of them in four- and five-star hotels – available now, according to Tourism Ministry (Mintur) figures.

Monreal also said that over the past two years, while Cuba’s GDP tumbled by more than 7 percent, the state spent about $1.5 billion on building new hotels, some 50 percent of overall investment in 2020 and 2021.

In the first three months of this year, hotel construction – along with other things related to tourism – took 35 percent of all investment, according to the National Statistics and Information Office (ONEI), with that being more than 20 times more than Cuba spent on public health and almost 30 times what it spent on education.

Tourist flows have gone up and down depending mainly on various political factors and due to the coronavirus pandemic.

In the first six months of 2022, Cuba welcomed 682,297 foreign visitors, five times more than during the same period last year, but far from the more than 2 million who arrived during the first six months of 2019 before the coronavirus.

Cuban authorities hope that some 2.5 million tourists will arrive this year, a figure that experts have now cast doubt upon, given current trends.

Before the pandemic, in 2018 and 2019, Cuba managed to attract between 4 nd 5 million international travelers each year.

Cuban President Miguel Diaz-Canel admitted at a tourism fair earlier this year that the country’s investments in the tourist sector “are not always understood by a part of the public” and emphasized the need to work to increase “efficiency” in the sector.

Meanwhile, experts do not seem to share the government’s analysis of the situation, with economist Mauricio de Miranda saying that building new hotels “isn’t justified,” and adding that “At no recent time has occupancy gotten to the point where it really shows that we need to increase the number of rooms.”

And Pavel Alejandro Vidal, an associate professor with Colombia’s Universidad Javeriana in Cali, agrees with that assessment, although he added that tourism “has remained at acceptable levels of efficiency” and emphasized that “it’s the only sector where one can point to a (national) recovery.”

Meanwhile, Mintur’s plan from 2016 calls for building more than 100,000 hotel rooms by 2030, although that plan was developed at a time when Havana was gleefully eyeing the wealthy US market amid the “thawing” of US-Cuban relations under former US President Barack Obama.

Two years later, after Donald Trump had reversed Obama’s opening to Cuba, that plan looked to have imploded.

Experts say that the Cuban government’s tourism model is all wrong. “They’re losing the opportunity to create their own tourism product. They’ve put their bets on the massive sun and beach model, which is already in ruins in many countries,” said economist Elias Amor.