By Marc Frank Marc Frank – Mon Sep 27, 4:10 pm ET
HAVANA (Reuters) – President Raul Castro has put a military officer in
charge of Cuba's largest commercial corporation as part of a drive to
increase efficiency and reduce corruption in the country's major foreign
Colonel Hector Oroza Busutin arrived at the headquarters of the Cuban
Export-Import Corporation (CIMEX) earlier this month, replacing its
long-time President Eduardo Bencomo, according to various company employees.
"Since then, there have been a lot of military people running around
here," one of them said, asking that her name not be used.
Since taking over the presidency from older brother Fidel Castro in
2008, Raul Castro has taken steps to boost Cuba's troubled state-run
economy and weed out corruption.
He reportedly wants to brings some of the country's independent
companies under government ministries and views consolidation, which has
already begun, as the best path forward.
In many cases, he has entrusted the task to military officers, with whom
he is said to feel more comfortable after almost five decades as Cuba's
At least 10 military men hold positions in his cabinet or as deputy
ministers and heads of key agencies.
Oroza Busutin moved to CIMEX from his position as No. 2 in the
military-run Administrative Group of Businesses (GAE.SA), a holding
company which also operates numerous foreign exchange businesses
including the country's largest tourism corporation and real estate
firm, a chain of warehouses and hundreds of retail outlets selling
everything from groceries to domestic appliances.
Castro's son-in-law, Colonel Luis Alberto Rodriguez, is the chief
executive of GAE.SA.
CIMEX's new deputy director, Ana Maria Oretega, held a similar position
at the military's retail chain, TRD-Caribe, according to the company
"I'm not surprised. It follows the trend under Raul," said a Western
diplomat in Havana.
The appointment has not been announced despite CIMEX's relations with
hundreds of foreign suppliers and significant role in Cuba's everyday life.
CONSOLIDATION UNDER WAY
CIMEX, with annual revenues of more than $1 billion, is an independent
state-run conglomerate that operates exclusively in foreign exchange and
the local equivalent called the convertible peso, valued at $1.08 per unit.
It runs its own shipping line and bank, clears foreign credit card
transactions, controls remittance wire transfers, operates a real estate
business and the country's largest travel agency and owns more than
2,500 commercial outlets including department stores, fast food spots
and gas stations.
The change in command at CIMEX follows the liquidation last year of
CUBALSE, Cuba's second-largest foreign exchange company. Its numerous
businesses were spun off mainly to military-run companies and CIMEX.
The dissolution of CUBALSE, Cuban authorities said at the time, would
"reduce expenses, increase negotiating power, concentrate the
administration of service-providing entities, and carry these out with
In the 1990s, after the fall of the Soviet Union, Cuba's chief
benefactor, the elder Castro opened the door to international tourism
and investment, legalized the dollar and later the convertible peso and
welcomed family remittances.
The military along with CIMEX and CUBALSE were given the task of
absorbing the influx of cash by establishing retail and other businesses
in what the government viewed as an experiment in state-managed competition.
But Raul Castro reportedly has come to view the competitive model in
state-run foreign exchange operations as redundant and rife with corruption.
Theft at their gas stations has been estimated at up to 50 percent by
the official media and much of Cuba's prolific black market is said to
be fed by warehouses under the various companies' control.
It is still not clear what will happen to CIMEX, but many believe some
of its operations will be spun off, with, for example tourism businesses
going to the Tourism Ministry.
There is also talk that a single chain of retail establishments
operating in convertible pesos is planned.
(Editing by Jeff Franks and Cynthia Osterman)