HAVANA, Cuba (Reuters) -- In his first direct challenge to U.S. President
                  George W. Bush's new administration, Cuban President Fidel Castro has
                  announced that the island was producing U.S. patented AIDS drugs and
                  threatened to manufacture other U.S. products for export.

                  Castro, in a Saturday speech to senior officials which was broadcast Sunday
                  evening, assailed the United States and its pharmaceutical companies for trying to
                  protect the patents of AIDS medications before the World Trade Organization.

                  Castro voiced strong support for South Africa and Brazil, which are allowing
                  local companies to produce cheaper generic versions of drugs in the anti-AIDS
                  cocktail to fight the disease, and announced Cuba was doing the same.

                  "Our country is producing the famous cocktail," Castro aid, adding later in his
                  speech that Cuba might manufacture and export other U.S. products, besides
                  drugs.

                  Castro did not say which of the several drugs used to treat AIDS that Cuba was
                  manufacturing.

                  A challenge to Bush

                  The Cuban president defended the patent violations as a response to what Cuba
                  views as similar U.S. infringements, using the island's well-known rum as an
                  example.

                  "Who is going to protest, I would like to hear a protest from those who have
                  stolen Havana Club, which is Cuban," said Castro, who proceeded to announce
                  local distilleries would begin production of Bacardi Rum, to cheers from his
                  audience.

                  U.S. courts ruled in 1999 that Bermuda-based and Cuban-exile owned Bacardi
                  Rum could distribute rum under the Havana Club brand, because the distilleries
                  were nationalized after Castro's 1959 revolution.

                  Castro threatened at the time to retaliate by producing U.S. brand name products.

                  The Havana Club brand is internationally recognized as Cuban. It is distributed
                  worldwide, in competition with Bacardi rum, by a Cuban government joint
                  venture with the French spirits company Pernod Ricard.

                  Bacardi's owners are important financial contributors to the U.S.-based Cuban
                  exile movement against Castro, and have pushed legislation like the 1996
                  Helms-Burton Act strengthening the embargo.

                  Castro's patent announcements this weekend may have been timed as a response
                  to the Bush administration's plans to nominate conservative Cuban American
                  Otto Reich as assistant secretary of state for Western Hemisphere affairs, the
                  administration's top Latin American policy position.

                  Reich, a former U.S. ambassador to Venezuela, has also worked as a Bacardi
                  lobbyist in Washington to strengthen the embargo.

                      Copyright 2001 Reuters.