IT would have been difficult to imagine that the creation of the Havana International Conference Center, inaugurated in 1979 to host the 6th Summit Conference of the Non-Aligned Movement (NAM), would be the antecedent to the most comprehensive of Cuban service providers in terms of the organization of national and international congresses, fairs, and exhibitions, as well as hospitality for businesspeople, officials, and diplomatic personnel, residing here or visiting the island.
Following the reorganization of the country’s institutions, in 2009 the need to transform the Havana International Conference Center enterprise into a Central Business Management Organization was raised, and in January 2011 the Palco Enterprise Group, or PALCO GROUP, was created.
With the aim of promoting more dynamism, flexibility, and efficiency in its business management, in February 2015, other entities joined the PALCO GROUP.
Subordinated to the Council of Ministers and with Abraham Maciques as its president, the PALCO GROUP is currently composed of a dozen enterprises which, with the incorporation of new services and facilities, have brought with them the concentration and interaction of highly specialized, professional, and quality services.
DEFENDING ITS VANGUARD STATUS
Brimming with pride, Abraham Maciques recalls that they “were the first to develop congresses in Cuba,” despite the fact that, once the NAM Summit was over, it was thought that the Conference Center would become “a kind of white elephant,” an entity unable to generate income of any kind. It was then, Maciques emphasizes, that we advocated for the facilities to host different types of events.
“Even the Havana International Trade Fair started at the Conference Center. Then Pabexpo was created and that also became too small. Then came Expocuba and already that can’t keep up,” Maciques adds. He tells Granma International, “We are sure that in the coming years we will have to develop a new fairground, which has all the conditions that we require.”
The Havana International Conference Center has always been “the rearguard of the vanguard,” in the words of Comandante en Jefe Fidel Castro. While small events, whether personal or professional, are hosted at the site, every year between 90 and 110 congresses are held here, the official explains.
Maciques also points out that these activities have contributed to challenging the economic, commercial, and financial blockade that the United States government maintains against Cuba, as they have allowed foreign visitors to gain an insight into the national reality and “more than a few of them have been U.S. citizens.”
There has been no significant political, economic, social or other event, such as the internationalist missions, the Battle of Ideas, or the Colombian peace talks, in which the Conference Center has not played a decisive role, Maciques notes.
For example, when Operation Miracle began, PALCO had the responsibility of guaranteeing all the logistics required at the facilities, such as schools, hotels and hospitals, which were used to house and treat patients.
The political significance of the PALCO Group, Maciques explains, is not only due to the services provided to the diplomatic corps in Cuba, but also those offered to official government delegations, from their arrival at the airport to their point of departure.
ESSENTIAL TO THE COUNTRY’S ECONOMY
In the midst of a context in which Cuba is pushing for foreign investment, as an essential part of a long-term development program, PALCO is preparing to take on increased demand in the services sector. With the arrival of new economic players, whether investors or tourists, the market is set to become increasingly demanding.
According to Maciques, with the vision to become a leading organization in the strategic management of its enterprises, and in the provision of services and products of a high standard, enjoying social and international recognition, in 2015 PALCO reached sales of more than 280 million pesos, 54 million of which were for exports of services, one of the areas prioritized by the Ministry of Economy and Planning.
“Although we made estimates to end 2016 with a turnover of some 251 million, as we have been able to import half of what we could in 2015,” Maciques explains, “we expect to reach 292 million by the end of the year.” This has been achieved due to new products and events held that “generated fewer expenses in hard currency and more income in freely convertible pesos.”
The head of the business group also stressed that in addition to having always surpassed plans, constant checking and encouragement of workers has been a key aspect of this success.
According to Maciques, the fundamental aspect is the professionalism that has characterized PALCO’s work over 40 years, always committed to Fidel and the Cuban Revolution. Equally, he adds that the supposed white elephant had become an efficient enterprise just two years after its founding, as it was already self-financing.
Meanwhile, Pablo Sosa, first vice president of the PALCO Group, assured that the stability of its human capital and integrated services are further key strengths. “It would be difficult to find something one wants to do in Cuba today, that PALCO couldn’t offer,” the specialist notes.
COMPREHENSIVE SERVICES FOR SPECIFIC MARKETS
Five products among the PALCO Group’s portfolio of services stand out, supported by an infrastructure and staff trained to promote the wellbeing and satisfaction that clients require.
On the one hand, the group’s event service guarantees the organization (documentation, interpretation, event program, budget), logistics (rooms, technical equipment, accommodation, gastronomic services), national and international promotion, and successful presentation of fairs, exhibitions, congresses, and other functions such as weddings, etc.
Meanwhile, the accommodations offered include adequate facilities to meet the expectations of those attending events and fairs, and new clients with greater demands and purchasing power. In this regard, several secure protocol houses and the Hotel Palco stand out among the group’s offers.
As for gastronomic services, PALCO offers spaces with attractive options including Creole and international cuisine, both in refined restaurants and in settings that are totally natural and ecologically friendly.
A wide range of complementary services are offered including, among others, printing services, shopping malls, specialized stores, Casas del Habano (cigar stores), the import of goods, a Customs and Transit Agency, decorations, flower and plant marketing, design and construction of rustic works and the maintenance and repair of equipment. Specifically, in PALCO stores, top of the range consumer products are sold, Maciques explains.
He notes that as part of its parcel service, the group handles shipments to Cuban internationalist workers abroad. Such has been the success of this service that two package reception points were created.
With a strong position in the tourist sector, which covers both Cubans and international visitors, PALCO offers personalized treatment, including for businesspeople seeking comfortable, excellent, and safe locations. According to Maciques, these clients select well-known places and demand high quality standards: “It is necessary to take into account that a tourist attending fairs, spends four or five times what an average tourist does.”
Another clientele base are foreign and national executives and representatives of different firms and private, mixed, or state institutions, who also demand leisure and recreation services, with distinguished status and varied offers. On this point, Sosa notes that PALCO offers its partners a unique service in Cuba: the Club Habana.
Equally exclusive are the services provided to diplomatic personnel and embassy officials accredited in the country. Maciques states that the group caters to some 120 embassies in Havana, as well as international organizations.
Sellers, intermediaries, and clients of different companies that use incentive travel as a tool to motivate employees or partners in the interests of the institution constitute another significant market. Companies purchase packages through the specialized agents in their countries which contract the services of Cuban entities, and PALCO helps to develop this area of tourism.
In this regard, Sosa explains that the group has relations with an extensive network of international agencies and has an international sales area, where it sells its own product, with authorization from the Ministry of Tourism. “We are even responsible for transporting our clients and accommodating them in tourist facilities that do not belong to PALCO.”
Sosa notes that 80% of the group’s sales are made online, through a payment gateway and the use of virtual stores. He added that PALCO is currently innovating in this area with online flower sales, through the CARIFLOR Enterprise.
PROPERTY MANAGEMENT
According to Alberto Rivero, director general of the PALCO Real Estate Enterprise, “We are responsible for the maintenance and repair of embassies, residences and houses, and rent these properties. We are even responsible for the maintenance of the Karl Marx Theater.”
Maciques adds that through the group’s employment agency, local personnel for embassies are hired, currently totaling around 2,500 people. This particular activity generates almost seven million dollars annually, he notes.
Some 1,500 houses, residences, and apartments are rented to the diplomatic corps and foreign businesspeople, located mainly in the municipalities of Playa and Plaza de la Revolución. It is worth noting that today, after years of construction work, the Someillan building has been completed, which has 31 floors, 375 square meter rooms and a privileged sea view. By next month, Maciques informs, this property will be 50% occupied.
According to Maciques, the real estate sector must be boosted, as there are currently not enough houses and apartments for diplomats and officials, due to the increase in the number of embassies in recent times, and especially following the reestablishment of diplomatic relations with the United States.
“There have always been nations that have viewed us through the lens of the North American country,” he summarizes. Since December 17, 2014, more than eight new embassies have opened in Havana, including those of Saudi Arabia, Qatar, Kuwait, the United Arab Emirates, the Seychelles, Kenya, Niger, and Gambia.
Vice President Sosa adds that the group advocates a policy to make the capital’s 5th Avenue a high standard real estate zone, for which it already has 15 approved development plots along this important stretch. According to Sosa, demand is currently much higher than supply in this sector.
Even the schools attended by the children of these foreign residents are facilitated by PALCO. The fact that most of our properties are 70 or 80 years old forces us to undertake constant repair works, Rivero reaffirms. In addition to the 30 apartments in the Someillan building that we are already marketing, two towers in that same building are due for repairs and two more properties are set to be refurbished in 2017, located on First Avenue and B Street.
STRATEGIES FOR 2016 AND GUIDELINES FOR 2017
Planning is one of the key words in the comprehensive work of the PALCO Group. The growth of the group allowed for the planning of voluntary surplus reserves, starting with 2015 profits, for additional payments to workers for economic efficiency, development, and research, and the compensation fund.
From the inclusion of Information Technologies and Telecommunications, preceded by a technological remodeling of infrastructure to create its own corporate network, the study and management of investments and the administration of finances, to the implementation of a logistical monitoring system that ensures stability in the operations of the Group's enterprises, PALCO ensures constant updating of its training and an effective internal auditing system.
First Vice President Sosa draws attention to the relationship between PALCO and Fira Barcelona, one of the most important trade show companies in Europe, with which two fairs have been held to date, with four more expected to be held in the Pabexpo venue in 2017. This is a solid example of the expansion of PALCO, through its links with specialized global organizations, Sosa remarks.
Maciques explains that in the same way, the group has proposed to expand tourism, by creating further hotels, expanding the International Conference Center, which has already become too small, and investing in the maintenance of facilities that have been in use for over 37 years.
“We have consolidated our organization and efficiency and, although we have problems, we can always do more. In this group it can not be said that a task can not be done. ‘No’ can not exist here. We must seek the formulas, the means, to solve whatever issue arises. We have confidence in ourselves because we are serious and responsible,” Maciques concludes.
