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Putin forgives $32 billion in debt from cuba

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  • Putin forgives $32 billion in debt from cuba

    Russian President Vladimir Putin is currently on a grand tour of Latin America. His first stop is in Havana, Cuba. Ahead of arriving in Cuba, Putin decided to bestow a gift upon the Cuban government. With one swift signature, he eliminated $32 billion of Cuba's debt, left over from the Soviet era.

    Cuba isn't completely off the hook. They will be required to pay back just $3.2 billion over the next ten years, a 90 percent decrease from what they previously owed. The first payment is due in October, and will be made from the National Bank of Cuba to the Russian lender Vnesheconombank.

    Cuba has been working to restructure its debt over the last few years. In 2011, Cuba was able to restructure a $6 billion debt with China. Other nations have also forgiven their debt. In 2012, Japan forgave $1.4 billion and more recently, Mexico forgave $478 million in debt.

    While it may be nice to think Putin was simply showing a kind gesture to the Cuban government in forgiving this debt, it may be motivated by oil. Right now, the Cuban state oil company CUPET and Russia's Rosneft are in negotiations for a very lucrative deal. Russia and Cuba are close allies. Last year, trade between the two countries totaled about $200 million.

    Cuba has oil reserves of between 4 billion and 20 billion barrels, though likely in the area of 9 billion barrels. With the oil price at $110 per barrel, this deal could bring around $900 billion. This is comparable to the deal Rosneft currently has with Exxon Mobil in the Arctic. As Russia stands to earn $900 billion (perhaps more) from Cuba in oil, forgiving a $32 billion debt may be worth it to push contract negotiations in Russia's favor.

    Of course, perhaps it has nothing to do with oil at all, and Putin was just in a rare good mood that day.
    So russia's gonna be pumping oil in cuba by this time next year. China might join in as well.

  • #2
    Originally posted by 03mustangdude View Post
    So russia's gonna be pumping oil in cuba by this time next year. China might join in as well.
    There are Chinese owned oil rigs along the northern border of Cuba already.

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    • #3
      china seems to own a lot of things lately
      WH

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      • #4
        Just open up travel to Cuba already and lift the sanctions. Who cares they are socialist and all that jazz.

        It would be an awesome resort destination if we could just drop this whole thing.

        Not to mention all the old cars we could get our hands on.

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        • #5
          Originally posted by IHaveAMustang View Post
          Just open up travel to Cuba already and lift the sanctions. Who cares they are socialist and all that jazz.

          It would be an awesome resort destination if we could just drop this whole thing.

          Not to mention all the old cars we could get our hands on.
          To hell with Cuba, we should be enforcing the embargo with ship mines. Until the people decide to revolt and kill all of the communists they can keep on suffering. Read up on some history, the Cubans haven't been sitting at home eating popcorn for the last 50+ years. They've sent combat troops all over the world to fight against our allies. Not to mention all of the organized crime they've supported here in our country and all over South America.

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          • #6
            They were supporting organized crime even before Batista arrived on the scene. As much as some people love to hate Cuba, usually the best weapon in fighting countries who espouse communism is to show them what they're missing. Cuban people aren't as brainwashed as, say, North Koreans...compared to them cubans are practically liberated. Show them what kind of life they can lead by overthrowing communist oppression and maybe we can resume relations like we had in the early 1900s.

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            • #7
              Originally posted by dilbertJ
              Debt forgiveness is a fantastic thing for a lot of people, as it means less than the whole of a debt has been paid though the debt has been happy. However, it's regarded as taxable income and the lapse of a debt forgiveness tax break for foreclosures or short sales of homes is set to bite some taxpayers. With a personal loan, you can pay your taxes.

              Moreover, the act of debt forgiveness can take place between nations such as the debt relief given to Cuba by Russia.The creditor nations may choose to engage in a loan writeoff rather than cripple the internal economy of the country. It isn't unusual for this to take place if there is a strong indication that the collapse of the economy of the stricken country may in turn have an adverse effect on the global economy. Isn't it a win-win situation?
              I spent a weekend at a combat ranch. You know where they shoot red paint, but it sounds stupid to you.

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              • #8
                Well, time for the real thing, Bill. All you gotta do is pull the trigger.
                .

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                • #9
                  Oh things should get better in two years when Hillary is president

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                  • #10
                    Originally posted by Trip McNeely View Post
                    I spent a weekend at a combat ranch. You know where they shoot red paint, but it sounds stupid to you.
                    That dude has no idea what the fuck he's saying.
                    ZOMBIE REAGAN FOR PRESIDENT 2016!!! heh

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                    • #11
                      Originally posted by YALE View Post
                      That dude has no idea what the fuck he's saying.
                      I read the part about the personal loan for bills and i was like "umm..
                      WH

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