Carnival charts a course to Cuba after US approval

Carnival Corp. is joining a myriad of travel companies racing to make their mark on US-Cuba routes. While corporations have their own interests in profiting from an untapped market, the economic interest in Cuba could lead the way toward a revitalized economy and improved infrastructure.

The parent company of cruise lines Carnival and Princess Cruises announced Tuesday that both the US Department of the Treasury and the US.Department of Commerce approved the company to begin travel to Cuba. If the Cuban government gives its approval, the routes will begin in 2016 . Prices for the weeklong trips start at $2,990 per person, which includes all meals aboard the ship and specific cultural immersion activities and excludes taxes, port and other government and related fees. 

The US still bans leisure travel to Cuba, but Carnival Corp. can legally bring Americans to Cuba through its recently-launched fathom brand. The cruise company describes it as “a new social impact travel brand providing purpose-oriented, social impact experiences." Under the recent amendments to the country’s embargo on Cuba, the US government can authorize US-Cuba travel if it meets the qualifications for at least one of 12 categories, including humanitarian projects.

Arnold Donald, president and CEO of Carnival Corp., said in a press release that he and his team are excited to be approved by the US government and are looking forward to working with Cuba to make travel between the two countries work. "We know there is strong demand from travelers who want to immerse themselves in Cuban culture, so this is a historic opportunity for us to enable more people to experience Cuban society,” he said.

Since the US announced the start of normalizing diplomatic relations with Cuba – including plans for both countries to open up their embassies for the first time in half a century – US companies have been coveting their corners of this new travel market. Last week, US carrier JetBlue Airways Corp. began direct charter flights between New York City and Havana, as previously reported by The Christian Science Monitor. Netflix also launched streaming service to Cuba earlier this year, and investment funds to raise capital for the country have been popping up.

When JetBlue announced its plan to fly to Cuba in May, Gary Leff – author of ViewFromTheWing, a blog for the frequent flyer community – told The Monitor in May that in the long run, “there’s a lot to be done, precisely because they’re so backward.”

What makes Cuba both appealing and daunting is that companies have to start from the ground up. On one hand, Cuba is a blank canvas for corporations to leave their mark on the island nation. On the other hand, the US’s  65-year-old embargo has left the country with deteriorating and unreliable infrastructure. In 2013, the National Hydraulic Resources Institute (INRH) reported that Cuba loses 22 percent of potable water distributed to homes from leaks in pipes and tanks, Agencia EFE reported. There is only one facility that makes water tanks and cisterns in Cuba, INRH said, which was built about 30 years ago and now only produces enough to satisfy 40 percent of domestic demand.

But the growing interest in the country from companies and tourists alike, and the more relaxed travel restrictions could open the door for Cuba to have its infrastructure and economy strengthened by both private entities and the Cuban government. In June, Cuba opened 35 state-owned Wi-Fi access points across the country, opening up more Internet access in a country where it was previously limited to at state internet cafes and expensive hotels, the International Business Times reported. The price of Internet usage was also lowered from $4.50 to $2 an hour. While is the cheapest option for Cubans, it is expensive considering the average salary in the country is $20 a month.

Tourism from other countries has allowed entrepreneurs to be creative and make most of their limited resources. For example, a Cuban entrepreneur named Julio Alvarez Torres has built a business on using old US cars from the 1950s to drive tourists around Havana. He and his wife oversee a fleet of 22 classic private cars and drivers live better than any state worker” with the money they earn, Alvarez told The Miami Herald.