The Discreet Charm of Cuba

Cuba is far from being an iconic destination for luxury economics. As a matter of fact, the island nation precisely is the opposite. A land of scarcity, meager economic activity and restricted tourism services. And while Cubans continue to be a leading force in music inspiration and creation, lack of fundamental freedoms has curtailed their artistic talent. The question then arises, what is Chanel seeing in Cuba that we fail to recognize?

I believe that the honorable pioneer of fashion and style is seeing in Cuba the birth of a high end products workshop that could provide luxury goods makers with a respite from widespread forgery. Most luxury goods makers out sourced their manufacturing tasks to Asia. China. Thailand. Vietnam and Bangladesh to a lesser degree became the workshops for apparel and accessories. But they also became the factories for forgery. Given the relative higher productivity rate coupled with meager workplace conditions, the margins for luxury goods grew fast and fat.

This enticed the factory workers who soon learned the value of the products they were manufacturing to copycat them with original materials. As counterfeit became a vehicle to enter middle class status by luxury goods factory workers the practice attracted attention groups and organizations  interested in laundering money. How comes? You can sell a counterfeit product claiming that it is original with a very high price tag.

But the manufacturer of a counterfeit good charges a much reduced prize which is the real acquisition price. The difference between what is paid and what is claimed to be paid serves the purpose of laundering money from corruption or from a whole panoply of very ugly crimes. It did not take long for organized crime to realize the laundering virtues of forgery. And it took over the promising business.

Coming back to Cuba, the island is a virgin land for luxury goods but most Cubans are outstanding technicians and artisans. These skills can be put to create value in the industry.  Cubans could indeed become  leaders of apparel production; embroidery; and lacemaking at a relatively lower compensation per hour than their peers in the developed world.

They will never be able to compete with Asian workers in compensation and productivity  but the nation will be able to assure the world of fashion, apparels and accessories a better  finishing and quality. Cuba would better guarantee safety for designs and products, as its government would likely maintain control over production while the US can better monitor the emergence of counterfeiting bubbles given that it would be the market of choice for Cuban products. And this emerging market will most probably be grabbed by Chanel !!