"No es facil" or "it isn't easy" is a mantra among Cubans about life in their island country. It can also be used to describe investing in Cuba. And for good reason: its government views capitalism with suspicion and controls much of its economy. Even though the Cuban government has welcomed foreign investments from countries such as China and Venezuela, U.S. companies have largely been shut out because of the U.S. embargo, which was instituted in 1960.
But we're at the dawn of a new era: President Barack Obama, John Kerry, Susan Rice, and the entire national security team demonstrated political courage to change the course of history, fomenting a diplomatic rapprochement between the United States and Cuba. As a result, business climate in Cuba has increased for U.S. businesses and investors. Later this month when President Obama visits Cuba, the first president to visit Cuba since Calvin Coolidge in 1928, he will surely highlight the increased business interest and capital flows.
Even though it will take years for many large cap opportunities to materialize, as an investor you can gain exposure to Cuba today. Here's the case for why and how.
Why You Should Invest in Cuba
Cuba checks several boxes for investors: relatively large population, healthy and educated people, a growing economy, and a low public debt level. There's also an investment catalyst: a better relationship with the United States which should unlock more capital flows.
With its over 11 million inhabitants, Cuba has the largest population in the Caribbean. It boasts a literacy rate of 99.8%, which is higher than the United States (99%) and Mexico (93%). The average life expectancy is 79 years old, and it has twice the number of doctors per capita than the United States. It has a low infant mortality rate of 4.63 for every thousand births, lower than the United States (5.87) and Canada (4.65). The director of the World Health Organization observed, "Cuba is the only country that has a health care system closely linked to research and development. This is the way to go, because human health can only improve through innovation."