The agreement between Cuba and 14 sovereign creditors at the end of 2015 marked an important step for the country. After three decades in default, and thanks to unprecedented steps to update its state-run economy, Cuba has had $8.5bn out of $11.1bn-worth total claims forgiven by official creditors, provided that it meets new repayment obligations on time.
Many have described this as a generous deal. Should Cuba soon settle with its commercial creditors, further ‘generosity’ may come its way. A favourable deal with investors grouped under the umbrella of the London Club could have huge upside: private sector investors would cash in on their bets and extend their exposure to an economy that is likely approaching a historical moment – in the shape of the removal of wide-reaching US sanctions – and is serious about attracting foreign investment. By settling commercial claims promptly, on the heels of the official creditors deal, the country would give the definitive message other investors are waiting for: Cuba means business.
