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Monday, December 22, 2014

U.S. business faces game of catch-up if Cuba sanctions are cut, (TSE: S.TO)

International rivals have a clear head start in Cuba but U.S. companies could catch up quickly if the economic embargo that has kept them away is dismantled in a new era of cooperation between Washington and Havana. Cuba's inhospitable regulatory environment under communist rule has made doing business difficult and costly for foreign businesses, limiting investment.The domestic economy is also small with low salaries severely limiting retail businesses and inefficient state-run companies a drag on productivity and growth.Nevertheless, hotel companies such as Spain's Melia Hotels International and France's Accor, Canadian miner Sherritt International Corp, Britain's Imperial Tobacco and French beverage giant Pernod Ricard have survived and profited."We've found it to be quite a stable and good place to do business and have had a lot of success there," said David Pathe, the chief executive at Sherritt, which has been in Cuba for 20 years and has joint ventures with the government in nickel, oil, gas production and electricity generation.

Shares of S fell by 4.95% or $-0.16/share to $3.07. In the past year, the shares have traded as low as $2.16 and as high as $4.90. On average, 1416330 shares of S.TO exchange hands on a given day and today's volume is recorded at 1435463.