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Tuesday, 06 January 2015

Brazil’s Odebrecht eyes growth from Cuban port

Brazilian port operator Odebrecht SA is eyeing further investment and increased volumes in its Mariel Port in Cuba following the relaxation of U.S. sanctions against the island in December.

The $1 billion port development was majority funded Brazil’s development bank BNDES which financed $682 million of the cost while Cuba’s government financed the rest.

In return for Brazilian investment, Cuba signed import agreements for Brazilian goods and services driving a surge in shipping trade between the two states. Brazil had a trade surplus of $431 million with Cuba in 2013 thanks to healthy levels of exports, according to Sao Paulo industry federation Fiesp.

“At least 400 Brazilian companies benefit from this contract, exporting to Cuba,” Cesar Bahia, Odebrecht business director in Cuba said. “It’s great for Brazil.”

While the construction of the port was not predicated on U.S. trade, the loosening of sanctions will doubtlessly provide a welcome boost to operations. As the most modern port on the island the Mariel Port is initially likely to attract significant traffic, before construction of more ports to service U.S. trade are developed further.

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