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HavanaJournal.com: Cuba Business

Rule change seeks to halt US agriculture sales to Cuba

Posted February 24, 2005 by publisher in Cuba Business.
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By Rafael Lorente Tribune Newspapers: South Florida Sun-Sentinel

The Bush administration announced Tuesday that it will begin requiring Cuba to pay American farmers in advance of shipment for agricultural products, a change that trade proponents say will hurt lucrative food sales to the island.
One farm-state senator threatened to block Treasury Department nominees to protest the rules, which some in Congress are trying to void.

The Treasury Department’s Office of Foreign Assets Control, which enforces trade and travel restrictions with Cuba, issued the regulations Tuesday in the Federal Register. They will take effect after 30 days.

The Treasury Department had been considering issuing what it calls clarification of the rules since November. Cuba has been able to make cash-only purchases of food from the U.S. since late 2000.

Until last year, Cuba had paid for agricultural shipments in transit or after they arrived at a Cuban port, but before formal title for the goods exchanged hands. In 2004, Cuba purchased $392 million worth of farm products.

Officials with Cuba’s food importing agency could not be reached for comment Tuesday.

The administration’s move likely will intensify a battle with farm-state lawmakers of both parties. Sen. Max Baucus (news, bio, voting record) (D-Mont.) said in a statement Tuesday that in retaliation he will block “significant” Treasury Department nominees.

“When I first heard of the proposed change, I threatened to block consideration of significant Treasury nominees,” Baucus said. “Now that the change is made, I promise to be good to my word. I owe it to my Montana agricultural producers: This change means $15 million directly out of their pockets. I will do everything I can to keep that from happening.”

Baucus recently joined with Republican Sens. Larry Craig of Idaho, Pat Roberts of Kansas and Richard Lugar of Indiana and others to introduce legislation that would define cash in advance as payment upon transfer of title, the accepted practice until late last year.

If the bill passes both the House and Senate, it still would have to get through negotiations between the two chambers before reaching the president. In the past those negotiations, known as conferences, have been used by allies of the White House to kill legislation that makes trade with or travel to Cuba easier.

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