Cuba offers to pay off debt with rum

PRAGUE -- The Czech Finance Ministry says Cuba has offered an unusual way of repaying its Cold War-era debt - its trademark rum.

Finance Ministry spokesman Michal Zurovec said Thursday that Cuban authorities have proposed to pay back $276 million to the Czech Republic from the time both countries were part of the communist bloc.

If that proposal becomes reality, the Czech would have enough Cuban rum for well over a century. According to the Czech Statistics Office, the Czechs imported rum from Cuba worth over $2 million last year.

Zurovec says that the Czechs would still prefer the debt was at least partly paid in cash.

In the past, North Korea wanted to repay its $10 million debt with products made with ginseng.

Cuba is saddled by tremendous external debt of almost $25 billion, or 31 percent of the country’s gross domestic product, though it has lately taken steps to lift some of that burden.

It has reached debt agreements in the last two years with Japan, Mexico and Russia, which forgave some $30 billion in Soviet-era debt in 2014.

Cuba reached a deal in December with members of Paris Club of mostly European creditor nations that forgave $8.5 billion of $11.1 billion official debt it had defaulted on through 1986, plus charges. Repayment of the remaining debt was structured over 18 years.

Cuba also owes at least $1.9 billion as a result of its nationalizing of American-owned businesses and expropriating of U.S.-owned property in the wake of the 1959 Cuban revolution that brought Fidel Castro to power.

Cuba counters that the United States owes Havana billions of dollars for its half century economic embargo of the island.