The Future Is Built With Cement … But There Isn’t Any

A house under construction in Cuba

14ymedio bigger14ymedio, Reinaldo Escobar, Havana, 26 May 2017 — The cranes show off their slender anatomy in some areas of Havana where several luxury hotels are being built. Apart from this landscape of progress, private construction and repairs face technological problems and shortages. This week it has been cement’s turn.

“This is the third time I have come and I am leaving with an empty wheelbarrow,” a customer on the hunt for construction materials complained Thursday in the Havana’s La Timba neighborhood. The employee standing behind the counter confirmed that “they are sending less than before and every day more people come to try to buy it.”

To send, to arrive and to supply are the verbs used to refer to the state distribution of any product, be it eggs, milk powder, or tiles to cover a roof. There is an enormous supply chain responsible for distributing construction materials, in a country where 39% of the housing stock is in “regular or poor” condition.

Since the beginning of the year, gray cement has become the biggest headache for those involved in construction, a situation that has worsened in recent weeks.

Several employees of stores specializing in construction materials that offer their goods in convertible pesos say that in 2017 they have not received cement

Several employees in the stores in the capital specializing in construction materials and that sell their goods in convertible pesos, told 14ymedio that since the beginning of 2017 they have not received cement.

The government has chosen to place the product in the network that sells in Cuban pesos, the so-called national currency, in the face of previous criticisms of excessive prices in the foreign exchange network. However, a network of corruption, diversion of resources and re-sales makes it almost impossible to get one of those sacks with the precious gray powder.

The government has turned over the sale of cement to the open markets in national currency, but the shortage continues for those who repair or build houses. (14ymedio)

The national cement industry has not yet recovered from the blow that resulted from the fall of Europe’s socialist camp and the withdrawal of the Soviet Union’s subsidies to Cuba. At present, six factories on the island managed to produce slightly more than 1.4 million tonnes of gray cement last year, a figure well below the 5.2 million achieved in the same period in neighboring Dominican Republic, a country with a comparable population (about 11 million inhabitants), according to a report from the Producers Association.

The government has assigned the Construction Materials Business Group (GEICON) to produce cement in each of its variants, in addition to other building materials such as aggregates, blocks, and flooring elements, along with asbestos, fibroasphalt and roofing tiles.

The sales and marketing director of the group, Rubén Gómez Medina, recently explained on national television that despite the sector’s recovery over the last five years, it still cannot meet demand.

“Since we started, the prices of aggregates have changed from one day to the next and no one can tolerate that.”

The situation becomes complex for self-employed masons, and also for those who are part of a non-agricultural cooperative. “As there is no wholesale market, when we are contracted to do a job we have to place responsibility for the materials on the customer,” says Carlos Núñez, who two years ago obtained a license for that occupation.

The entrepreneur remembers that at first they calculated a budget that included everything, the plans, the materials and the labor. “Since we started, the prices of aggregates have changed from one day to the next and no one can tolerate that.”

A bag of gray cement last year cost just over 6 CUC in an official store. In the open markets the same bag is sold in national currency at the equivalent of 7 CUC. The lack of supply has meant that in the underground market, where it is also scarce, the price doubles and in some areas reaches as high as 18 CUC.

Cement, along with pork or cooking oil, is one of those goods that set the pace of the everyday economy. Its disappearance or shortage is a direct blow to the population’s quality of life.

Of the more than 23,000 homes that were built during 2015, less than half were erected by the state. The rest were built by the private sector.

Now, for many, the only option is to buy gray cement on the black market, or to sleep outside one of the open markets all night to see if there’s an early delivery.

On the outskirts of Fe del Valle Park, mixed among the dozens of people who connect to the Internet in this popular Wi-Fi zone, resellers abound. The site has a reputation for being a place where you can find everything, “even 12 gauge electric cables for electrical installations,” a young man nicknamed El Chino proclaims without modesty.

So as not to be confused with a police informant or an inspector, the buyer should pronounce the question in the most roundabout way. “How’s the cement coming along, pal?” El Chino arches his eyebrows and with a precise professional air answers, ” P350, which is for mounting plates, goes out of here at between 10 and 12 CUC a bag and P250, for plastering, goes for 9.”

He pauses, as if he is sorry for what he is about to confess and adds, “But right now there isn’t any.”

Several cooperatives say that part of the production in the western area has been sent to the province of Guantánamo for the repair of houses damaged by Hurricane Matthew

At the Ministry of Construction (MICONS) the officials questioned do not clarify the reasons for the shortage, although several cooperative members engaged in construction assert that part of the production of the western zone has been sent to Guantánamo province to repair the houses damaged by Hurricane Matthew.

A MICONS employee, who preferred anonymity, does not agree with that explanation and insists that “since a group of measures to promote construction by self-effort was implemented, there was a building explosion that was not foreseen in the production plans for the materials… Important hotels are being built and the supply to those places can’t be allowed to fail, so it has been prioritized,” he adds.

The most recent version of the Foreign Investment Opportunities Portfolio describes the objective of the authorities to “promote the construction of infrastructure and industrial maintenance, mainly for the nickel, oil and cement industries.” But so far potential investors are wary of putting their money in ventures on the Island.

“What has happened is that the cement industry is bottoming out and can not withstand the pressure of the high demand,” an engineer with 30 years of experience in the sector, who prefers to be called Osvaldo – not his real name – to avoid reprisals for his statements, tells this newspaper.

“It’s a chain of inefficiencies that ends up breaking down at the weakest link: the customer”

In 2016 the country’s factories have had serious problems due to the lack of maintenance but transportation has also burdened the results. “We depend on the Cuban Railways to transfer part of the material used in cement manufacture,” Osvaldo said. “It’s a chain of inefficiencies that ends up breaking down at the weakest link: the customer.”

“No new equipment or parts are coming into the country. In many factories, the furnace engines, the mechanical couplings and the mills are badly damaged,” he adds.

“This industry is the engine of prosperity, because it is the one that allows houses to be built, people to have more amenities and there is progress,” Osvaldo proudly says. “But if we do not invest a good amount of money we will continue as we are, between improvisations and defaults.”

To illustrate his comment, the engineer shows the side wall of a newly built house that is still waiting to be plastered. “It’s because I haven’t been able to find the cement anywhere,” justifies the owner.