New Caterpillar Distribution Center in Cuba

Even with US-Cuba relations up in the air, business continues as usual. Despite the negative writing on the wall from a foreign policy standpoint, companies are continuing with their plans to do business with Cuba.

Cuba gave RIMCO, Caterpillar’s Puerto Rico-based dealer, permission to set up a Caterpillar warehouse and distribution center in Cuba’s Mariel Special Economic Development Zone, envisioned by the Cuban government as the island’s economic future. After a long process of campaigning and negotiations, Caterpillar Inc. is the first US company to locate in the Cuban economic zone.

Caterpillar Inc., has been building relations with Cuba and lobbying to lift the US embargo on the country for years now. Former Chief Executive Doug Oberhelman visited the island in May of last year to meet with the government and make a donation to the Finca Vigía Foundation, which preserves the heritage of Ernest Hemingway in Cuba.

Caterpillar Inc. traces its origins back to the 1925 merger of Holt Manufacturing Company and the C. L. Best Tractor Company, which was originally located in California. The corporation has since moved its headquarters to Deerfield, Illinois, where it has become a worldwide industry giant, ranking at #194 on the Global Fortune 500 list in 2016. The company designs, develops, engineers, manufactures, markets, and sells everything from machinery and engines to clothing and workwear, and is known worldwide for its all-caps “CAT” logo.

The Mariel Special Economic Development Zone–or the Mariel port, rather–is probably best known in the United States as the departure point of the Mariel boatlift, where as many as 12,500 Cubans emigrated from Cuba to Florida in 1980. Now, the Mariel zone is viewed as Cuba’s economic future–the beginning of a giant commercial city built on high-tech, advanced manufacturing and sustainable development. Raul Castro himself has called the Mariel project the most important project carried out by the Cuban Revolution in the past 50 years. Former Brazilian president Luiz Inacio Lula da Silva, whose administration loaned Cuba enough money to pay for most of the cost of the Mariel development, said that “Mariel represents the possibility of an industrial revolution for Cuba.”

RIMCO is taking the first step towards making this potential industrial revolution a reality in the Mariel zone. Having obtained permission to operate from US authorities, the Cubans also signed off on the deal at last week’s International Trade Fair held in Havana. Despite the continuing US trade embargo with Cuba, most foreign banks remain unwilling to do business with Cuba. However, Dutch equipment rental company Womy has moved into Mariel as well, already giving Caterpillar a competitor in the area.

Director of the Mariel Special Economic Develop Zone Ana Teresa Igarza remains confident in the possibilities for investment. “We believe that there will always be businesses who have faith in this country – as Womy has – and that there will always be possibilities for foreign companies to establish themselves here, including the Americans,” Igarza said. Igarza went on to say that at least 21 more new projects have been approved for the flagship development zone.


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