Jan. 22 (Bloomberg) -- Alcatel-Lucent SA began laying a Venezuelan-financed underwater fiber-optic cable that will connect the South American country with Cuba, a first for the island nation.

A French boat arrived in Venezuela on Jan. 16 carrying the 1,630-kilometer-long (1,011-mile) fiber-optic cable that Alcatel-Lucent will lay in the Caribbean Sea between Camuri, Venezuela, and Siboney, Cuba. The cable will reach Cuba in two weeks, Science and Technology Minister Ricardo Menendez said in comments carried on state television.

A 48-year-old U.S. trade embargo has prevented Cuba from linking to a network of underwater cables, forcing it to rely on satellites for its Internet and telephone connections. In January 2007, Venezuela and Cuba signed 16 accords, including one on the cable line, deepening industrial ties between them.

“One day that terrible, unjustified and arbitrary blockade of Cuba by the world’s most powerful government will end,” President Hugo Chavez said Jan. 17. “Perhaps this cable will even reach the United States in the future.”

The government hasn’t disclosed the cost of the project. Alcatel-Lucent Venezuela President Fernando Sosa was quoted in El Mundo last May saying the cable will cost $70 million.

Venezuelan and Cuban technicians in both countries will administer the cable through the bi-national joint venture Telecomunicaciones Gran Caribe SA, according to a government statement. The cable, which will be completely installed by July, also can be used by Jamaica, Dominican Republic and Haiti.

The cable will include a 230-kilometer extension to Jamaica, Menendez said.

Alcatel-Lucent, the world’s biggest supplier of fixed-line phone networks, is based in Paris.

--Editors: Sylvia Wier, Theo Mullen

To contact the reporter on this story: Corina Pons in Caracas at crpons@bloomberg.net; Jose Orozco in Caracas at jorozco8@bloomberg.net

To contact the editor responsible for this story: Joshua Goodman at jgoodman19@bloomberg.net

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