At Atelier, foreigners and Cubans find food and service that had disappeared from Havana for decades. Credit Todd Heisler/The New York Times
HAVANA — The business ideas have ranged from a bikini franchise to a peanut farm, restaurants, and design firms for software and home interiors. But even more novel than the pitches — in a country where entrepreneurship used to be illegal — is the financial muscle behind them: Cuban-Americans whose families lost their previous ventures to Cuba’s Communist government.
“It’s all about people not losing hope and seeing that starting a business is a way to improve their lives,” said Eduardo Mestre, 65, a Wall Street banker who returned to Cuba last year for the first time since 1960 to see the start-up training he helps finance. “Emotionally, it’s very hard not to connect with people who have all this ambition in a place where maintaining hope is very hard to do.”
Many of the first Cubans to leave after Fidel Castro took over are beginning to come back, reuniting with the island they left in bitterness and anger, overcoming decades of heated opposition to its leaders, and partnering with Cubans in direct, new ways.
Some are educating a new crop of Cuban entrepreneurs to take advantage of the recent limited openings for private enterprise in Cuba. Conservative Republican exiles in Miami have also helped finance the renovation of Cuba’s most revered Roman Catholic shrine. Young heirs to the Bacardi family, which fled Cuba after the revolution, leaving behind luxurious homes and a rum business that employed 6,000 people, are sending disaster relief and supporting artists. And Alfonso Fanjul, the Florida sugar baron, recently acknowledged that he had gone back to Cuba twice, meeting with Cuban officials and later declaring that he would consider investing under the “right circumstances.”
It has been a shocking reversal for a community of exiles that has long represented a pillar of support for the American embargo against Cuba. And though the activity is legal through humanitarian or other licensed exceptions to the sanctions, some Cuban-American lawmakers have responded with outrage. Representative Mario Diaz-Balart, a Republican from Miami, called Mr. Fanjul’s trips a betrayal.
“The question is how can we better help the Cuban people free themselves from this regime that has been there for over half a century,” he said. “And the best way to do that is to deny funds to the regime in any way we can.”
But what has emerged in Miami, New York and elsewhere over the past two years, as President Raúl Castro has opened the economy, just a crack, is an alternative approach that emphasizes grass-roots engagement, often through churches, as a tool for giving Cubans skills and independence from the state. Among many Cuban-Americans who now describe themselves as a part of a diaspora, rather than exiles, a new sense of responsibility — to Cubans on the island, not to the property they lost or to fighting the Castros — has gathered strength.
“We think engagement, dialogue and interaction — lowering the barriers — is the best way to develop civil society,” Mr. Mestre said, “but also some of us who feel some respect for the 11 million people stuck there, we just really feel that’s the right thing to do.” He added that he sought a relationship with Cuba, despite the loss of his family’s homes and businesses, including what was once Cuba’s largest television and radio network, because “the loss of our property and wealth is kind of secondary to the feeling about what happened to the country and its people.”
The expanding exchange of people, ideas and money is a result of policy changes over the past few years in Washington and Havana that have opened up travel and giving for Cubans and Cuban-Americans. After decades of being cut off by politics, the airport here is always crammed with Cuban-Americans coming to see family and lugging in gifts, just as it is now more common to see Cuban artists, academics and dissidents in Florida or New York, often mingling with the established Cuban-American elite.
“The broad trend is Cubans’, regardless of their politics or ideology, coming here to visit, live and work, and go back and forth,” said Julia E. Sweig, the director for Latin American studies at the Council on Foreign Relations. “It’s an organic dynamic in which the elite are participating.”
For many families, the transition from keeping Cuba at a distance to pulling it close has taken time and multigenerational discussion. When Kevin O’Brien and some of his cousins decided a few years ago to take charge of the long-dormant Bacardi Family Foundation, they agreed to focus much of their support on Cuba, returning to a version of an old family custom: Relatives pool money together and distribute it to a chosen cause or person.
Not everyone gives; there are about 500 Bacardis now, and disagreements over the homeland are common, said Mr. O’Brien, the foundation’s president. But since reactivating the foundation in 2012, the Bacardis have raised $28,000 for water filters after Hurricane Sandy and financed efforts to encourage creative expression, with art, photography and music.
Cuban officials seem tolerant, to a point. Eager to improve their weak economy, they welcome the money but fear its power, said one artist supported by the foundation who spoke on the condition of anonymity to avoid reprisals. He added that while Cuba’s leaders had become more welcoming — no longer calling exiles gusanos, or worms — they were still distrustful, determined to keep Cuban-American influence from becoming an immediate challenge to the state.
Higueras Martinez, 39, in the kitchen of Atelier. Credit Todd Heisler/The New York Times
For now, experts say that seems unlikely. The organized money going to Cuba, beyond an estimated $2.6 billion in family remittances, mostly from the United States, remains relatively small. A lot of it is still funneled into the Catholic Church, one of the few institutions allowed to play a role in civil society. The Order of Malta provided 800,000 meals for the elderly in Cuba last year with around $250,000 in donations, mostly from Cuban-Americans in Miami. The Cuban police nonetheless interrogated some of the old women being fed.
The Cuba Emprende Foundation, a nonprofit on which Mr. Mestre is a board member, has also struggled to reassure Cuban officials that its founders — a bipartisan mix of exiles long dedicated to engagement and others who only recently embraced the idea — are interested only in incubating small businesses, in line with the government’s stated economic policy. The organization’s official tax forms filed recently with the I.R.S. state that it has disbursed about $225,000 so far, none of it from the United States government.
Board members say that Cuban officials suggest that Cuba Emprende must be part of a covert Washington plot. A Cuban instructor in Havana, who spoke anonymously to protect the program, said the pressure had increased as Cuba Emprende grew; by mid-March, 731 graduates will have completed the 80-hour course, run through the church in an old seminary here and at a rectory in Camaguey.
Cuban-American lawmakers who back the embargo also seem displeased with the increased engagement, even though Cuba Emprende and other groups in Cuba emphasize that their work does not violate the embargo.
Senator Robert Menendez of New Jersey, the Cuban-American Democrat often described by administration officials as Washington’s main impediment to broader changes in Cuba policy, said it was simply ineffective. “I’m not seeing this engagement produce the results they say it would,” he said, adding that “the regime hasn’t become more open,” even as Europeans travel and invest in Cuba, unfettered.
Mr. Mestre contends Mr. Menendez and other embargo supporters in Congress are counterproductive. “With that attitude,” he said, “you’re just hurting the people you’re trying to help.”
Increasingly, many Cubans and Cuban-Americans are building their own ties, reveling in the surprise of a rediscovered connection. “Cubans are Cubans,” said Niuris Higueras Martínez, 39, one of Cuban Emprende’s first graduates, in 2012. “We find ways to work together.”
That bond is now evolving alongside, or within, Mr. Castro’s limited opening to market ideas. Ms. Higueras, a whirlwind who had always dreamed of opening a restaurant, now owns Atelier, one of Havana’s most popular eateries. Cuba Emprende played a major role in making it happen.
“Everything in that course was important,” she said, including how to calculate her books or change her menu for the slow season. She said she also benefited from the sense of a shared mission with her classmates and the accountants and other professionals Cuba Emprende relies on for help in Cuba. “There was just such chemistry,” she said.
Now, in her business and others, there is a demand for more opportunity, more possibility — but also the usual barriers. Cuban law and the American embargo prohibit Cuba Emprende from bankrolling its students’ ideas as it would like to. Without enough capital for bigger ventures, including Ms. Higuera’s dream of a cooking school, some ambitions are just visions.
During the dinner rush at Atelier, however, with foreigners and Cubans enjoying food and service that had disappeared from Havana for decades, Ms. Higueras was more interested in focusing on how far she had come. “If you have 15 employees, you have at least 10 families whose troubles are suddenly resolved,” she said, wiping a few drops of chocolate from the corner of a plate on its way out of the kitchen. “If you open a little, you get a lot.”
‘Agriculture dependent population in India grew by 50% during 1980-2011’’
The agricultural population of India grew by a whopping 50 per cent between 1980 and 2011, the highest for any country during this period, followed by China with 33 per cent, while that of the US dropped by 37 per cent as a result of large-scale mechanisation, a latest report has said.
“Between 1980 and 2011, the economically active agricultural populations of China and India grew by 33 and 50 per cent respectively due to overall population growth,” the Worldwatch Institute said in a report.
“The economically active agricultural population of the US, on the other hand, declined by 37 per cent as a result of large-scale mechanisation, improved crop varieties, fertilisers, pesticides, and federal subsidies —all of which contributed to economies of scale and consolidation in US agriculture,” it said.
The global agricultural population — defined as individuals dependent on agriculture, hunting, fishing, and forestry for their livelihood — accounted for over 37 per cent of the world’s population in 2011, the most recent year for which data is available.
This is a decrease of 12 per cent from 1980, when the world’s agricultural and non-agricultural populations were roughly the same size.
Although the agricultural population shrank as a share of the total population between 1980 and 2011, it grew numerically from 2.2 billion to 2.6 billion people during this period, writes Worldwatch Senior Fellow Sophie Wenzlau in the Institute’s latest Vital Signs Online trend.
According to the report, between 1980 and 2011, Africa’s agricultural population grew by 63 per cent, and its non-agricultural population grew by 221 per cent.
Oceania’s agricultural population grew by 49 per cent, and its non-agricultural population grew by 65 per cent.
Asia’s agricultural population grew by 20 per cent, and its non-agricultural population grew by 134 per cent, it said.
The combination of movement to cities and agricultural consolidation caused agricultural populations to decline in Europe and the Americas between 1980 and 2011: by 66 per cent in Europe, 45 per cent in North America, 35 per cent in South America, 13 per cent in Central America, and 7 per cent in the Caribbean, the report added.
Mapping the geographical digital divide
This Gizmodo map of average Internet speeds by congressional district shows how disparate access to the web is.
Where long-term unemployment is at historic highs
Before the recession smashed the record, long-term unemployment peaked at 26 percent thirty years ago. But in 2013 it was higher than that in 41 states and D.C. It’s highest in D.C., New Jersey and Florida, where more than 45 percent of the jobless are long-term unemployed (i.e. unable to find work after about six months of looking).
Recently, Canada announced that it would end its investor program, closing off another path for Chinese immigrants.
However, as Canada closes the door, island countries such as St Kitts and Nevis have opened another window for Chinese entrepreneurs who are seeking immigration for various reasons.
Island nations have become the popular alternative immigration choice for rich entrepreneurs in China, because of benefits such as relaxed conditions and low investment requirements. Entrepreneurs such as Zhang Lan, the chairwoman of high-end restaurant chain South Beauty, and Feng Changge, the founder of Harmony Auto, are reported to have migrated there.
A booth for overseas investment at the Shanghai Real estate fair, on October 3, 2013. Photo: I
A newly released report conducted by the Hurun Research Institute said that 64 percent of Chinese millionaires have already migrated with their wealth or are preparing to do so.
On January 22, 2014, the Center for China and Globalization and the Chinese Academy of Social Sciences jointly released a bluebook on the status of Chinese people migrating overseas. The bluebook showed Canada as the top destination for Chinese migrant investors.
An agent surnamed Zhou from St Kitts and Nevis Investment Services said that since the investment immigration service closed in Canada, many clients have set their sights on moving to smaller islands.
The service was created by the Greenfield Group Asia Inc., according to its official website, one of the many services in China that offer investment and immigration consultation to the federal two-island country in the West Indies.
There are two ways of obtaining nationality there: donating $250,000 per person to local foundations, or by investing at least $400,000 in real estate per family, Zhou said, a relatively low threshold compared to other countries.
“This country has no demands on applicants, including the source of investment. Besides, it only takes a short time before you can become a citizen and get a passport,” she said.
“In the middle of 2012, St Kitts received fewer than 20 Chinese immigrants. That number has now more than doubled, and many clients of listed companies say they were forced to migrate to the island,” a Hong-Kong-based agent surnamed Feng told the Legal Weekly.
There are many such clients, Feng said. Those people never live for a long period on the island, and they don’t care about seeing the place. They just need an immigrant’s status.
Even though the Chinese clients have acquired the nationality, it doesn’t mean they are true immigrants, and they don’t have election rights, Legal Weekly reports.
Zhou said if the clients don’t live on the island, they won’t enjoy the benefits. However, the local benefits aren’t as attractive as the ones offered by Canada or the US, so the people who choose to migrate there usually don’t care for such benefits.
She confirmed that Zhang Lan has indeed migrated to St Kitts, but through an agency service based in Taiwan.
Satellite image of Saint Kitts (upper left) and Nevis (bottom right) in the Caribbean Sea. Photo: IC
Canada was formerly a favorite immigration destination.
The country’s Immigrant Investor Program (IIP) had been popular in China due to its low risk and high security. The program started in 1986, an immigration policy the Canadian government used to attract investment from abroad. It requires investment of CAD$800,000 ($730,727), which is loaned to the government for five years with no interest, and a personal net worth of CAD$1.6 million.
Time Weekly reported that many families’ plans had been disrupted by the change of policy.
If it weren’t for the closing of the program, Li Rong might be preparing her winter clothes for her trip to Toronto. A few members of her extended family had already moved to Canada, living in Vancouver and Toronto.
The suggestion to migrate to Canada came from her father, a merchant in the raw steel industry who speaks hardly any English. His relatives and friends kept telling him about the benefits of living in Canada. Finally, he decided to invest and give his family a new life.
According to Li’s investment plan, Li Rong will be the only person living in Canada, while her parents and brother will only visit Canada occasionally.
“The reason they wanted to migrate by investing is so that they can enjoy the benefits Canada offers after retirement, and secondly to transfer their property abroad because in the future China might establish housing or death taxes,” Li told the Time Weekly.
Time Weekly reports that in the past 28 years, the IIP has drawn more than 130,000 immigrants into Canada, most of whom are from China.
On February 11, the Canadian Finance Minister Jim Flaherty unveiled the 2014 budget, proposing to scrap the program in 2014, a policy that directly affects 65,000 applicants who are waiting for their results, as well as many potential applicants.
However, even as Canada closes its door on immigrants, many other countries are trying to win them over.
“If the clients who are going with the IIP want to change their channel, we suggest Europe,” Liu Jianyu, a Shanghai-based immigration expert, told Time Weekly.
European countries such as the United Kingdom are opening up their immigration policies in order to win over rich Chinese immigrants. In 2013, England gave 30 percent of its million pound investment immigration visas to Chinese.
From the end of 2012 to October 2013, the Portuguese government gave out 560 “golden visas” to families who invest over one million euros in Portugal, and 90 percent went to Chinese people, according to Time Weekly.
Frigate Bay Beach, St Kitts, in Central America. Photo: IC
According to data from the CCG’s bluebook, a growing number of rich people in China are migrating overseas mainly due to concerns over the environment, children’s education or to send their private property abroad.
Since the Canadian program was closed, the consultancies contacted by the Global Times said the clients have decided to move to other countries. Liu Guofu, an expert on immigration law from the Beijing Institute of Technology, said that as Canada has closed down its investor program, it’s only natural that the entrepreneurs will choose other countries.
“There aren’t many choices for Chinese people to immigrate to, usually the US, Canada, Europe, or Mediterranean countries,” he said. “Besides these countries, the only other options left are island countries.”
There are few choices for entrepreneurs, because only a few have relaxed immigration requirements, Liu said. For example, the US requires at least $500,000 in investment. Some countries require that the applicants speak the local language, while others require that applicants show the source of their investment funds. Island countries usually have lower conditions than countries such as the US or Australia, he said.
Furthermore, if entrepreneurs register their companies overseas, they are subject to a lower tax rate, Liu said.
“For those island countries, they don’t have many resources or markets, so they need the investors to develop their economy. Therefore, they give a low tax rate. That always existed,” he said.
Another reason for entrepreneurs to choose these countries is so that their companies can become listed, media reported.
Many Chinese companies push to get listed as red chips in Hong Kong, but since a regulation came out in 2006 saying all red-chip companies and investors must report to the Ministry of Commerce for approval before setting up companies overseas, no company in the Chinese mainland has received approval, therefore blocking their chance to enter the Hong Kong stock market, the Legal Weekly reported.
As a result, island countries have become a popular choice for entrepreneurs: becoming a foreigner means they can get around this regulation.
Guo Xinfei, an Internet company director who is in the process of migrating to an island country, told the Legal Weekly that for most countries, migrating means living there for four to 10 years, which is an unfeasible condition for businessmen who are eager to get their companies listed.
There are only three countries that don’t have this requirement, and St Kitts is one of them, Guo said. Besides, most countries waive visas for their citizens, which makes it a more convenient location.
But there are downsides to this move, Legal Weekly reported. Since China doesn’t accept dual nationality, acquiring a foreign passport means giving up Chinese citizenship as well as opportunities for political titles, such as being a member of the CCPCC or the NPC.
Besides, if there are investments within the mineral or energy sector, entrepreneurs will lose their opportunity because they don’t have Chinese citizenship, Guo said.
Where the Millionaires Are
More than six million households in the United States have liquid assets worth more than $1 million, according to new estimates that show the greatest concentrations of wealth in the United States are along the Interstate 95 corridor. (Click through for an interactive map.)
Who’s most well off
Gallup’s well-being index.
Gallup’s well-being index relies on 55 metrics, including rates of obesity, produce consumption, smoking, depression and psychological fulfillment. Generally, the best-off states are in the Midwest and West while the worst are in the south. And there was quite a bit of a shakeup last year. Nineteenth-ranked North Dakota rose to the top spot, while 12th-ranked South Dakota took the second spot. After four years on top, Hawaii fell to the eighth spot. Read more at Gallup.
Mainland Chinese line up for Australia’s ‘Millionaire Visa’
- Chinese are the biggest group to apply for Australia’s ‘millionaire visa’
- High wealth individuals must invest $A5 million in Australia to get a visa
- Those investing for more than four years are eligible for permanent residency
- Chinese are the third largest immigrant group in Australia after the UK and NZ
Hong Kong (CNN) — There’s little doubt which country Australia is targeting under its immigration scheme for the super-wealthy; the investment visa is called sub-class 188 and its permanent visa is called sub-class 888.
In China, the number eight is culturally associated with wealth, prosperity and good fortune and rich Chinese nationals have been queuing up for the opportunity to live in Australia under the millionaire visa program.
Since the scheme was launched in November 2012, 91% of the 545 applicants for the visas have been Chinese nationals, according to figures from the Australian Department of Immigration and Border Protection.
So far, Australia has granted 65 ‘significant investor’ visas to mainland Chinese.
The requirements for getting one of the highly prized visas are simple: all you need is a clean criminal record and $A5 million ($US4.37 million) to invest. There is no language requirement, upper age limit and applicants do not even have to set up a business in Australia.
Report: Wealthy Chinese using tax havens
Joining China’s journey home
The world’s largest mass migration
Those able to park their A$5 million investment in Australia — complying investments include government bonds, managed funds and Australian proprietary companies – for more than four years can apply for a permanent visa.
Under the scheme, visa holders can keep their operations running in China if they wish. It’s hoped that the move will attract a greater range of immigrants to Australia.
MORE: Europe’s golden visas lure China’s rich
Deloitte partner and global immigration leader Mark Wright told the Australian Broadcasting Corporation the days of Chinese investors coming to Australia simply to start a corner store or a small business were over.
“Australia is now looking to attract a larger scale of investment to feed a greater level of infrastructure development,” Wright said.
According to a report by professional services company KPMG, the patterns of Chinese investment are beginning to change, with more private Chinese investors expanding their interests in the country.
The report said that while Chinese state-owned enterprises (SOEs) accounted for 64% by value of the amount invested in Australian agriculture between 2006-2012, Chinese private investment accounted for 70% of the deal volume.
“Chinese companies are playing a more active role compared to other sectors such as mining and gas, where SOEs have dominated,” the report said.
According to immigration specialists in Hong Kong, Sydney and Melbourne — where property prices have risen 10% and 6% respectively over the past 12 months — are the preferred destinations for mainland Chinese immigrants.
The chief executive officer of McGrath Estate Agents, John McGrath, said that Chinese buyers had boosted prices in certain sectors of the Australian property market.
“In some suburbs 90 per cent of new product will sell to Chinese buyers,” he told the ABC. “I think it is quite centralised in certain pockets, so I don’t think it is doing great damage or harming local buyers’ opportunities to buy here still.”
According to the Australian Bureau of Statistics, the proportion of Australian immigrants born in Asia increased from 24% in 2001 to 33% in 2011.
Around 6% of immigrants born overseas came from China — the third largest group in Australia. While this group, along with Indians, represented one of the fastest growing groups, it was still a long way behind immigration from the United Kingdom, at 20%, and New Zealand at 9.1%.
Immigration has been a politically charged and emotive subject in Australia, where the conservative Liberal Party won election last year partly on a platform of promising tougher policing of the country’s immigration laws. Australia turns away thousands of refugees and asylum seekers but at the same time is suffering a skills and manpower shortage for manual jobs.