Saturday, March 14, 2009

Cracks open in U.S. embargo of Cuba

St. Petersburg Times

By David Adams, Times Latin America Correspondent

In Print: Friday, March 13, 2009

For eight years, the Bush administration fought off all attempts to soften U.S. policy on Cuba.

That ended Wednesday when President Obama signed into law a vast $410 billion spending bill, which included several seemingly minor changes to Cuba policy that represent a small but significant crack in Washington's 46-year-old economic embargo against Cuba.

"Congress has shown it is willing to act and the Bush veto threat isn't there anymore," said Phil Peters, a Cuba policy expert at the Lexington Institute in Washington.

One of the bill's Cuba provisions repealed Bush's 2004 restrictions on travel to Cuba by Cuban-Americans with relatives on the island

But the change that might have the most impact is one that came as a surprise to many Cuba watchers.

American businesses selling agricultural and medical goods to Cuba will no longer need to seek a special license to travel from the Treasury Department.

"That actually changes the policy," said Peters. "It creates a new category of licensed travel to Cuba."

In what remains the lone exception to the embargo, U.S. agricultural and medical products may be sold in Cuba under a law passed in 2000. Since then, exports to Cuba have soared from almost zero to $718 million last year.

Some members of Congress, including Democratic Sen. Bill Nelson and Mel Martinez, his Republican colleague, raised concerns that the new license provision marked a dangerous loosening of the embargo that could be abused for tourism.

In a last minute-effort to secure votes from senators who had vowed to block the entire budget bill, Treasury Secretary Timothy Geithner assured the senators that the government would interpret the new law so strictly that it will be ineffective.

The Treasury Department would require an affidavit before travel, stating the purpose of the visit, documentation regarding meetings held in Cuba, as well as money spent, Geithner wrote. Living it up at Havana cabarets or beach hotels presumably would not be tolerated.

But Cuba trade experts say the assurances are a political charade. U.S. officials almost never check documentation on Cuba and have no way to check on their accuracy. U.S. officials can hardly ask the Cuban government to keep tabs on American businessmen in Cuba, they note.

Besides, American companies with legitimate business in Cuba have never had much trouble obtaining the special licenses to travel there.

"I haven't seen one turned down," said Kirby Jones, president of Alamar Associates, a Washington company that handles travel licenses.

"This is all about finding a way for the senators to save face," said Tim Ashby, a Miami lawyer with the Havana Group, a Cuba business consultancy. "They are feeling the heat on Cuba, and they know more change is coming."

Geithner made it clear that everything may soon be moot, noting that U.S.-Cuba policy is being reviewed by the Obama administration.

Much more radical legislation on Cuba, lifting travel restrictions for all Americans, is working its way through Congress.

That's when the real battle begins.

Contact David Adams at or (305) 361-6393.

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