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Cuba Replaces Basic Industries Minister Over Mismanagement

Sept. 20 (Bloomberg) -- Cuban President Raul Castro replaced the island’s minister of basic industries, citing mismanagement and a failure to attract investment.

The move to dismiss Yadira Garcia Vera is part of Castro’s reforms to reduce inefficiency that is crimping economic growth, said Arch Ritter, professor of economics at Carleton University in Ottawa. The minister oversees the energy and mining sectors, including the island’s largest commodity export, nickel.

“There are long-term question marks over the nickel sector,” Ritter said in an interview. “For the last 20 years, nickel has been a bright spot in the Cuban economy.”

Garcia Vera had been at the post since 2004. She will be replaced by deputy minister Tomas Benitez, according to a statement on the website of the Communist Party newspaper Granma. Garcia Vera’s dismissal comes a week after the government announced it would lay off 10 percent of its workforce by March in a bid to reduce waste.

The government’s statement criticized Garcia Vera for allowing “deficiencies” in the ministry and “weak control over resources set aside for investment and production,” without giving further details.

Garcia Vera also served as a liaison with the family of Elian Gonzalez in 2000 when Cuba negotiated the child’s return to the island from Miami, according to a biography posted on the website of the University of Miami’s Cuba Transition Project.

Nickel Demand

Demand for refined nickel has dropped worldwide due to China’s increased production of nickel pig iron, a substitute used in stainless steel production, Ritter said. Cuban production of nickel products fell 2 percent in 2009 to 8,648 metric tons, according to government statistics.

Michael Edmonds, spokesman for Toronto-based Sherrit International Corp., Cuba’s largest nickel producer in a joint venture with the government, didn’t respond to request for comment.

Fidel Castro, 84, began transferring control to his brother Raul in July 2006, when he underwent intestinal surgery, and officially stepped down as president in 2008.

Raul Castro replaced the foreign minister, finance and planning minister and the secretary of the council of ministers in a March 2009 Cabinet overhaul.

To contact the reporter on this story: Blake Schmidt in Granada, Nicaragua at Bschmidt16@bloomberg.net

To contact the editor responsible for this story: Joshua Goodman at jgoodman19@bloomberg.net

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