HURRICANE SEASON 2008

Hurricane Paloma strengthens, heads for Cuba

By Shurna Robbins
GEORGE TOWN
(Reuters) –
Nov, 8, 2008

Hurricane Paloma strengthened into an "extremely dangerous" Category 4 storm on Saturday as it pounded the wealthy British Caribbean territory of the Cayman Islands and headed toward storm-battered Cuba.

Paloma's eye passed just to the east of Grand Cayman, the main island and home to most of the
more than 50,000 people in the important offshore financial center, but damage appeared to be
light and there were no immediate reports of deaths.

"There is no damage to central George Town, where the bulk of the financial sector is located,"
said Cindy Scotland, an official with the Cayman Islands Monetary Authority. "So there is no
reason to think there has been any damage in any way to the infrastructure of the financial
services sector."

"The Authority does not expect any reports of significant, if any, interruptions in business," she
said.

Cuba, already hammered this year by hurricanes Gustav and Ike, declared an emergency in central
and eastern parts of the island, canceled all national air and ground transportation and began evacuating hundreds of thousands of residents.

Authorities issued an "all-clear" early Saturday for Grand Cayman but cautioned residents to move
about carefully. Power was out in some parts of the island and the streets of George Town were
littered with tree branches.

Paloma's sustained winds increased to 140 miles per hour (225 km per hour) early on Saturday as
the storm hurtled across the group's smaller islands, Cayman Brac, home to 1,800 people, and Little Cayman, with a population of about 100.

Gov. Stuart Jack asked that the British auxiliary ship Wave Ruler head straight to the smaller islands after the storm passes.

"Paloma is now an extremely dangerous category four hurricane on the Saffir-Simpson scale," the
U.S. National Hurricane Center said.

Category 4 hurricanes can generate tidal surges up to 18 feet above normal and their winds can
tear off the roofs and blow out the doors and windows of small homes.

Hurricane Ivan had 160 mph winds when it slammed the Caymans in 2004, causing extensive
damage. But the islands and their solid structures are considered less vulnerable than other
Caribbean islands to the fierce tropical storms that churn through between June and the end
of November each year.

Paloma doused Honduras with heavy rains as it formed on Thursday, adding to misery in the impoverished Central American country where the United Nations estimates 70,000 people
have been made homeless by recent storms.

It posed no threat to U.S. oil installations in the Gulf of Mexico.

In Cuba, Paloma was forecast to beat a northeast path through central Camaguey and eastern
Las Tunas provinces. It was expected to weaken before hitting Cuba as a Category 3 storm,
the forecasters said.

"I don't want to talk or hear about hurricanes, because they have already driven me crazy.
First one came through from the north, now one is heading here from the south," Camaguey
resident Carlos Martinez said. "I hope another doesn't fall from the sky."

Ailing former President Fidel Castro put damage from previous storms Ike and Gustav at $8
billion and blamed global warming for the number and power of the storms this year.

In a written statement published on Saturday, Castro rejected any aid from the United States
before it was even offered, demanding instead that Washington lift economic sanctions tightened
by U.S. President George W. Bush.

"Dignified conduct will again be needed if the head of the empire, who has been the chief instigator behind the genocidal blockade against our country, were to again offer pitiful aid. It will most surely
be rejected," said Castro, who has not appeared in public since intestinal surgery in July 2006.

By 10 a.m. EST (1500 GMT), Paloma was about 130 miles east-northeast of Grand Cayman Island
and about 140 miles southwest of Camaguey, Cuba, and moving east-northeast near 9 mph, the hurricane center said.

(Additional reporting by Marc Frank in Havana; writing by Jim Loney, editing by Vicki Allen)