Tuesday, September 26, 2006

Cuba fires telecoms, computing chiefs in shake-up

Cuba fires telecoms, computing chiefs in shake-up
Mon Sep 25, 2006 2:19 PM ET
By Marc Frank

HAVANA, Sept 25 (Reuters) - Cuba has fired the heads of two of the
country's most influential companies in a bid to bring the computing and
telecommunications enterprises back under firm state control amid a
national anti-corruption drive, industry sources said on Monday.

Information Technology and Communications Minister Ramiro Valdes, 74, a
former revolutionary hero, took over the sensitive sector that controls
communist Cuba's communications, computing, Internet and software
development late last month.

His was acting president Raul Castro's sole ministerial appointment
since he took over temporarily from his brother Fidel Castro on July 31
after the latter underwent intestinal surgery.

The shake-up at the companies did not appear to be aimed at opening up
the sector to foreign capital or to information and entertainment from
outside the country, said the foreign and local sources, all of whom
wished to remain anonymous.

They said Valdes was unhappy with the independence shown by some company
directors and their inability to rein in subordinates despite an ongoing
drive to increase state control over the economy, improve efficiency and
fight corruption.

Cuban President Fidel Castro declared war on corruption a year ago,
warning it could undo his 1959 revolution. Together with his brother
Raul, Castro mobilized youth and Communist Party stalwarts to root out
corrupt practices within the state bureaucracy, leading to widespread
sackings in recent months.

Valdes fired the president of Empresa de Telecomunicaciones de Cuba SA
(Etecsa), Jose Antonio Fernandez, and the vice minister for information,
Nelson Ferrer, for failing to control the fixed-line and mobile services
monopoly, the sources said.

Etecsa, with revenues of more than $400 million in 2005 and in which
Telecom Italia <TLIT.MI> has a 27 percent interest, is one of the most
powerful and visible companies in the country.

Valdez also fired the president of the powerful state-run Copextel
corporation which imports, assembles and distributes advanced
communications, computing and other technology, the sources said.

Copextel, with annual revenues of more than $200 million, has been
caught up in recent corruption scandals involving kickbacks from foreign

Etecsa's new president, Maimir Mesa Ramos, and Copextel's new boss,
Antonio Orta Rodriguez, were both promoted from within the ranks.

International studies have found that Cuba occupies last place in Latin
America for both mobile phone and Internet penetration, and is fifth
from last in terms of its number of fixed telephone lines.

The government blames the four-decade-old U.S. trade embargo for its
poor communications infrastructure.

But Cuba's 11 million people cannot buy a computer or subscribe to the
Internet without a government permit, satellite television is
prohibited, and mobile phones are available only for hard currency.
(Additional reporting by Anthony Boadle)

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