Twenty years ago, when Cuba’s tourism industry was still in its infancy, a well-known Dominican economist attending a Havana conference declared: “Thank God for the U.S. embargo. If it’s lifted, the Caribbean will have to meet its biggest rival.”

These days, Cuba has indeed become a serious competitor not just for the neighboring Dominican Republic but many other major Caribbean tourist destinations from Barbados to the Bahamas.

Argentina’s Palermo Business Review says “Cuba has reaped the benefits of tourism to improve its economic status in recent years. Its growth has been phenomenal.” In a recent edition, the Guía de El Viajero [Traveler’s Guide] published by Spain’s influential newspaper El País, called Havana “the safest city in Latin America and the Caribbean.”

And earlier this year, the Barbados-based Caribbean Tourism Organization ranked Cuba second in overall value, exceeded only the Dominican Republic.

Last year, Cuba’s tourism income reached $2.6 billion, up 4.4% from 2011 figures. That’s according to Tourism Minister Manuel Marrero Cruz, speaking at last month’s FIT 2013 tourism fair in Varadero. Significantly, 570,000 local Cubans stayed at island hotels last year. While Marrero didn’t disclose figures on import expenditures, he did say that daily income per tourist now exceeds 104 CUC.

He also revealed that Cuba’s tourism transport fleet now consists of 350 first-class buses and 4,360 rental cars, and that 65% of the island’s 60,552 hotel rooms are located in four- and five-star properties.

Meanwhile, eight hotels will be completed this year: Coralina and Flamingo II (Cayo Coco); Palacio de Iznaga and Panchito (Trinidad); Alabastro (Holguín); Piedra Movida (Cayo Santa María, Villa Clara), and two luxury hotels along Ancón Beach (Trinidad).

In addition, the following existing resorts will be expanded and upgraded: María La Gorda (Cabo San Antonio, Pinar del Río); Prado Costa Verde and Playa Pesquero (Holguín) and the Internacional and Paradisus Princesa del Mar (Varadero).

Cuba’s tourism industry is aiming ever higher, well above figures published as recently as a month ago (see CubaNews, May 2013, page 1). Officials say they’re working to offer a variety of services and leisure activities, as well as sophisticated luxury options and some significant mega-projects.

Marrero’s ministry now expects Cuba to have 85,500 hotel rooms by 2020, up from the previous estimate of 78,000. In addition to what’s already been reported, Cuban and European companies will develop a 10,000-room project in the vicinity of Antilla (Las Tunas) at Península de Ramón, along Carmona, Caimán and Baracutey beaches.

Frank P. Oltuski, marketing vice-president at Gaviota, recently announced that a huge, modern marina will be built at Punta de Hicacos, with berthing space for 1,300 yachts. “This will be Gaviota’s biggest investment and one of the most important in the Caribbean,” Oltuski said, noting that the marina’s location puts it close to Varadero’s major hotels, protects it from northeasterly winds.

Next to that marina, Spain’s Grupo Meliá will build the 423-room Hotel Marina Varadero, according to Francisco Camps Orfila, deputy director of Melia Group Cuba.

A number of historic, boutique hotels in Old Havana these include the Packard, New York, Red, Malecón and Prado will be upgraded and remodeled, while the Manzana de Gómez will be completely remodeled.

In addition, large and famous hotels like the Habana Libre, Comodoro and Riviera are in line for major capital repairs. Finally, the Martí Theater and the legendary Sloppy Joe’s are being completely restored.

In all, Cuba’s strategy to develop its tourism industry between now and 2020 will require billions of dollars’ worth of investment by foreign partners. And a key component of this 2020 strategy is the coming investment law, soon to be enacted by the Castro government.

It isn’t an accident that Cuban newspapers like Granma have recently praised the role of foreign investors throughout Latin America something that would have been considered blasphemy only 10 years ago.