HAVANA (AP)--Giant U.S. food distributor Sysco Corp. (SYY) said Wednesday it's working with Cuban officials to increase sales to the island's tourism industry under an exception to the U.S. trade embargo.

So far, the Houston-based company has sold only about $500,000 worth of food to the country since late 2003, said David Dickson, president of the company's Alabama operation.

But as North America's largest food distributor, potential for increased trade is huge. Sysco already distributes food products to more than 420,000 restaurants, schools, hotels, hospitals and other customers in the U.S. and Canada.

Dickson said that Sysco's Alabama operation was working with Cuban food import officials "on a strategic plan to provide world class food products to the tourism industry."

Dickson indicated that other potential markets for Sysco in Cuba include hospitals and schools.

"We believe that Sysco has huge business opportunities in the Cuban market," said Pedro Alvarez, chairman of Cuba's food import company Alimport.

Most trade between the U.S. and Cuba is prohibited under sanctions in place more than four decades.

But a 2000 U.S. law created an exception to the embargo, allowing for the direct, commercial sales of U.S. farm goods to Cuba on a cash basis. Cuba began buying U.S. food under the law in late 2001.

In June, Sysco acquired International Food Group Inc. of Plant City, Fla., to expand its presence outside of North America. Terms of the deal weren't disclosed.

International Food, with sales last year of $77.8 million, supplies products to fast-food restaurants in the Caribbean, Central and South America, Europe, Asia and the Middle East.

Sysco was No. 66 on the Fortune 500 list of the largest U.S. companies in 2003, with sales of $26.1 billion.
 

(END) Dow Jones Newswires

08-11-04 1544ET