New law to create investment-friendly Cuba

Foreign investors will be able to do business in communist Cuba without fear of government interference once a new law is approved later this month, a top lawmaker told state media on Monday. The lawmaker tasked with overseeing the drafting of the new investment law said in the official Granma newspaper that the new legislation would usher in a business-friendly climate in this bastion of communism. The law will "work to strengthen guarantees to investors," said Jose Luis Toledo, head of the legal affairs committee in Cuba's National Assembly. Cuba's National Assembly has been holding meetings to draft the measure, which aims to attract much-needed capital into the nation's faltering economy. A more investment-friendly climate will include more favorable tax rates for foreign enterprises, said Toledo, who said that the changes could mean investors in some circumstances pay no tax at all. Havana first announced in January that it planned to open its economy to outside investment, saying overseas investment in the future will occupy a major role in Cuba's once tightly shut, state-run economy going forward. The changes are part of a gradual but far-reaching overhaul of Cuba's Soviet-style economy under President Raul Castro. Cuban authorities have said that they want to target high-tech businesses, particularly in agro-business, biotechnology and information technology in their quest for outside investment to help propel the island's antiquated economy into the 21st century. The bill under discussion would replace current law on foreign investment which has been in force since September 1995. That law mandated that foreign capital should play only a complementary role in Cuba's economy, including providing funds and technological know-how to enterprises run by the Cuban state.