The full scale U.S. embargo of Cuba has ended. With no fanfare or “fall of the Berlin Wall” celebration, a mighty flow of American goods is streaming into Cuban stores and kitchens.
In 2000, Cuba ranked dead last among all 180 nations in terms of agricultural purchases from the United States according to U.S. government figures. In 2001, Cuba’s ranking rose to 138. This year Cuba is poised to finish at 45th. Next year, Cuba will likely buy $260 million in agricultural goods and be 33rd on the list. Not bad considering the two countries haven’t had diplomatic relations for over 40 years.
In September, over 150 U.S. companies, organizations and state offices will participate in a huge U.S. Food and Agriculture Exhibition in Havana. The event, authorized by the U.S. Treasury Department, will feature over 1000 brand name, American products including cheese, ice cream, beer, pet foods, cotton, tobacco, lumber, vitamins, and many others. For the first time in 43 years American buffalo, beef cattle, dairy cows, hogs, and chickens will be shipped to Cuba as part of the show.
As recently as last May, President Bush vowed not to ease the trade ban on Cuba. He said, “Well-intentioned ideas about trade will merely prop up this dictator, enrich his cronies and enhance the totalitarian regime.”
Yet Cuba is buying more food from the United States than Denmark, Portugal, Greece, Hungary, Austria, and over 100 other countries. How is this possible? Do Congress and the White House know about this?
In 1961, President John Kennedy cut diplomatic relations with Cuba, imposed an embargo against trade with Cuba, and effectively banned most American travel to Cuba.
In October of 2000, the U.S. Congress passed—and President Clinton signed—the Trade Sanctions Reform and Export Enhancement Act (TSRA). The law said Cuba could begin buying U.S. food products for any purpose, but the Cuban government was irked by restrictions the legislation included. Specifically, TSRA requires that all purchases by Cuba must be made with cash…no financing is allowed. Cuba said thanks but no thanks, and U.S.-Cuban relations continued as they had in the past.
Then Cuba was hit hard by Hurricane Michelle in November of 2001. To recover, Cuba made what it said was a one-time exception to buy American corn under the TSRA rules. They bought 30,000 metric tons of corn from Archer Daniel Midlands.
That corn came from nine different U.S. states. And Cuba kept buying.
Since then they have bought peas, barley, soybeans, condiments, soup, pasta, carbonated beverages, onions, chicken, turkey, apples, eggs, and many other items. These purchases represent Cuban trade with 30 states.
Because of the TSRA rules, Cuba has been devoting much of its small cash reserves to U.S. trade. In fact, some suppliers in other countries are not being paid on time as Cuba uses its cash to build a financial constituency in the United States.
With 30 states involved, 60 U.S. senators and a majority of the U.S. House now have an economic incentive to keep this breach of the embargo open and perhaps expand it further. And the U.S. embargo of Cuba will end not with a breaking news bulletin on CNN but with a few statistical lines in a U.S. Department of Agriculture report.