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HavanaJournal.com: Cuba Business

Sysco changes its mind on dealing with Cuba

Posted August 25, 2004 by publisher in Cuba Business.
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By DAVID KAPLAN | Houston Chronicle

The Houston-based Sysco Corp., the nation’s largest food distributor, has scrapped plans to do more business with Cuba.

On Aug. 11, a Sysco subsidiary in Alabama signed a letter of intent to increase food sales to the island, but that letter has since been retracted because it contained language conflicting with corporate policy, Toni Spiegelmyer, a company spokeswoman, said Monday.

The letter included a statement that both parties would work to normalize trade relations between Cuba and the United States. Sysco subsidiaries are not authorized to make political or government policy statements, Spiegelmyer said.

The United States has generally prohibited trade with Cuba for decades, but a four-year-old law makes it legal to sell American farm products to the communist nation.

David Dickson, president and CEO of Sysco Food Services of Central Alabama, signed the letter of intent but retracted it less than a week later.

Since last fall, the Alabama subsidiary had generated $500,000 in sales with Cuba.

‘‘At this time, we don’t have plans to do business with Cuba,’’ Spiegelmyer said, “but we will fulfill any obligations, if there are any.’‘

Dickson was not available for comment Monday.

BRISK BUSINESS

About 115 U.S. companies have done business with Cuba since 2001, said Kirby Jones, president of the Washington-based Alamar Associates, consultants for American companies seeking business with Cuba. He said that he did not know how many have signed letters of intent that include trade policy statements with Cuba but that some have had such policy statements removed.

Letters of intent are not legally binding, said Jones, who acknowledged that U.S.-Cuba relations are still a very political issue.

‘‘He didn’t realize what he was signing,’’ Ken Spitler, Sysco’s executive vice president of food-service operations, said regarding the letter signed by Dickson. “He was in the business of making a sale. It’s one of those situations you get into when you’re an aggressive company.’‘

STAYING FOCUSED

Sysco will continue to keep its business focus on the U.S. and Canada, Spitler said.

Before the retraction, Spiegelmyer said, Sysco planned to do more business in Cuba’s tourism industry, namely hotels and restaurants, and to sell dietary supplements to hospitals and schools.

Last year, American companies generated $248 million in food-related sales to Cuba, according to Parr Rosson, professor and extension economist at Texas A&M University. In just the first half of 2004, they’ve done almost as much—$243 million.

In July, Sysco acquired the Florida-based International Food Group, a distributor of food to chain restaurants in the Caribbean, Central America, South America and the Middle East. IFG does not do business with Cuba, Spiegelmyer noted.

Member Comments

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On August 29, 2004, Ralph wrote:

They are very anxious to make business with Cuba,which is legal
because,even in that absurd and ludricous bill which reinforce
the restrictions over business with Cuba,the foods and health
drugs are allowed and the want because of the payment,which is
cash-down.It seems to me ridiculous,cut normal trade with a
country on ideological grounds.This year maybe not,but next
year they could want to go in business,it just they are under
pressure.If I am wrong,escape from me why?.for example,nothing
but The Global Fund for Hiv aids,Malaria and Tuberculosis,of
the United Nations,decided to cut the assistant on Zimbabwe
in this matter on political ground,I can accept that Mugabe
is not good,but to condemn those people in need(Zimbabwe has
  4-5 out 10 people among 19-49 years infected with HIV-Aids),
to not receive antiretroviral therapies,is shameful and——
outrageous.ther is no reason or whatsoever to do so and just
1 month ago in Thiland the International Conference about HIV
declares Open access,too much words and few facts.I think
embargoes,restriction in trade,it is not the way to help go-
vernment to rectify positions or whatever.