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Posted July 05, 2004 by publisher in Cuba-World Trade

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Miami Herald

Question: A Jamaican resort company, SuperClubs, has reportedly been canceling some of its hotel management contracts with the Cuban government after being warned of sanctions by the U.S. government under the 1996 Helms-Burton Act for ‘‘trafficking’’ in expropriated property. Does the U.S. move signal a more aggressive approach to deterring foreign investment in Cuba? Will European firms also face sanctions?
Answer from Dan Erikson, director for Caribbean projects at the Inter-American Dialogue: Don’t the Jamaicans know better than to invest in Cuba during a U.S. presidential election year? The Jamaican company was unwittingly caught up in the wider movement by the Bush administration to tighten up some aspects of U.S.-Cuba policy in an effort to win the Cuban-American vote—and thus, Florida—in the 2004 elections. This incident marks the first time that the Bush White House has implemented the Helms-Burton measures that allow the U.S. to deny visas to foreign nationals for investing in disputed Cuban properties. But Jamaica is a minor player. A far more interesting question is whether the U.S. will lower the boom on Spanish companies invested in Cuba. If so, that will demonstrate that U.S. policy has really taken off the gloves.

From William Rogers, a senior partner at Arnold & Porter and a former assistant secretary of state for Inter-American affairs: The administration sent that signal to the voters in Florida in its 423-page May report, Assistance to a Free Cuba. In fact, the report wants to punish Cubans who are unfree. Its proposals will hurt the Cuban people more than the regime. For example, it includes another cutback in the pitiful parcels Cubans here can legally send to their relatives in Cuba. Whether the administration will also go after Europe is less clear. Threatening a Jamaican firm with Helms-Burton Title IV sanctions is one thing. Denying visas to European business leaders under Title IV would be quite another. Europe is bristling with anti-Helms-Burton laws, blocking compliance with the U.S. sanctions. And European governments might well react with a WTO complaint against the U.S.

From Dennis Hays, managing director of the Global and Government Affairs Practice at Tew Cardenas LLP: The Castro regime has for years sought to encourage foreign companies to invest in properties that were confiscated without compensation in the early years of the revolution. Such expropriations were and are illegal under international law, and companies that knowingly chose to invest in them effectively become co-conspirators with the regime. This is significant, among other reasons, because such investments will greatly complicate the task of reestablishing property rights in a post-Castro Cuba—a key component for economic recovery. By acting now to enforce Title IV of the Helms-Burton Act, the Bush administration is upholding international law and working to facilitate the inevitable reform process that will occur under a democratic government.

From Terry McCoy, director of the Latin America Business Environment Program at the University of Florida: There is no question that the Bush administration has escalated efforts to unseat Fidel Castro. The effects of these apparently election-year-motivated moves remain to be seen, however. The Jamaican resort company did pull back when threatened with Helms-Burton sanctions, but European and Canadian firms may not. Further, there is growing opposition in Florida’s Cuban-American community to restricting visits and remittances.

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