Monday, November 12, 2007

For U.S. Exporters in Cuba, Business Trumps Politics


John Parke Wright, a Florida cattle farmer, rode with a Cuban farmer, one of the diversions for visitors to the trade fair in Havana last week.


Gov. Dave Heineman, Republican of Nebraska, center, with Pedro Álvarez Borrego, who is in charge of Cuban food imports, below, signed an $11 million deal with Cuba. Expanded trade is “good for America,” Mr. Heineman said.

The New York Times

By JAMES C. McKINLEY Jr.
Published: November 12, 2007

HAVANA, Nov. 11 — A trade fair in Communist Cuba is perhaps the last place you would expect to find a Republican governor from the American heartland. Yet last week, Gov. Dave Heineman of Nebraska was here to sign a deal to export $11 million worth of his state’s wheat to the island.

Asked the obvious question about whether longstanding American trade sanctions should be lifted, Governor Heineman ducked and weaved like a professional boxer. “Well, I try not to get into that, because that’s up to the president and the Congress, but I will say expanding trade relationships is good for Nebraska and altogether good for America,” he said.

Just weeks after President Bush delivered an address calling on the world to isolate Cuba, officials from Minnesota, Alabama and Ohio — and more than 100 American businesses — were working the giant Havana International Fair, trying to secure part of the $1.6 billion the Cuban government spends each year to import sugar, wheat, livestock, poultry and beans, among other staples.

Those business interests clash with the Bush administration’s anti-Castro policies, as well as the need of both Democrats and Republicans to court Cuban exiles in Florida, a crucial voting bloc. So while some trade with Cuba is allowed, it is fraught with restrictions. A 1992 law, for instance, denies ships access to American ports for six months after they have docked in Cuba, making shipping tricky, to say the least.

Several Americans here said they were frustrated that the sanctions have proved more a source of irritation for those who want to do business with Cuba than a crippling blow to Fidel Castro.

“They are doing everything they can to make it difficult,” said Ralph Kaehler, a Minnesota farmer who sells cattle feed in Cuba. “It’s unfortunate.”

American businesspeople and state officials have been coming to the fair for six years, ever since Congress gave in to pressure from the agriculture lobby in late 2000, during the waning days of the Clinton administration, and lifted a four-decade ban on selling food to Cuba.

Since then, the number of farm states and agribusinesses who want a piece of the Cuban market has been growing, despite the Bush administration’s steady tightening of sanctions. For farm states, the need for jobs has trumped cold-war politics.

“It’s helped our economy,” said Ron Sparks, the Alabama agriculture commissioner, as he talked with people near the booth for the Mobile Port Authority. “It’s helped our farmers. I don’t talk national policy.”

Now in its 25th year, the annual trade fair drew more than 1,000 companies from 53 countries to a sprawling fairground known as Expocuba just outside Havana.

The atmosphere was festive, with more than a dozen restaurants where people drank Havana Club rum and puffed on Cuba’s famous cigars, a treat several Americans appeared to enjoy. The five-day fair, which ended Saturday, also attracted hundreds of ordinary Cubans.

Aside from state officials, the American delegation included several shipping companies and large agricultural outfits like Pilgrim’s Pride, Cargill and Purdue. Their sales representatives worked in the booths all day before returning to the Hotel Nacional, an art deco landmark, and then heading out to enjoy the Havana night life.

Some Americans at the fair predicted that Cuba’s market would open up more after Fidel Castro gave up power permanently, and they said they wanted to get a head start on deal making. Many envision a return to the prerevolution days when the United States was Cuba’s biggest trading partner, as wheat and durable goods flowed south while sugar, tobacco and rum flowed north.

But financial and travel restrictions have never been tighter, as the Bush administration has quietly stepped up the prohibition of tourism to and from Cuba and invented new ways to squeeze the island financially. It has also increased efforts to fine international banks that handle transactions in dollars for the Cuban government as well as companies that do business in both Cuba and the United States.

American farmers complain that Washington has also tried to find ways to hinder agricultural sales to the island. Since the ban was lifted in 2000, an exception to the general trade embargo against Cuba, sales from American farmers to the island have risen to about $500 million a year, Cuban officials say.

But the Bush administration has required the purchases to be made in cash and, since 2004, that the payment must be received before shipment. The system has created immense logistical headaches for American shippers and food exporters. Loads of grain and poultry end up waiting for days on a dock until proof of payment arrives, shippers said.

“There are lot of delays in loading because of that,” said Eric T. Junker, the owner of Americana Marine Services, which ships grain to the island.

President Bush and other supporters of the sanctions maintain that every dollar that enters Cuba helps support a despotic regime. In his speech on Oct. 24, Mr. Bush asked Congress to maintain the embargo and said the transfer of power from Fidel Castro, who has been ill, to his brother Raúl, amounted to “exchanging one dictator for another.” He called for elections after Fidel Castro’s death.

Cuban officials argue the embargo hurts American farmers more than it does the government here. But they also acknowledge the American attempts to punish foreign companies for doing business here have hurt them in dozens of small ways, from limiting their ability to buy to certain medicines to making it impossible to get spare parts for scientific equipment.

“The blockade makes doing business here insecure,” said Pedro Álvarez Borrego, the chairman of Alimport, the government-owned company that imports food.

The biggest blow, however, has been to tourism. The minister for tourism, Manuel Madero, said that before Mr. Bush took office, about 80,000 Americans visited Cuba every year, usually going through Mexico or another country. He declined to give a number for the current year, but said it had been reduced to trickle.

Luis M. Morejón, who operates a small tour company, said he used to arrange tours for at least 30 Americans a year in the late 1990s. “Now this whole year I haven’t had one,” he said.

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