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Tuesday, February 09, 2010  / 4:29:21 PM

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Published: Tuesday, October 06, 2009
Bylined to: Laht.com

Venezuela's Chavez fills $9.4 billion yearly post-Soviet gap in Cuba's accounts

Laht.com: Time was when the Castro regime in Cuba looked to the Soviet Union to keep its economic head above water. That was until the USSR fell apart two decades ago and the well of subsidies dried up.

Hard times were had by most people in Havana and elsewhere on the sugar cane island. A new rich friend was needed, and around a decade ago, duly appeared. Venezuela's President Hugo Chavez came to the much-needed rescue, and continues to do so to this day, even if Chavez' favored mentor, the ailing Fidel, has made way for his brother, Raúl.

In nominal terms, at least, Caracas looks to be as open-handed towards Havana as Moscow ever was. According to Carmelo Mesa, a Cuban economist who's a visiting professor at Tulane University in the United States, Venezuela bankrolled Cuba to the tune of $9.4 billion last year.

This includes $2 billion to take account of the cost of subsidizing Venezuelan oil exports to Cuba. Venezuela sends oil to Cuba at a "preferential" price of just $27 a barrel.

That price is below even the low point of a little over $34 a barrel that the price of Venezuela's mix of medium-grade and heavy crude oil hit at the end of last year. At present, Venezuela's oil basket is wobbling up and down at around $60 a barrel.

Venezuela is also calculated to have footed the bill for $1.37 billion for 76 bilateral projects last year. More of these are said to be waiting in the wings, and in addition, there's the (perhaps theoretical) cost of servicing Cuba's burgeoning debts to Venezuela.

However, the biggest ticket item on last year's account is said to have been Barrio Adentro, the flagship project launched by Chavez in 2003 to bring basic medical services to poor barrios across Venezuela.

Chavez adjudged the existing state health service to have fallen down on the job; he lambasted the medical profession for turning their backs on the poor; he set up Barrio Adentro; and he staffed it largely with doctors, nurses and other medical staff brought in from Cuba.

To some extent, this made sense. For all the shortcomings of the Castro regime, presumed or actual, Cuba trains many medical professionals, even if the courses are much shorter in years. experience and technology than Western countries would expect from their doctors.

This, it would seem, has not come cheaply. According to Mesa's breakdown, which was published Monday by the conservative (and quite openly anti-Chavez) newspaper, El Universal, the payroll for Cuban medical and ancillary staff at Barrio Adentro reached $5.6 billion in 2008.

News of this came after a string of reports to the effect that Barrio Adentro began to come apart at the seams quite some time ago. One reason for this, it was said, that Cubans had used Barrio Adentro to leave Cuba, and then piggie-backed on Chavez' parallel public health program to make their way into private practice, not least of all in the highly lucrative health market in the United States.

There are some problems with this. If so many Cubans had used Barrio Adentro for their own purposes, how come the payroll costs remained so high?

Mesa puzzled about this, evidently convinced that a lot of Cubans had flown the coop. "What happened w

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Editor
Roy S. Carson
News Editor
Patrick J. O'Donoghue
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