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Approaching midnight in Miramar, the streets are dark in one of Havana's most pleasant residential districts, popular with diplomats and foreign businessmen.

Fifth Avenue, a broad, tree-lined boulevard, appears to be practically deserted. Police officers patrol outside diplomatic residences.

Yet every few blocks, young women dressed in garish clothes, sometimes standing by themselves, often in pairs, appear out of the gloom and hail passing cars. Frequently a car stops, a brief conversation ensues and the women hop in.

It's a scene being repeated every night up and down the city's seafront district. Lured by tourist dollars, Havana's young hustlers, both men and women, stake out hotels, bars and discos, looking to be picked up by visitors to the island.

Cuba's authorities, who once boasted that prostitution, gambling and other capitalist evils had been eliminated by the 1959 communist revolution, now turn a blind eye to the return of the sex trade.

Two years ago Cuban leader Fidel Castro recognized that prostitution had made a comeback, but argued that, thanks to social advances made by the revolution, Cuba could at least boast the cleanest and best-educated hookers in the world.

But the growth of prostitution in Cuba in the past couple of years can no longer be so easily dismissed. From being an inevitable byproduct of economic conditions, it has turned into a thriving and highly organized mini-industry. Prostitution is conducted openly in nightclubs and hotels, where security guards charge $20 to let guests take companions up to their rooms.

On the street, Cuban men frequently pester tourists to inquire if they are in need of female company or a quiet room to rent for the night.

Travel companies in Europe and Latin America are packaging single male trips to Cuba, using code names such as "Cuba Amor," or "Cuba Love."

The root of the problem is Cuba's dependence on the dollars generated by a booming tourist industry, which has grown more than 40 percent in the past two years. Forced to rethink their economic strategy after the collapse of Cuba's commercial ties with the former Soviet bloc, Communist Party leaders are banking heavily on the new revenue from tourism.

The message seems to be, if sex brings in the tourists, let them have it.

That's the word spreading around the capitals of Europe and Latin America, where glossy magazines have reported that Cuba is now one of the world's leading fleshpots.

In March, the Italian travel magazine Viaggiare named Cuba the "paradise of sexual tourism," after an informal poll of travelers, tour operators and journalists. Cuba was ranked higher than Brazil and Thailand in the magazine's special report on "erotic tourism" worldwide.

It certainly looked that way one recent Sunday.

Two women appeared at a Fifth Avenue street corner as a car with three Italian men approached. "Chicas! Chicas!" (Girls! Girls!) shrieked one of the men as the car came to a halt.

Within seconds, Tania, 17, had thrust her body halfway through the driver's window, locking her arms around the neck of a sun-tanned Italian in his 20s.

After some groping and heavy kissing, the man got down to business. In broken Spanish and using hand signs, the tourist explained that he and his passengers wanted her to spend the night with them.

Negotiations broke down when Tania refused to abandon her friend, Judaisy, 21, who stood close by, illuminated by the half light of a street lamp.

No doubt confident of satisfying their quest down the road, the men drove off. Less than a minute later Tania and Judaisy were bargaining with two more Italians who pulled over in another car.

Earlier that evening, Tania and Judaisy discussed what prompted them to walk the streets at night, and on the condition that their last names not be used, allowed a photographer to observe how they operate.

"There's nothing to do and nowhere to go unless you have dollars," said Tania, who studies English during the day.

Judaisy, who sells black-market yogurt, lives with her mother and young son. "My boy starts school next week and he has no shoes," she said. "The only shoes available are in dollars."

It's a common complaint on the island. The economic crisis has made a mockery of the national currency, the peso, and state salaries. An average monthly wage is barely worth $10 on the black market.

"You have to be inventive to survive," goes a popular Cuban saying born of these hard times. To augment their salaries, Cubans have had to resort to a host of illegal activities _ poaching, stealing and black-market trading _ to make ends meet. For many, selling sex is just another means of survival.

In fact, most Cubans don't call them prostitutes at all. Instead, they are known as "jineteras," from the word jinete, meaning jockey. It's a phrase that helps distinguish them from traditional ladies of the night, since their aim is often simply to ride along with tourists as companions, both day and night. They seek money and friendship. They don't always expect cash, and often settle for gifts _ a trip to the beach, clothes or a healthy lunch in a tourist restaurant. But sex is almost always for sale as well, for $20 to $60 a night.

"If you're lucky they treat you well and invite you to eat and go to a disco, that's all. They don't want to touch you. But sometimes it means going all the way . . . spending the night," Tania said.

The goal for many jineteras (pronounced hee-NEH-te-ras) is to marry a foreigner and move abroad. But jineteras say Cuban women have increasingly fallen victim to unscrupulous Europeans working as talent scouts for prostitution rackets.

A Spanish-run nightclub _ Ache _ in Havana's new five-star hotel Cohiba, is a mecca for the best-dressed jineteras. The dance floor and bar area pulsate with prostitutes every night. Three-quarters of the customers are women, and most enter unaccompanied.

Judith, 19, an elegant woman wearing a gold necklace with the English words "Love You" around her neck, described how she recently turned down an offer to "work" in Spain.

"I met a Spanish man named Marco who goes around bars and restaurants looking to hire girls," she said. "He told me Spanish men like mulatto women like me. He said he could arrange everything if I wanted to go (to Spain)."

Judith said she rejected the offer after a friend warned her that Cuban women were being exploited in Spain. She also said her mother and 2-year-old daughter depended on her.

At least one company in Spain offers clients visiting Cuba a catalog of women to serve as "companions" during their stay. Spanish officials suspect this is a ruse for prostitution but are unable to intervene unless minors are involved or the scheme is used to smuggle Cubans out of the country on fraudulent documents.

Tania recalls being taken by a friend to a house in Havana where a European modeling agency was supposedly auditioning girls for a catalog. "They were taking photos of girls in their underwear. I didn't like it," she said. "I heard later that the police raided that place."

The attitude of the authorities is one of watchful tolerance, while accepting no blame. Although prostitution is illegal, police rarely make arrests and instead only interrupt street soliciting when the jineteras stray too close to diplomatic residences. Some embassies have complained that the night life in Miramar is upsetting for diplomats with young children.

Child prostitution also has appeared on Havana's streets. But when a state-run radio station prepared a program about it, featuring a 13-year-old hooker and her pimp mother, it was censored. Officials objected to the program's conclusion, that the growth of prostitution was the product of economic necessity.

A softer report was recorded, with the 13-year-old edited out, and the blame was placed on poor individual morality.

Women's groups in Cuba blame prostitution for a rise in the rate of abortions, estimated last year at 60 per every 1,000 women between the ages of 15 and 44. That is the highest rate in Latin America, and more than double the United States'.

However, Cuba has one of the lowest levels of AIDS infection in the world, with 7.3 cases per million people, compared with 241 cases per million in the United States, according to the World Health Organization.

Many Cubans are angry that the government has allowed prostitution to be conducted so openly, in order to please sex-hungry tourists.

Sitting in the square outside the Cohiba hotel, two young Cuban couples questioned what was becoming of their country, as prostitutes and male pimps openly solicited clients on the hotel steps.

"It makes me sick, it really hurts," said Angel, 27, a set designer for state television who described himself as a young revolutionary and admirer of Fidel Castro. "It's like we are selling the women of Cuba. Is this country so screwed up that these are the only kind of tourists we can attract?

"You watch these ugly foreigners walking off with the most beautiful women in Cuba. It's degrading. Where's the respect? What the hell is going on?"

One of the few places where prostitutes are hard to find these days is the newly reopened Two Brothers bar, in the port district. A notorious mafia hangout and watering hole for American sailors in the 1950s, it has yet to make a hit with Havana's modern-day tourists.

No doubt they'll find it soon enough. With a record 700,000 foreigners expected to visit Cuba this year, the government can't build new hotels or restore the famous old haunts fast enough.

Cuban officials hope that prostitution will subside as the economy improves with the help of outside investors. But it may be a long time before the jineteras are out of business. So far foreign investment has only brought them more clients, and Cuba's modest economic growth continues to be outpaced by the sex industry.