Tuesday, August 24, 2010

OFAC Goes After Barclays

Barclays fined $298m for sanction breaking

Barclays faces penalty from US authorities for handling covert financial transactions involving banks in Cuba, Iran and Libya

* Andrew Clark
* guardian.co.uk, Monday 16 August 2010 20.27 BST

Barclays is to pay $298m (£190m) in fines to the US authorities for "knowingly and willfully" violating international sanctions by handling hundreds of millions of dollars in clandestine transactions with banks in Cuba, Iran, Libya, Sudan and Burma.

The British bank yesterday agreed to pay financial penalties to settle two criminal charges laid by the US department of justice, which accused Barclays of violating a "trading with the enemy" act which prohibits business with certain countries viewed as threats to national security.

Documents filed at a federal court in Washington accused Barclays of handling money transfers totalling $500m from banks in prohibited countries through its dollar clearance branch in New York between 1995 and 2006. Barclays is not alone in facing such charges: Lloyds TSB and Credit Suisse both settled with the US government last year over similar dealings with institutions in repressive regimes.

"For more than a decade, Barclays knowingly and willfully engaged in practices outside the US that caused its New York branch and other financial institutions located in the US to process payments in violation of US sanctions," says an affidavit filed by the US government, which described Barclays as a London-based institution employing 144,000 people in 50 countries with 48m customers.

Under a deferred prosecution agreement signed by Barclays' general counsel, Mark Harding, the bank has agreed to a string of measures to improve training and tighten internal procedures, and to co-operate with any further investigation by the US authorities. The bank is paying $149m to the US department of justice and a further $149m to the office of New York's district attorney.

The deal went before a Washington judge for approval yesterday. But judge Emmet Sullivan adjourned the hearing, saying he wanted Harding to appear in person: "He's the one who signed the pleadings and he should be here."

The episode is an embarrassing blot for Barclays, which has been working hard to build its presence in the US with a view to becoming a top-tier Wall Street player. Barclays bolstered its presence in investment banking two years ago by buying much of the US operation of bankrupt Lehman Brothers in a deal worth $1.75bn.

Court documents reveal that Barclays co-operated proactively with the US authorities, initially approaching the US treasury's office of foreign assets control in May 2006 to own up to four sanctions-busting transactions.

A Barclays spokesman confirmed that the bank was "in the process of seeking court approval" for a settlement with prosecutors but added: "Because this matter is pending before the court, at this time we will have no further comment."

The US government has vowed to come down hard on sanctions-busting. Cuba has been barred from business with the US since President Kennedy's tenure in the White House in the early 1960s. Sanctions have been in place against Iran since 1995 and were imposed on Sudan and Burma in 1997. Libya was on a list of "state sponsors of terrorism" until 2006, although relations have since thawed.

Prosecutors contend that foreign banks with a presence in the US have colluded in giving institutions in these repressive regimes a back-door route into the American financial system. Lloyds TSB agreed to pay $350m in January 2009 for its dealings with Libya, Sudan and Iran, while Switzerland's second biggest bank, Credit Suisse, struck a deal in December paying $536m for violating sanctions against Iran.



The blockade against Cuba and the banks
Cuba is not the object of any "international sanctions" (Barclays faces $298m fine for breaking sanctions, 17 August). It has been the target for 50 long years of a unilateral US government policy of economic, commercial and financial blockade – as your article illustrates – but one that the international community has overwhelmingly condemned for 18 consecutive years at the UN general assembly. In the successive resolutions on the issue passed over those years, the UN has called on the US to lift this illegal and inhumane measure, which is found to be in violation of basic principles of international law, the UN charter and the freedom of trade and navigation. This year the UN general assembly will no doubt ratify this position for the 19th time. One can only hope that the US government will listen to that worldwide clamour and abandon such an unhelpful policy in favour of a constructive one.
René J Mujica Cantelar
Ambassador of Cuba to the UK

•  I never thought I'd rush to the defence of our reviled banks. But news that the US is still enforcing its discredited policy of sanctions on Cuba and that Barclays has been fined by the US justice department for facilitating trade with, among other countries, Cuba appals me. Recently the US has been relaxing the moratorium on Cuba and we have seen a welcome liberalisation there with the release of political prisoners and a lifting of the heavy hand of the state on private enterprise. Therefore I am shocked that Barclays should be penalised in this manner.

Benedict Birnberg


Monday, August 16, 2010

Gov. Bill Richardson Washington Post Op Ed

Time for Western Hemisphere countries to collaborate

By Bill Richardson
Saturday, August 14, 2010; A13

Arizona's attempt to create and enforce its own immigration policy has once again amplified -- and politicized -- the immigration debate in this country. But the fallout of that debate extends beyond our borders. The anti-

immigrant push in Arizona has further alienated our neighbors throughout Latin America, who had been hoping for better relations with the United States after President Obama's election. We need to turn this opportunity to our advantage and engage with our neighbors throughout the Western Hemisphere.

Latin America has perhaps the greatest impact, in terms of trade and culture, on the daily lives of most Americans. U.S. exports to Latin America have grown faster in the past 11 years than to any other region, including Asia. Hispanics represent the biggest ethnic and most sought-after voting bloc in the United States. And nearly every country in North America, Central America, South America and the Caribbean now has a democratically elected government.

The time is right to leverage our trade and partnerships and advance a more collaborative relationship with our neighbors to the south. The Obama administration should consider these five steps:

-- First, it should aggressively lobby Congress for a comprehensive immigration law. Such legislation would include increased border security; a crackdown on illegal hires; and an accountable path to legalization that requires the 11 million immigrants here illegally to learn English, pass a background check, pay fines and get in line behind those who are trying to enter our country legally. Illegal immigrants come to our country from Central and South America and the Caribbean. This is not just an issue with Mexico; it is a hemispheric issue that needs a comprehensive response.

-- Second, as a first step to changing our policy toward Cuba, the president should issue an executive order to lift as much of the travel ban as possible. The travel ban penalizes U.S. businesses, lowers our credibility in Latin America and fuels anti-U.S. propaganda. Lifting the ban would also be a reciprocal gesture for Cuba's recent agreement, negotiated among the Catholic Church, the Spanish government and President Ra?l Castro, to release political dissidents. Obama has taken significant steps to loosen restrictions on family travel, remove limits for remittance and expand cooperation in other areas such as expanding the export of humanitarian goods from the United States into Cuba. Loosening travel restrictions is in U.S. interests and would be a bold move toward normalization of relations with Cuba.

-- Third, embark on a new Alliance for Progress with Latin America and the Caribbean, modeled on President John F. Kennedy's vision for the hemisphere. This should not be a one-sided alliance preconceived on expansion of U.S. markets, nor an agreement that imposes a U.S. solution. We need a new partnership in which we close the gap between the haves and have-nots by addressing both human and economic needs and giving more priority to the indigenous people of this hemisphere.

The United States needs to craft a hemispheric agenda that includes and emphasizes solutions to energy demands and climate change in Latin America and the Caribbean. Perhaps we need a hemispheric agreement on renewable energy that provides the technical know-how for the Americas and dramatically expands the biofuel agreement with Brazil. We also need to move quickly toward a real carbon-trading system that would reward countries that protect their forests.

-- Fourth, we should continue to seek trade agreements that are free and fair and contain strong standards on labor, the environment and human rights. Pending trade agreements with Colombia and Panama should be approved by Congress and once again establish the United States as a reliable trading partner. Additionally, the Obama administration should seek a hemispheric agreement on common labor, environmental and human rights standards. This bold move would promote our interests and image in the region.

-- Finally, we need a hemispheric accord on crime and violence. In New Mexico, we are working with law enforcement at the local, state and federal levels and on both sides of our border with Mexico to share intelligence and stop the illicit trade of narcotics, illegal guns and human trafficking. These are transnational issues that involve a coordinated effort to protect the safety of law-abiding citizens of the United States and Mexico. We must not allow the immigration debate to distract from our national responsibility to engage with our neighbors in Latin America and the Caribbean. Better hemispheric relations should be a foreign policy priority, not an afterthought.

The writer, a Democrat, is governor of New Mexico. He is former U.S. ambassador to the United Nations and former energy secretary.


Tuesday, July 27, 2010

OFAC Nails UN Bank For Dealing With Cuban Diplomats to the UN

Export Law Blog (blog) - July 19

By Clif Burns

The latest monthly release of civil penalty information by the Office of Foreign Assets Control (“OFAC”) describes a penalty “settlement’ with the United Nations Federal Credit Union, which agreed to pay $500,000 to settle charges that the UNFCU “dealt in property in which Cuba or a Cuban national had an interest’ as they quaintly say it in OFAC-speak. In ordinary English this means that UNFCU engaged in banking transactions with Cubans, likely with Cuban diplomats to the United Nations.

Of course, we have to say the transactions were likely with Cuban diplomats because, given OFAC’s longstanding aversion to providing anything but the most minimal details about its penalty settlements, the notice leaves out such crucial details as whether the Cubans involved were diplomats, non-diplomatic Cuban officials, ordinary Cubans, or herds of Cuban cattle. Nor were the types of transactions involved mentioned or their amounts.

In this case, the absence of details makes OFAC look foolish by suggesting the possibility that OFAC is penalizing the UNFCU for providing banking services to Cuban diplomats posted to the U.N. Apparently, such diplomats need to travel with suitcases of Cuban pesos and pay for their meals in the U.N. cafeteria with their national currency.

If that’s what OFAC is doing, it would be in direct contravention of the U.N. Headquarters Agreement, particularly given that the UNFCU is located in the U.N. Headquarters area. Article V, Section 15(4) of that agreement provides that even with respect to diplomats from countries not recognized by the United States, such as Cuba, the U.S. must accord them the same privileges and immunities as other diplomats while within the headquarters district. If a diplomat from France can bank at the UNFCU located in the U.N. Headquarters district, so can Cuban diplomats, no matter how much OFAC hates Castro and his diplomatic lackeys.

The UNFCU website has this statement (click on “Account Restrictions”) about its ability to deal with Cuban diplomats:

Please be aware that UNFCU, under authorization from the US Treasury Department, is only permitted to operate accounts for actively employed UN staff stationed in Cuba, Iran, Burma, and for Cuban citizens who are stationed in the United States.

Based on this, perhaps what was going on and again OFAC forces us to speculate was that the UNFCU was providing banking services to Cubans at U.N. locations outside the United States. The UNFCU website’s branch listing shows that the UNFCU has branches in Geneva, Vienna, Rome and Nairobi. Of course, the UNFCU’s extra-territorial application of U.S. sanctions could create a new problem for itself because these sanctions could well violate local laws that prohibit discrimination based on national origin.

Additionally, and more significantly, the UN could always solve the problem by only providing office space to financial institutions that do not, like UNFCU, discriminate against UN members based on national origin.

Friday, July 2, 2010

Who is a spy and why?

La Alborada - July 2

The FBI has charged eleven people with conspiracy to act as agents of a foreign government --Russia-- without notifying the Attorney General. That's not "spying" or "being an unregistered foreign agent," but conspiracy to act as an agent. The Associated Press interpreted the news this way: "Russian agents infiltrated US society, charges say": infiltrated not the government or the Pentagon, but society. Nothing that we have found in the news so far suggests that the accused gathered any information of significance. The indictment charges that the defendants were paid or expected to be paid by Russia for their work.

The eleven defendants were arrested and jailed. Proceedings in the matter will determine whether or not they are guilty of any of the charges brought. If they are found guilty, they will surely serve time in prison.

They will never be called "dissidents," the generic name given to a number of people in Cuba who include agents of the US government. Many of them have been jailed since 2003. The evidence against the latter, obtained in part from Cuban security agents who had been posing as collaborators and also, as was the case here, by surveillance, was summarized in a book, Los Disidentes, published soon afterwards in Cuba.

The evidence showed that the dissidents were coordinated, directed, and financed by the US Interests Section in Havana, and also from Madrid. The declared independent journalists turned out to be independent from the Cuban government, but not from the US. They were told what kind of information they should generate; on their compliance depended the support, including payment in money and kind, that they received from the Interests Section, at which they often met to coordinate their activities.

The financing of dissidents --or subversives, depending on point of view-- in Cuba by the US is no secret. Congress periodically appropriates money in the millions of dollars officially earmarked to support the dissidents. When it is the US that does this, it considers it proper and necessary, a matter of course. It sees no need to make such payments a covert operation; in fact, it announces the payments proudly. The US also helps to arrange favorable media coverage for the dissidents.

The mass media never, ever, mention the evidence of control of and payment to the dissidents arrested in 2003. It, too, considers it normal that the US should sponsor them, or pretends that there is no connection, although charges of such an arrangement have become a major factor in reporting on the alleged Russian agents.

Russia is not attempting to overthrow the US government, nor could it do so; certainly not by using the kind of information that is at issue in the current case. The US no doubt has its own agents and spies in Russia, but it is not seeking to overthrow the Russian government. The US, however, is committed by law to overthrow the Cuban government, which is the ultimate goal of the blockade. Alan Gross was in Cuba surreptitiously under a grant dedicated to such a purpose. In 2003, in fact, the Bush administration served notice to states that it did not like that they could experience the same shock and awe to which Iraq was subjected.

SInce 1959, the US has sponsored and/or sheltered a variety of terrorists, such as Luis Posada Carriles, whose goal is to overthrow the government of Cuba by force. It was because of this that Cuba sent agents to Florida to gather information on what these elements were planning. That information did not remain secret, however; Cuba turned it over to the FBI. As a result, the FBI arrested the Cuban Five, who are now serving up to two consecutive life sentences.

Whatever one thinks of the Cuban government, it should not be hard to see why the Cubans would be upset at the financing and directing of US agents on the island, to the point of imprisoning them, especially considering US policy and the circumstances of 2003.

What justifies the difference in approach to the case of those charged as Russian agents and the case of the US agents in Cuba? Essentially, it comes down to two things: 1) Because we are Good and they are Bad; and 2) Because we can do it.

The policy --and law-- as to Cuba remains in effect. There is nothing to suggest that, if the Cubans did not react to the funding and direction of dissidents on the island, the US would cease to sponsor agents there. On the contrary, there would likely be more such agents in Cuba.

The US has Cuban agents in jail, and Cuba has US agents in jail. If there is the will to improve relations between the two governments, one place to start would be to exchange them.

Washington, DC
Cuban American Alliance Education Fund

Thursday, May 27, 2010

American Businesses Hoping to Cash In On Cuba

| 26 May 2010 | 01:03 PM ET

American industries of all kinds—from travel and telecom to construction and energy—would be poised to profit if the 52-year trade embargo with Cuba were lifted. Among the first businesses to cash in would be those involved with tourism, most experts agree.

“I believe U.S. travel and tourism companies will be the first to benefit,” said Larry Register, president of the Cuba Business Bureau consulting firm.

“The travel sector already is getting prepared for what might happen,” said Kirby Jones, president of the U.S.-Cuba Trade Association.

In fact, the U.S. travel industry already has seen a significant growth in Cuban tourism, even with the embargo still in place.

President Obama, who has called for “a new era” in relations with the island country, lifted nearly all restrictions on Cuban Americans' travel there in April, 2009. This year, more than 20,000 Cuban-Americans travel to their homeland each month, compared to 9,000 before the restrictions were lifted. The Bush Administration had allowed only one visit per person every three years.

Last week, the U.S. agency that enforces Cuba sanctions approved 42 new travel and other service providers, allowing them to do business with Cuba. There were no such approvals last year.

If travel restrictions to Cuba were lifted for all Americans, first-year projections suggest that 800,000 to 1 million Americans would visit, said Jones, whose Alamar Associates consulting firm staged a U.S.-Cuba tourism summit in Cancun earlier this year.

“There were 120 people there,” Jones said. “All major travel-sector tour operators came to meet with Cuban officials to discuss the potential of doing business and how it might be done.”

Cuba began developing its tourism industry after the 1989 collapse of the Soviet Union, which had granted Cuba billions of dollars in annual subsidies. Last year, more than 2.5 million tourists visited Cuba, mostly from Europe and Canada. Tourism is now Cuba’s biggest source of foreign income.

Jones, who has advised U.S. companies on Cuba since 1974, is not optimistic about an outright end to the Cuban trade embargo. But he thinks a piece of legislation moving through Congress may serve much the same purpose.

House Agriculture Committee Chairman Collin Peterson, D-Minn., is sponsor of a bill that would eliminate some of the cumbersome restrictions faced by farmers who have been selling food to Cuba since 2001.

The Trade Sanctions Reform and Export Enhancement Act of 2000 lifted part of the trade embargo, allowing the sale of food and medical supplies to Cuba’s 11 million people. Since then, a steady flow of U.S. corn, cattle, wheat, rice, apples, cereal and soybeans has made its way to Cuba, which must import 70 percent of its food.

But the reform bill mandated that Cuba had to pay cash upfront for all transactions—allowing no credit. It further stipulated that both parties to any transaction had to use a bank in a third country, disallowing any direct dealings between U.S. and Cuban financial institutions.

Even with those restrictions, U.S. exports to Cuba reached $710 million in 2008, before the global recession forced the cash-poor island to cut back 26 percent last year to $528 million.

Peterson’s bill would do two things. First, it would allow direct transactions between U.S. and Cuban banks. Farmers have long been complaining that the forced use of another foreign bank adds needless cost and prevents expansion of their business.

The second part of the bill is more controversial. It would lift the travel ban for all U.S. citizens, so the resulting increase in tourism would help Cubans generate the cash they need to buy more U.S. goods.

“They’re within 10 votes of getting this passed in the House,” Jones said. “I’ve been following this issue for 35 years and I’ve never seen anything like this. They’re not quite there yet, but it’s closer than it’s ever been.”

A lifting of travel restrictions would sound the death knell for the embargo, Jones believes.

“Right now, most U.S. companies cannot buy or sell goods with Cuba,” he said. “But the validity of having a trade embargo when a million Americans are going there every year loses all sense of logic. I can imagine the head of John Deere thinking to himself,. ‘I can’t sell tractors down there, but my son can go for spring break?’ The embargo would begin to be dismantled.”

Jones envisions an American tourism influx that would lead to ATMs, U.S. cellphone coverage, and airplane maintenance facilities.

“There are any number of areas that will be opened up if there is free and open travel to Cuba,” he said.

Travel and tourism may top the list of business sectors that would benefit from a lifting of the Cuban trade embargo, but they’re followed closely by mining, oil, telecommunications, construction supplies—and virtually everything else.

“Who wouldn’t want to do business in Cuba? They need everything.” said George Harper, an attorney whose Miami firm often deals with Cuban trade ssues.

“You name it—construction, road building, services of all kinds, banking insurance,” added Harper, who was born and raised in Cuba. “It’s an absolute gold mine for any company that wants to expand.”

Beyond travel, the two biggest sectors with potenital for doing business in Cuba are mining and energy, experts say.

Cuba’s nickel deposits are the third-largest in the world and represent its second most valuable export behind sugar. There are no nickel deposits in the United States, which imports imports all of its nickel, mostly from Canada and Australia. It’s is used widely as an alloy, much of it in the production of stainless steel products.

Copper, chromium, and cobalt also are mined in Cuba, with lesser quantities of salt, lead, zinc, gold, silver. Immense iron reserves have not yet translated into much production.

In 2004, the U.S. Geological Survey estimated that drilling off the coast of Cuba could yield 5 billion barrels of oil or more. The Brookings Institute has said that Cuban oil reserves are "equal to major fields in Alaska people want to drill."

Senators Lisa Murkowski, (R)-Alaska, and Mary Landrieu, (D)-La., drafted legislation last year that would lift the trade embargo enough for U.S. oil executives to do business in Cuba, but the bill has languished. In the meantime, a multitude of other countries have moved in.

“Cuba has entered into quite a few partnerships to aggressively explore their coast,” said Jones, of the U.S.-Cuba Trade Association. “Canada, the UK, Spain, Norway, Brazil, Russia, Malaysia, Vietnam, Venezuela – all are partnering with Cuba to get at its oil.”

The United States still has a huge advantage over other countries because of its proximity to Cuba, even if it’s late to the game. Transportation costs over 90 miles of water would be miniscule when compared to Asia or Russia.

"We feel that a greater reliance on American technology to develop their resources could have a positive influence on the Cuban culture," said Robert Dillon, spokesman for Murkowski. "American companies are the best equipped and experienced to deal with offshore drilling like this, and we feel that American oil workers are missing out."

U.S. infrastructure companies stand to gain if the trade embargo is ended or loosened, said Register of the Cuba Business Bureau. “There is need for building supplies, highway development and building renovations.”

Another area worth exploring “right now” involves U.S. telecommunication firms,” Register added.

When it eased travel restrictions, The White House also announced it would exempt U.S. telecommunications companies from the trade embargo. Companies like Verizon , Sprint and AT&T could bring better phone and internet service to the island to “promote the freer flow of information,” a White House statement said.

But the Cuban government rejected such an arrangement. An executive of the government-owned telecommunications company, ETECSA, said two obstacles would first need to be removed. The U.S. froze $160 million in ETECSA funds in 1996, and they want it back. And the agreement that forces Cuba to pay U.S. companies through third countries—the same obstacle the Peterson bill would address—would need to be rescinded.

“It may seem like the Obama administration has expanded communication possibilities,” said ETECSA exec Vivian Iglesias. “But we know that unless restrictions like the (Cuban Democracy Act) and others that have been tightened since 1992 don’t change, there can’t be any normal communication.”

“The causes that led to the theft of our funds are still in place,” she said. “If those restrictions don’t change, that prevents direct communication between the United States and Cuba.”

In October 2009, a small Miami company, TeleCuba Communications Inc., announced it had obtained U.S. permission to lay fiber-optic cable to the island, but the Miami company admitted it has not yet received permission from Cuba.

While U.S. efforts are stalled, an Italian joint venture that began 12 years ago has developed a widespread cellphone system. Italy now owns 27 percent of ETECSA. Venezuela is spending $63 million to build an undersea fiber-optic cable across the Caribbean that is expected to be completed next year.

Business opportunities may abound in Cuba, but many impediments remain before U.S. firms can take advantage.

“I don’t think the embargo will be lifted in my lifetime,” said Cuban-born Harper, the Miami attorney. “But I’m 67. Maybe in my children’s lifetimes.

“I think the Castro boys will find a way to keep it in place,” he continued. “The embargo has been a good friend of theirs. There are few other things they can rally the Cuban people behind. It would be very difficult to keep control over people if there’s a free flow of information.”


Oil for U.S. and Cuba's troubled waters

By Ken Stier, contributor

May 26, 2010: 10:45 AM ET

(Fortune) -- Among the many good reasons to jettison our failed economic embargo against Cuba is one with timely new resonance: oil.

Cuba has plenty of it -- offshore in its exclusive economic zone (EEZ) -- and exploration is about to being in earnest with American companies stuck on the sidelines.

The U.S. Geological Survey estimates the nation has about 4.6 billion barrels and nearly 10 trillion cubic feet of natural gas in the North Cuba Basin, and possibly four times that much in its portion of the Gulf of Mexico. The lower estimate would put Cuba on a par with Ecuador or Colombia.

But monetizing these resources is a real challenge: The 48-year old U.S. embargo and Washington's diplomatic muscle have thwarted any real progress so far. But this edifice is under siege. The Spanish, through their energy giant, Repsol, are bringing a deep-water oil drilling rig to Cuba this fall.

Trade sanctions dictate that the rigs can not contain more than 10% of U.S.-made components, which can include software. Most rigs worldwide typically top that. To get around the restrictions, Repsol contracted for a Chinese, purpose-built rig from Saipem, the offshore drilling unit of Italy's Eni, SpA, which will operate the rig. When Repsol first drilled off Cuba's shore in 2004, its core samples were promising enough to bring on partners for this go-round, including Norway's Statoil and India's national oil company. Repsol did not reply to repeated requests for comment.

After Repsol starts drilling, other international oil companies with concession acreage off Cuba are expected to hire the Saipem rig, explains Jorge Pinon, a Cuban energy expert, with 32 years industry experience, including a stint as president of Amoco Oil Latin America before retiring in 2003 from BP, which had taken over Amoco.

"That rig is going to hang around in Cuban waters for quite a while," says Pinon, now a Florida International University fellow. "And if any of these drilling jobs hit pay dirt and substantial reservoirs are found, then the pressure in Washington is going to be such that you will see the embargo, as far as the oil industry is concerned, falling apart."

Fears of another spill

More worrisome to some is a petroleum stampede in Cuba with American companies -- and their environmental standards -- on the sidelines

"The sobering fact that a Cuban spill could foul hundreds of miles of American coastline and do profound harm to important marine habitats demands cooperative and proactive planning by Washington and Havana to minimize or avoid such a calamity," argues a recent Brookings Institution briefing paper.

Cuba's EEZ stretches to less than 50 miles from Key West but the embargo prohibits the U.S. from offering any assistance at all; by contrast there are agreements in place with Canada and Mexico to facilitate U.S. aid.

Both Statoil and Saipem have extensive deepwater experience, but other operators in the 59 Cuban concession areas -- held by the Chinese, Vietnamese, Malaysians, Venezuelans, among others -- don't or have less stellar environmental records.

Fears of a spill like that at the BP-contracted Deepwater Horizon rig might be an argument for the U.S. to try to head off Cuban exploration, but that seems an increasingly untenable tack, especially because Havana has been offering U.S. companies part of the action for years.
0:00 /2:42Cheap oil: Careful what you wish for

A history of failed efforts

Politics have derailed earlier overtures: During a 2006 summit in Mexico between Cuban officials and U.S. oil executives, the U.S. Treasury insisted the Cubans be booted from the U.S.-owned hotel where they were staying. But industry is again quietly lobbying, and Washington seems to be listening. After trying for a year to get a license to visit Cuba, the Houston-based International Association of Drilling Contractors was recently granted one to go to Havana, which was first reported by Cuba Standard, the leading independent site for business news on Cuba.

"It's inevitable that Cuba will explore and exploit their offshore hydrocarbon resources, and it would benefit both the American public and the Cuban people to make sure it is done right," argued a recent IADC position paper circulating in Washington.

Even more potent is the lobbying heft of the Petroleum Equipment Suppliers Associations, whose members include Halliburton (HAL, Fortune 500), Fluor (FLR, Fortune 500) and Bechtel. Industry sources credit PESA for a provision in a pending energy bill that would permit extensive industry contacts with Cuba.

A member company executive confirmed the industry sees "great opportunity" in Cuba while expressing concern that the time it takes to work out suitable conditions -- tax protocols, IP and contract sanctity protection -- could leave American companies trailing their international rivals.

Lifting or relaxing the embargo is just one step the Obama administration needs to take toward opening two-way trade with Cuba. The only real exception to the embargo -- for U.S. agricultural sales approved after 2001's devastating Hurricane Michelle -- is stymied because credit-starved Cuba has to pay cash up front. Removing that restriction could double sales to roughly $1.5 billion a year.

That is part of the "tremendous authority" the president has to advance bilateral relations, argues Jake Colvin, vice president for global trade issues at the National Foreign Trade Council, which opposes the embargo.

The Council recently joined eight other leading business organizations to support the pending Freedom to Travel to Cuba Act, to better position American businesses for the eventual lifting of the embargo. Seeing Exxon Mobil (XOM, Fortune 500) invest in Cuba probably requires "fundamental change" in bilateral relations, Colvin adds.

Not everyone wants the embargo to go

That the White House, and a Democratic Congress, haven't done more to jump-start that process has frustrated some supporters who note the sway that Cuban exiles have with Washington.

Albert Fox, Jr., founder of the Alliance for Responsible Cuba Policy, points to an April 15 fund-raiser in Miami that reportedly netted $2.5 million for President Obama. The event was hosted by the singer Gloria Estefan, whose father served as a bodyguard to Cuban dictator, Fulgencio Batista, who was overthrown by Castro in 1959.

"This perception that things are loosening is just nonsense. The embargo is tighter today than it has been at any time in the last 51 years," argues Fox.

But even though calls for lifting the embargo grow louder as Cuba's current leadership appears ready to change, many warn the U.S. not to jump the gun.

"American companies need to take in to account business interests are not necessarily the national interest all the time," said Frank Calzon, executive director of the Center for a Free Cuba, and independent organization promoting a democratic transition in the island-nation. "The Cuban regime is coming to an end, there is no question that they are on their last phase now and I think this is the worst possible time for anyone to try to invest."

--Contact Ken Stier at kenfortune@earthlink.net.


Wednesday, May 12, 2010

Optimism About Travel Legislation

11 May 2010 8:30 AM
By Patrick Mayock
Associate News Editor


SAN JUAN, Puerto Rico—When President Obama lifted long-standing restrictions on Cuban-Americans visiting their native island in April 2009 after nearly two decades, it seemed only a matter of time before the United States further eased its embargo on the Caribbean nation, potentially opening a flood of travel and investment while altering the landscape of the region’s tourism industry.

That time could be less than a year away, if pending legislation makes its way through Congress as is projected, panelists said during a general session at the 14th annual Caribbean Hotel & Tourism Investment Conference last week.

The Travel Restriction Reform and Export Enhancement Act (H.R. 4645), which prohibits the U.S. president from regulating travel to and from Cuba and liberalizes agricultural trade with the communist nation, could be brought to a vote in the House of Representatives as early as July, according to Timothy Ashby, a corporate attorney with Miami-based Sonnenschein Nath & Rosenthal.

The legislation already has enough votes to pass, Ashby said, though Speaker of the House Nancy Pelosi has asked bill co-sponsor Rep. Collin Peterson (D-Minnesota) to ensure 220 votes (the bill only needs 217 votes to pass) before she brings it to a vote.

If the bill passes the House, it will be attached to an appropriations bill in the Senate, which likely would be voted on between the midterm elections and the Christmas holiday recess, Ashby said. Then it would go to President Obama, who already has said he would sign it into law. The law would open travel to Cuba for all U.S. citizens beginning in 2011.

Impact on Caribbean

Lifting travel restrictions on Cuba would provide an immediate boon for the country’s travel industry, Ashby said.

U.S. travel restrictions to Cuba could be lifted by as early as next year, said Timothy Ashby of Sonnenschein Nath & Rosenthal.

Within the first year travel restrictions are lifted, the U.S. International Trade Commission predicts Cuba will receive between 554,000 and 1 million travelers from the U.S. The Cuban Ministry of Tourism agreed with those projections, adding the country could expect 3 million U.S. tourists within the first five years.

The Economist Intelligence Unit projects a 15-percent to 20-percent increase in international arrivals and a 10-percent increase per year in foreign exchange earnings, said Emily Morris, the Unit’s Cuba country analyst.

“By year 2014, you have Cuba just narrowly overtaking the Dominican Republic as the first tourist destination in the Caribbean,” she said.

Cuba is already preparing for this influx of visitors. The country is looking to expand its existing supply of 50,000 hotel rooms by at least 20,000 rooms during the next five years, according to Carlos Vogeler, regional representative for the Americas for the United Nations World Tourism Organization.

Even without expansion, the country's tourism industry is showing growth. Cuba received 2.4 million tourists during 2009, 40 percent of whom came from Canada, That represents a 3.4-percent increase from 2008 to 2009. (The world’s international tourism market declined 4.3 percent last year.)

The country received US$2.3 million in tourism-related receipts during 2009.

Any short-term benefits that befall Cuba would not adversely affect the rest of the Caribbean travel industry, the panelists agreed. On the contrary, lifting travel restrictions would instead strengthen the region’s appeal throughout the world.

“If such a thing would happen, it’s not something to fear in the Caribbean. It’s something to welcome,” Vogeler said. “That will definitely impact positively … the whole market.”

“Development of Cuban tourism actually creates a bridge for an increase in the total volume of tourists to the Caribbean,” Morris said, adding the island would create a natural route via air or sea for travelers and businesspeople.

Morris did acknowledge a short-term negative impact on the Dominican Republic, Cuba’s closest competitor. But after a slight setback during 2011, the country would eventually approach 5 million international tourist arrivals by 2014.


A lift of travel restrictions also could usher in a swell of U.S. investment in Cuba.

“The Cubans are also open to U.S. investment,” Ashby said. “ … They would welcome U.S. investors as they would welcome tourists.”

Friday, May 7, 2010

The Rubio File

Human Event Interviews Rubio

HE:  When we spoke a year ago, we discussed Cuba.  When would you approve of lifting the economic embargo against Cuba?

Rubio:  When Cuba joins the rest of the civilized world in how it treats its people.  That is freeing political prisoners, it means free and fair elections  They can choose any form of government they like, but they have to have freedom of the press, freedom of religion, freedom of expression.  The fundamental rights that we believe are endowed to every human being by our Creator.  That’s the kind of country that I’m interested in us having a relationship with.  And the embargo serves as leverage for us to be able to accomplish that.  You have, as we speak right now, a number of dissidents and hunger strikes in Cuba.  And their brave wives are marching every Sunday.  And they’re being beaten, taunted, hassled and harassed.  These are women.  They’re called the women in white.  They’re providing an extraordinary example of just how repressive this regime is and how it’s on the wrong side of history.

HE:  So I take it you mean the recognition of the end of the embargo has to come with the end of the Castro brothers?

Rubio:  Not only the end of the Castro brothers, but also political reform in the return of political freedom to the people of Cuba.  The embargo gives us leverage to negotiate that.  Cuba trades with every other country in the world.  The fact of the matter is that the U.S. embargo is not the reason their economy is failing.  Their economy is failing because they’ve embraced a combination of socialism and incompetence, which may be an oxymoron because they’re both the same thing.  The point being that I would love for the United States to have a close economic relationship with a free Cuba.  I think we’re going to see that very soon, God willing.

HE:  Now assuming that free and fair elections were held in this new environment that you described, would you support resuming diplomatic relations before the settlement of Cuban properties.

Rubio:  Before the settlement of Cuban properties in terms of their previous owners?  I think that’s something for the Cuban people to determine through their new political system that’s in place.  They have the right to that determination and to choose any form of government they please.  What I’m interested in is having the United States having strong diplomatic and economic ties to a free and fair Cuba. A lot of times past, the issue of property rights there was going to have to be confronted like it was confronted in Eastern Europe.  But I wouldn’t impose an external mandate.  I think the links between Cuban exiles and their families in Cuba are close enough that they will be able to establish some sort of an orderly process for property rights to be respected, either returned to their rightful owners or paid for their loss.

HE:  That leads to another question about the Obama Administration’s reverting back to the Clinton-era policy of travel and remittances by Cuban Americans to their families living on the island.  Does this help the cause of freedom?

Rubio:  It’s hard to tell people they can’t visit their dying grandmother or dying mom.  And I get that and it’s sad.  By the way, the Bush-era policies allowed people to travel once every three years.  Unfortunately, that’s not what’s happening.  What’s happening now is that the Castro government is using travel and exile travel as a way to fund its repressive regime.  I also think it threatens the immigration status of Cubans.  Cubans come to the United States on the basis of the Cuban Adjustment Act, which says that Cubans are exiles.  Cubans are here because they have no political freedoms.  But it’s hard to argue you’re in exile when a year and a month after you arrive, you’re returning repeatedly to the country you’re exiled from.  How do you argue that you’re an exile when exile is supposed to be people that can’t return for political purposes?  And after 13 months in the country, you’re traveling back?  It threatens the exile status of the Cuban community.  And it also provides a source of hard currency for the Castro regime.  They use the dollars from remittances and from travel to fund their repressive operation.  I think it was wrong to lift those travel restrictions. 



Monday, March 15, 2010

Why Are Florida Cubans Lukewarm On Rubio?

By David Gauvey Herbert

Marco Rubio was born in Miami to Cuban-born parents, became the first Cuban-American speaker of the Florida House, and he takes a hard line on U.S. policy towards Havana. Rubio leads Gov. Charlie Crist by approximately 28 percentage points in the race for the GOP Senate nomination, and in a matchup with Rep. Kendrick Meek, the presumptive Democratic nominee, he wins by 5 points.

So with Marco Rubio poised to become the nation's third Cuban-American senator, why haven't the rainmakers in Florida's Cuban-American donor community rallied to his side?

His challenges begin with the US-Cuba Democracy PAC. The Florida-based lobbying group is prolific, contributing more than $760,000 to congressional candidates in 2008. In this cycle, it had donated $225,000 to 111 House and Senate candidates across the political spectrum as of Feb. 21, according to the Center for Responsive Politics. Rubio is not one of them.

Instead, the PAC has thrown in its lot with Meek, already having given him $7,500 -- more than any other Senate candidate and as much as it gave Reps. Eliot Engel, D-N.Y., and Albio Sires, D-N.J., the top House recipients.

Mauricio Claver-Carone, the director for US-Cuba Democracy PAC's Washington operations, stressed that the committee has nothing against Rubio. At a December panel discussion hosted by the committee, Rubio, Crist and Meek all toed the same anti-Castro line, he noted. So then why Meek?

"He's the only one who's been in Congress and has a long track record of being an outspoken advocate for human rights and a strong Cuba policy," Claver-Carone said. "Charlie and Marco are great, and they would be great members of Congress, but they haven't had that yet. They've talked about it and they've advocated, but never from a legislative perspective."

Claver-Carone added that the PAC follows an "incumbency rule" in its giving and considers Meek an incumbent of sorts since he is currently in the House. But the PAC gave $7,000 to former Sen. Mel Martinez, R-Fla., in his 2004 campaign to become the first Cuban-American senator, even though Martinez had never served in Congress.

The 25 Cuban-Americans who make up US-Cuba Democracy PAC's board, which includes some of the biggest rainmakers in South Florida, haven't rallied behind Rubio either. As of the end of the fourth quarter 2009, its board members had donated $31,200 to Crist, $14,950 to Meek, and $73,800 to the Democratic Senatorial Campaign Committee, but just $8,150 to Rubio.

The donation numbers for the first quarter of 2010 are not yet available, and several members of the board did not return phone calls about their donations.

Rubio, despite his dominance in the polls, trails both Crist and Meek in cash on hand. Rubio had around $2 million in his coffers at the end of 2009, while Meek had $3.37 million and Crist had $7.56 million.

Does Rubio have a Cuban-American problem? No recent polls have broken down Cuban-American support for Rubio and Crist. But a Public Policy Polling survey released March 10 shows Crist faring better than Rubio with Hispanics in a general election matchup. Crist wins Hispanic voters -- Cuban-Americans account for close to half of Florida's Hispanic vote -- by a 43-22 margin over Meek in a potential matchup. Rubio, meanwhile, trails Meek by a 48-35 gap among Hispanics. Both Republicans would defeat Meek, according to the poll, but Crist enjoys a wider margin of victory, thanks in part to this differential.

Crist has a history of electoral success with this group: He won 70 percent of Cuban-American voters in his 2006 race for the governor's mansion.

Alex Burgos, a spokesman for Rubio's campaign, said he is confident his candidate has Cuban-American support.

"Marco is a product of this community," he said. "He is the proud son of Cuban exiles."

Still, while Rubio would love to carry the Cuban vote, Little Havana isn't his base. His most strident supporters have largely been white conservatives -- including Tea Partiers nationally. They are the ones who shook the rafters at his CPAC speech last month and continue to pour money into his coffers with one-day online fundraising drives, or "money bombs." Moderate Floridians still favor Crist, but among self-described conservative voters, Rubio trounces the governor by a 69-12 margin in the PPP poll.

Rubio, meanwhile, has taken stances at odds with the Latino community. He is against any immigration reform bill that provides a path to citizenship for the nation's 12 million illegal aliens; a spokesman said Rubio believes the 1986 amnesty was "a mistake." He also opposes counting undocumented immigrants in the Census for the purposes of federal aid and congressional reapportionment.

That stance drew a stern rebuke from Arturo Vargas, executive director of the National Association of Latino Elected and Appointed Officials. The organization honored Rubio in 2007 when he became the first Cuban-American leader of the Florida House, but "that was a very different Marco Rubio," Vargas told the Miami Herald last week.

"I know that in visiting Florida there has been some significant disappointment in the positions he's taken," Vargas told NationalJournal.com.

Cuban-Americans who want Washington to take a hard line with Havana need allies in Congress more than ever. One of Congress' most outspoken advocates for the Cuban embargo, Rep. Lincoln Diaz-Balart, R-Fla., announced last month that he will not run for re-election. Former Sen. Martinez, another strong anti-Castro voice, resigned in September before the end of his term.

The Obama administration, meanwhile, has tried to offer Havana an olive branch by loosening travel restrictions for Cuban-Americans. The US-Cuba Democracy PAC and other hardliners want Havana to release political prisoners and legalize opposition political parties before Washington offers any carrots.

It's worth noting that Crist has had problems in South Florida, too. Diaz-Balart and his brother, Rep. Mario Diaz-Balart (R), who are two of Congress' most anti-Castro members, pulled their endorsement of Crist in December. At the time, Lincoln Diaz-Balart remarked cryptically, "We take our endorsements seriously, but the governor knows why we withdrew and he left us with no alternative."


Posted on Wed, Dec. 30, 2009
Crist off his game

Charlie Crist is off his game. Way off his game, which was spectacular when it was good. He had the easy rhythm of public life down perfectly. Deferential to the Legislature (even when it didn't deserve it), easily accessible to the media (on a first-name basis with most) and wildly popular with most Floridians, Democrats as well as Republicans. Nowadays, Democrats have pretty much abandoned him, and hard-core GOP conservatives are flocking to Marco Rubio. Charlie's not only lost his mo, he's lost his mojo.
That was sadly obvious at the annual luncheon of the U.S.-Cuba Democracy PAC, which brought together nearly 400 of the biggest movers and shakers in the Cuban-American community last week to hear all the Senate candidates. It's a tribute to PAC's clout that all four agreed to appear in the same room at the same time. They wouldn't debate or take questions, but it was still the most important moment yet in this young Senate campaign. A very good moment for one of the candidates (Marco Rubio), pretty good to fair for two others (Maurice Ferre and Kendrick Meek) and an awful one for Crist.

Each candidate spoke for five to seven minutes, giving everyone a chance to compare and contrast. And what a contrast it was.

Democrat Ferre read a well-crafted, thoughtful speech linking progress on human and civil rights in Cuba to any future U.S. diplomatic overtures.

Fellow Democrat Meek pointed out that he has consistently voted against relaxing travel and trade with Cuba, followed the advice of his three Cuban-American congressional colleagues and has the president's ear.

Eloquent paean to free Cuba

Rubio delivered an eloquent and unscripted paean to a free Cuba that had intellectual heft and emotional power, particularly his disdain for Americans willing to put on moral blinders in order to sell Cuba food and agricultural products .

That left Charlie, who got up and said sincerely -- his favored leitmotif -- that he loves freedom and hopes Cuba will one day be free and a ``shining city on a hill'' like the United States is to the world. Then he told the story of his grandfather, Adam Christodoulou, who came to this country from Greece at the age of 8, shined shoes, saved his money and became an American success story.

It's a lovely story, although telling it over and over in political settings seems to both cheapen its value and aggrandize the teller. It certainly resonated with a roomful of Cuban immigrants, but I suspect the group at the Biltmore most wanted to hear the governor speak substantively about Cuba policy issues -- trade, travel, the embargo, freeing political prisoners and dealing with the Castros and their successors. From Crist, however, nary a word, only his hope that Cuba will one day be free. Inexplicably, the governor didn't refer to a set of talking points on Cuba that had been carefully prepared for him. ``He decided to ad lib for some reason,'' says one of the people who prepared the talking points for Crist. ``I don't know why.''

Key endorsement lost

More bad news for Crist was delivered the next day: Reps. Lincoln and Mario Diaz-Balart, arguably the two most popular Cuban-American politicians in South Florida, had withdrawn their endorsement. ``He knows the reason why,'' was all that Lincoln would say publicly.

One reason, I'm told, involves Crist ignoring Lincoln's recommendation for the appointment of a Gadsden County prosecutor to a local judgeship. Seems that prosecutor had mentored the congressman's son, Daniel, a law student at Florida State.

But there's more to it than pique over a rejected judicial appointment. The Diaz-Balart brothers have a close relationship with Kendrick Meek, who has followed their lead and that of Ileana Ros-Lehtinen on Cuba. The brothers were evidently feeling that by endorsing Crist they'd betrayed Meek, who sat on the sidelines instead of endorsing their Democratic opponents last year. So, the Diaz-Balarts met privately with Meek and his mother, former Congresswoman Carrie Meek, before the PAC luncheon and said they'll be sitting on the sidelines during the 2010 Senate race.

They'd told Crist a few weeks earlier, but it took a call from Lincoln's top aide last week to get the Crist campaign to remove the Diaz-Balarts' names as endorsers from the governor's campaign website.

Crist can still win the GOP Senate nomination without Cuban-American votes, but it will be very hard. Harder yet if he doesn't win over, or win back, hard-core conservatives and mainstream Republicans who are gravitating toward Rubio. The latest poll shows them tied -- tied! -- at 43 percent in a race that was Crist's to lose. Unless he straightens up, toughens up and smartens up, he will.

Wednesday, May 5, 2010

NCC CWS Letter to President re Religious Travel

May 4, 2010

President Barack Obama
The White House
1600 Pennsylvania Avenue, NW
Washington, DC 20500

Dear Mr. President:

We uphold you, Mrs. Obama, and your family in our fervent prayers, with every good wish for the health of our nation and its leadership toward a more peaceful and just world.

As leaders of Church World Service and the National Council of Churches in the USA, we write to you on behalf of our member communions to request that you end the restrictions on religious travel to Cuba. We appreciate your expressed willingness to review and revise long-standing U.S. policy toward Cuba and have
welcomed your removal of restrictions on Cuban-American travel. We urgently ask that you now change the Cuba policy of the United States in ways that will assist the churches in their work and have wider benefits for our country and for the people of Cuba.

Since 2005, U.S. church denominations, mission agencies and ecumenical organizations at the national and regional levels have suffered from severe restrictions on religious travel. Our institutions are currently eligible only for very limited licenses. Some of our institutions have been unable to secure even these limited licenses.

In 2008 we addressed an earlier letter to you wherein we stated:

These impractical restrictions have reduced our ability to send religious delegations to Cuba, limited our opportunities to accompany and support our Cuban church partners, and have the effect of severely limiting participation in Cuba missions by many U.S. churches and congregants.

Churches across the theological spectrum have called for the elimination of these restrictions which have now interrupted relationships, fellowship, and exchanges which began more than one hundred and twenty-five years ago.

Insomuch that Congressional action is not required, we ask you to lift these restrictions. This is a matter of direct institutional importance to U.S. communions and religious institutions.

Beyond this immediate step, we also ask that OFAC liberally grant visas for U.S. travel to Cuban pastors and other religious leaders; and, work closely with Congress to end the travel ban for all Americans. We are convinced that it is time to change this ineffective and counter-productive U.S. policy toward Cuba.

Thank you for your considered attention to these concerns of the churches.

Respectfully yours,

Rev. Dr. Michael Kinnamon
General Secretary
National Council of Churches of Christ in the USA

Rev. John L. McCullough
Executive Director and CEO
Church World Service

c/o Martin Shupack, Church World Service, 110 Maryland Ave., Suite 404, Washington, DC 20002 shupack@churchworldservice.org; 202-481-6934


Monday, April 19, 2010

Business Letter Supporting Ag and Travel Legislation

April 13, 2010

The Honorable Collin C. Peterson
U.S. House of Representatives
2211 Rayburn House Office Building
Washington, DC 20515-2307

Re: H.R. 874, To Allow Travel Between the United States and Cuba

Dear Congressman Peterson:

We write to express our strong support for H.R. 874, which would remove restrictions on U.S. citizens to travel to Cuba.

The United States should immediately remove travel restrictions and allow Americans to act as ambassadors of freedom and American values to Cuba. From farmers and manufacturers to human rights and religious groups, as well as a large and growing number of Cuban Americans,the American people recognize the unfairness and incongruity of restricting travel to Cuba. It is simply wrong that American citizens cannot travel freely to Cuba but are not restricted by the
United States from traveling to places like North Korea and Iran.

Current policies towards Cuba have clearly not achieved their objectives. Without the support of our allies and the larger international community, U.S. sanctions serve only to remove the positive influences that American businesses, workers, religious groups, students and tourists have in promoting U.S. values and human rights. Sanctions are also blunt instruments that generally harm the poorest people of the target country rather than that country’s leaders.

This is certainly true of the U.S. ban on travel to Cuba. The United States continues to lose influence by voluntarily isolating its citizens from Cuba. Far from providing leverage, U.S. policies threaten to make the United States virtually irrelevant to the future of the island.

We support the complete removal of all trade and travel restrictions on Cuba, and believe that Congress has a unique opportunity to take a step forward to end nearly 50 years of isolation from the Cuban people by passing H.R. 874. We urge your support for this important piece of legislation. Continuation of the status quo could leave the United States isolated from the Cuban people for another generation.


Coalition of Service Industries
Emergency Committee for American Trade
Interactive Travel Services Association
National Foreign Trade Council
National Retail Federation
Organization for International Investment
U.S. Chamber of Commerce
U.S. Council for International Business

Rep. Mike Honda Op Ed Calling for End of Embargo

Time to lift the embargo on Cuba

Few know that Cuba, infamous for its socialism, cigars and salsa, was recently the United States' largest rice export market and is the fifth largest export market in Latin America for U.S. farm exports. Cuba holds $20 billion in trade with America over a three-year term. Our economy could benefit mightily from better relations, yet we alienate this potential ally.

When I traveled to Cuba with a congressional delegation, it became clear that the embargo is imprudent politically, economically and socially. Everyone we met with -- U.S. and Cuban government officials, trade organizations, journalists, cultural attachés, foreign diplomats and rural farmers -- confirmed this point.

Politically, now that Latin America stands beside Cuba -- as evidenced by diplomatic reinstatements with holdouts El Salvador and Costa Rica -- and the reintegration of Cuba into the Organization for American States and the Community of Latin American and Caribbean States (CLACS) -- the United States risks ruinous relations with countries who see the blockade as backward. The United States is already marginalized: CLACS explicitly bars U.S. participation.

The impact of this Latin tack towards insularity is not insignificant. Consider grandstanding by Brazil's President Lula da Silva, who rebuffed Secretary of State Hillary Clinton's efforts to bring Brazil in on Iran sanctions while courting Cuba's leadership. Lula, capitalizing on Cuba's appetite for growth, proposed investments in industrial, agriculture and infrastructure projects, including ports and hotels, and an agreement with Brazil's oil company.

We will see more of this. The Cubans are seeking suitors. Like the Bank of the South, Latin America's attempt to wean countries off U.S. institutions like the World Bank, the longer we keep Cuba at arm's length, the more likely Brazil and others will take our place. The longer we keep Cuba listed as a state sponsor of terrorism, an allegation roundly criticized by diplomats, the more we risk the credibility of our national security regime and reputation in the region.

Economically, the case for cooperation is even clearer. Despite the trade embargo, there is some engagement. Cuba continues to be reliant on U.S. agriculture. Since 2002, we have been Cuba's largest supplier of food and agricultural products, with Cuba purchasing more than $3.2 billion worth of products since 2001.

This agricultural reliance is in jeopardy, which puts American farmers at risk. In 2008, U.S. food imports to Cuba totaled $712 million, declined to $533 million last year and are declining this year. Cuba, having witnessed strong economic growth in the early 2000s at 11 and 13 percent, is now struggling to make ends meet, slipping below 2 percent in 2009. Beyond foodstuffs, other natural resources offer potential for partnership. The U.S. Geological Survey estimates nine billion barrels of oil are available in Cuba, plus an estimated nine billion cubic meters of natural gas. The Cuban government cites higher oil numbers, at 20 billion barrels. Either way, there's money to be made, and Cubans welcome participation. While the United States disengages, countries like Brazil, Russia, Venezuela and China are talking. We are clearly missing investment opportunities.

Socially, Cubans emphatically embrace the cultural convergences between our countries. Their love of music, art, dance, history and architecture is ubiquitous, drawing 2.5 million tourists annually to Cuba, 800,000 of which are Canadian. If the travel ban was lifted, two million Americans are expected to travel there immediately, and ultimately growing to four million. This is hardly surprising. Havana retains the Caribbean's largest, oldest, and best-preserved Spanish colonial architecture. The city's charm is intoxicating.

We should expand cooperation on education, medicine, science and sports through nonpolitical, people-to-people exchanges. The U.S. president has the authority to return the rules for academic, science, religious and other ``purposeful travel'' so that exchange can flourish again. This is how we rebuild relations.

None of this negates the sobering negatives characterizing U.S.-Cuba relations. Cubans remain poor, irrespective of education (at nearly 100 percent literacy) and healthcare (everyone is covered, for everything). The government is inadequately serving the population, and there is a palpable, public rethink surfacing within society, from government officials to academics to farmers. Reform is coming, though not as soon as, or in the form, the United States prefers.

America's annual $60 million in democracy-building, which is covertly distributed for explicitly stated regime change, exacerbates the problem by goading the government, jeopardizing the safety of reformers and marginalizing the U.S. Interests Section there. The American penchant for positioning Cuba-related communiqués as primarily human-rights reprimands resonates rankly as an inconsistent singling out.

Amid the acrimony, the United States and Cuba are cautiously coordinating on areas of mutual interest, like migration, counter-narcotics and disaster preparedness. The United States must build on this sooner rather than later, before others opt in while we opt out.

Cuba is not the enemy. She may frustrate the American proclivity for democracy promotion, but her behavior is nothing near as nefarious as U.S. allies elsewhere. The time to engage is now. Cubans are increasingly confabbing about reform while we sideline ourselves from the conversation.

Michael Honda is a U.S. congressman from the 15th District in California.

Read more: http://www.miamiherald.com/2010/04/13/v-fullstory/1577713/time-to-lift-the-embargo-on-cuba.html#ixzz0lbVZM0tV

Monday, April 12, 2010

Secretary of State at University of Louisville

Hillary Rodham Clinton
Secretary of State
University of Louisville
Louisville, KY
April 9, 2010

QUESTION: Thank you, Senator Clinton. Given the fact that probably the Cuban missile crisis may be the greatest example of a deterrent, that’s been almost 50 years ago. Is there any talk within the Department of maybe normalizing relationships with Cuba?

SECRETARY CLINTON: That’s a really – that’s a topic of conversation a lot. I don’t think that there is any question that, at some point, the people of Cuba should have democratically elected leaders and should have a chance to chart their own future. But unfortunately, I don’t see that happening while the Castros are still in charge. And so what President Obama has done is to create more space, more family travel, more business opportunities to sell our farm products or for our telecom companies to compete dealing with common issues that we have with Cuba like migration or drug trafficking. In fact, during the height of the terrible catastrophe in Haiti because of the earthquake, we actually helped some of the Cuban doctors get medical supplies who were already operating there.

So there are ways in which we’re trying to enhance our cooperation. But it is my personal belief that the Castros do not want to see an end to the embargo and do not want to see normalization with the United States, because they would then lose all of their excuses for what hasn’t happened in Cuba in the last 50 years. And I find that very sad, because there should be an opportunity for a transition to a full democracy in Cuba. And it’s going to happen at some point, but it may not happen anytime soon.

And just – if you look at any opening to Cuba, you can almost chart how the Castro regime does something to try to stymie it. So back when my husband was president and he was willing to make overtures to Cuba and they were beginning to open some doors, Castro ordered the – his military to shoot down these two little unarmed planes that were dropping pamphlets on Cuba that came from Miami. And just recently, the Cubans arrested an American who was passing out information and helping elderly Cubans communicate through the internet, and they’ve thrown him in jail. And they recently let a Cuban prisoner die from a hunger strike. So it’s a dilemma.

And I think for the first time, because we came in and said, look, we’re willing to talk and we’re willing to open up, and we saw the way the Cubans responded. For the first time, a lot of countries that have done nothing but berate the United States for our failure to be more open to Cuba have now started criticizing Cuba because they’re letting people die. They’re letting these hunger strikers die. They’ve got 200 political prisoners who are there for trivial reasons. And so I think that many in the world are starting to see what we have seen a long time, which is a very intransigent, entrenched regime that has stifled opportunity for the Cuban people, and I hope will begin to change and we’re open to changing with them, but I don’t know that that will happen before some more time goes by (Applause.)

Wednesday, March 17, 2010

US, Cuban officials discuss Haiti quake assistance

US, Cuban officials discuss Haiti quake assistance
17 Mar 2010 23:40:07 GMT
Source: Reuters
* Meeting held at experts' conference in Santo Domingo

* Cuba, U.S. involved in huge Haiti relief effort

By Manuel Jimenez

SANTO DOMINGO, March 17 (Reuters) - U.S. and Cuban officials met in the Dominican Republic on Wednesday to discuss international cooperation on assistance for Haiti after the catastrophic earthquake there, diplomats said.

The meeting took place in Santo Domingo on the sidelines of an international conference of experts and officials from the Haitian government, donor nations, United Nations agencies and humanitarian groups to draft a reconstruction plan for the poor, quake-stricken Caribbean nation.

The United States sent thousands of soldiers and aid workers to Haiti after the Jan. 12 earthquake, and Cuba sent hundreds of doctors and health personnel, all part of a huge international relief effort. Haiti says more than 300,000 people may have been killed in the catastrophe.

Diplomats said Cheryl Mills, counselor and chief of staff to U.S. Secretary of State Hillary Clinton, and another senior State Department official, Julissa Reynoso, met in Santo Domingo with Cuban Deputy Foreign Minister Rogelio Sierra and a senior Cuban Health Ministry official.

Washington maintains a longstanding trade embargo against communist-ruled Cuba and nearly a half-century of hostile relations means that high-level meetings between the two countries are few and far between.

The diplomats, who asked not to be named, said the U.S. and Cuban officials discussed aid for Haiti, including Cuba's capacity to help provide medical care for the hundreds of thousands of injured and homeless Haitian quake victims. More details of what they discussed were not immediately known.

The U.S. delegation also held separate meetings with delegations from several other countries, including Venezuela, the diplomats said.

Venezuelan President Hugo Chavez, like his ally Cuba, is a fierce critic of U.S. policies. Shortly after the quake, Chavez accused the United States of using the disaster as a pretext to occupy the devastated Caribbean country by sending troops. He recommended Washington should send doctors instead.

Three days after the quake, U.S. officials announced the Cuban government had agreed to let the U.S. military use restricted Cuban air space for medical evacuation flights carrying Haitian victims, sharply reducing the flight time to Miami.

Some analysts expressed hopes that this kind of U.S.-Cuban cooperation could lead to a thaw in frosty ties between Havana and Washington, which U.S. President Barack Obama said last year he would like to restore to a better footing.

But the Feb. 23 death of a Cuban political prisoner on a hunger strike, and the continuing detention in Cuba of a U.S. contractor accused by Havana of distributing illegal communications equipment have stoked mutual criticisms between the two longtime ideological enemies.

The experts meeting in Santo Domingo this week worked on a draft of a reconstruction plan for Haiti, whose leaders say $11.5 billion will be needed for recovery and rebuilding in what was already the Western Hemisphere's poorest state.

The plan will be presented for approval and funding at an international donors conference in New York on March 31. (Editing by Pascal Fletcher and Eric Beech)

Sunday, March 7, 2010

Minnesota Agricultural Delegation

MARSHALL, Minn. — Kari Howe, regional economic development program specialist with the Minnesota Department of Employment and Economic Development, was part of the Minnesota Agriculture and Rural Leadership program international mission to Cuba Feb. 15 - 25

Howe of Bemidji was a member of the 36-person MARL Class V delegation that departed from Minneapolis for Miami on Feb. 15.

Florida provided a preamble for the group of the culture and agriculture it would see in Cuba. The group spent Monday and Tuesday in Florida to learn about U.S. agricultural industries comparable to those it would see in Cuba.

The charter flight from Miami to Havana departed on Wednesday.

“This was a valuable experience for MARL participants,” said Tim Alcorn, MARL executive director. “Our time in Florida was a great primer for the Cuba agriculture we saw. We left Cuba with a far better feel for the economic issues facing the communist country as a result of the U.S. embargo that has been in place since the Cuban revolution in 1959.”

MARL program leader Mike Liepold said the current state of U.S. and Cuban relations impacted the trip. “It was like being in time travel. There was 100 years of technology differences living side by side everywhere, Liepold said.

“There were 1950 Chevys all over. We saw 20,000-acre farms, next to people working fields with oxen. We saw homes constructed with marble interiors and basic one-room houses in the country. We met with government farm managers and workers as well as a few independent growers. It was meeting with the Cuban people that we found especially memorable. The trip was truly a life-changing experience,” he said.

The group’s agenda during its nine days in Cuba included stops that helped participants understand the country’s food distribution systems, both the staple commodity grain markets for the ration stores and the higher value restaurant and tourist food markets. Both are current markets for Minnesota farmers. Estimates place the growth potential of the market at over $1 billion if the current travel ban were ended.

Examples of food distribution system stops include a farmers’ market where Cubans with higher incomes purchase food to supplement the rations of staples provided by the government. Also, a grocery much like a U.S. supermarket, but with far more limited types and quantities of food available, including processed and frozen foods. The market and store were busy, but only a small percentage of Cubans can afford to purchase food at either business.

The group also saw portions of the Cuban agricultural production systems, including a state-run farm called Finca Cimex, where vegetables and ornamental plants, primarily cactus, are grown.

The time spent learning about the cane sugar industry in Florida proved beneficial as a stop was made at a closed cane sugar mill. Nearly half of the mills in Cuba were shuttered from 2000–2009. While the local mill was closed, cane is still produced in the area for processing at a different mill 200 kilometers away.

The Cuban market also holds good potential for tourism, which translates into demand for higher quality foods, particularly dairy and meat products that Minnesota could provide in the future. Cuban restaurant menus already heavily feature pork, chicken and cheese, but good quality beef and dairy products are in short supply. The proximity to Cuba gives the U.S. a natural advantage in the delivery of fresh, high quality food products simply because of transportation advantages.

However, the barrier to shipping beef, dairy, and many other products for that matter, into Cuba is price. The route that many products must take to get to Cuba under the U.S. trade embargo makes them extremely expensive, which places U.S. products at a competitive disadvantage when trying to serve the tourists to the country, who come primarily from Canada and Europe, with a smaller percentage from Mexico and South American countries.

The state of relations with Cuba is an ongoing political process in the U.S. Congress. While the MARL group was in Cuba, U.S. Rep. Collin Peterson, chairman of the U.S. House Agriculture Committee, was preparing legislation for introduction to make the sale of agricultural products to Cuba easier. Also included in the bill is language to ease the tight travel restrictions that prevent most U.S. citizens from being allowed to travel to Cuba.

The MARL program is a public-private partnership. Southwest Minnesota State University administers it and the University of Minnesota Extension coordinates the curriculum. The program is privately funded. Class members pay a participation fee, but the majority of funding comes from contributions from private sector associations, organizations, businesses, corporations, foundations, and individuals provide the majority of the funds to operate the program.

Two-thirds of the participants are agricultural producers and the other third are agribusiness people and other types of rural leaders.


Thursday, February 25, 2010

H.R. 4645 Travel Restriction Reform and Export Enhancement Act

Travel Restriction Reform and Export Enhancement Act (Introduced in House)

HR 4645 IH


2d Session

H. R. 4645

To remove obstacles to legal sales of United States agricultural commodities to Cuba and to end travel restrictions on all Americans to Cuba.


February 23, 2010

Mr. PETERSON (for himself, Mr. MORAN of Kansas, Ms. DELAURO, Mrs. EMERSON, Mr. DELAHUNT, Mr. FLAKE, Mr. MCGOVERN, Mr. BERMAN, Mr. BERRY, Ms. EDDIE BERNICE JOHNSON of Texas, Mr. CHILDERS, Mr. MINNICK, Mr. BOSWELL, Ms. HERSETH SANDLIN, Mr. SCOTT of Georgia, Mr. MASSA, Mr. BRIGHT, Mr. ELLSWORTH, Mr. HOLDEN, Mr. KAGEN, Mr. SNYDER, Mr. POMEROY, Mr. KIND, Mr. DAVIS of Tennessee, Mr. BOUSTANY, Mr. COSTA, Mr. BISHOP of Georgia, Mr. ROSS, Mr. TANNER, Mr. JOHNSON of Illinois, Mr. RYAN of Ohio, Mr. HINCHEY, Ms. LEE of California, and Mr. BOUCHER) introduced the following bill; which was referred to the Committee on Foreign Affairs, and in addition to the Committees on Agriculture and Financial Services, for a period to be subsequently determined by the Speaker, in each case for consideration of such provisions as fall within the jurisdiction of the committee concerned


To remove obstacles to legal sales of United States agricultural commodities to Cuba and to end travel restrictions on all Americans to Cuba.

Be it enacted by the Senate and House of Representatives of the United States of America in Congress assembled,


This Act may be cited as the `Travel Restriction Reform and Export Enhancement Act'.


(a) In General- On and after the date of the enactment of this Act, and subject to subsection (b)--

(1) the President may not regulate or prohibit, directly or indirectly, travel to or from Cuba by United States citizens or lawful permanent residents, or any of the transactions incident to such travel; and

(2) any regulation in effect on such date of enactment that regulates or prohibits travel to or from Cuba by United States citizens or lawful permanent residents or transactions incident to such travel shall cease to have any force or effect.

(b) Exceptions- Subsection (a) shall not apply in a case in which the United States is at war with Cuba, armed hostilities between the two countries are in progress, or there is imminent danger to the public health or the physical safety of United States travelers.

(c) Applicability- This section applies to actions taken by the President before the date of the enactment of this Act that are in effect on such date of enactment, and to actions taken on or after such date.

(d) Inapplicability of Other Provisions- The provisions of this section apply notwithstanding section 102(h) of the Cuban Liberty and Democratic Solidarity (LIBERTAD) Act of 1996 (22 U.S.C. 6032(h)) and section 910(b) of the Trade Sanctions Reform and Export Enhancement Act of 2000 (22 U.S.C. 7210(b)).


Section 908(b)(4) of the Trade Sanctions Reform and Export Enhancement Act of 2000 (22 U.S.C. 7207(b)(4)) is amended--

(1) in subparagraph (B), by striking `and' at the end;

(2) in subparagraph (C), by striking the period at the end and inserting `; and'; and

(3) by adding at the end the following:

`(D) the term `payment of cash in advance' means, notwithstanding any other provision of law, the payment by the purchaser of an agricultural commodity or product and the receipt of such payment by the seller prior to--

`(i) the transfer of title of such commodity or product to the purchaser; and

`(ii) the release of control of such commodity or product to the purchaser.'.


Notwithstanding any other provision of law, the President may not restrict direct transfers from a Cuban financial institution to a United States financial institution executed in payment for a product authorized for sale under the Trade Sanctions Reform and Export Enhancement Act of 2000 (22 U.S.C. 7201 et seq.).

Tuesday, February 9, 2010

Is travel legislation in trouble?

Cuba travel bill buried in political agenda
1:05am EST

By Esteban Israel

WASHINGTON (Reuters) - A bipartisan drive in Congress to end a Cold War-era travel ban on Cuba was buried during the healthcare reform debate but its supporters hope to dig it out this year.

Sponsors of two bills allowing Americans to travel freely to Cuba, introduced last year in the Senate and the House of Representatives, say a flood of dollars from the pro-embargo Cuban-American lobby might also have played a part.

"Support has not waned but it's clear that the debate over healthcare has consumed the first year of the (Obama) administration and has had a similar impact in terms of congressional action," Representative Bill Delahunt, a Democrat and one of the authors of the bill, told Reuters.

Co-sponsor Jeff Flake, a Republican representative, said the votes were there to pass the Freedom to Travel to Cuba Act this year but the Democratic majority in the House was divided over whether to take it to the floor for a vote.

"This is not an issue that is at the top of their agenda or anywhere close and it's also an issue that splits part of their caucus," he said. "I still think it could happen this year."

The bill has 178 backers in the House, 40 votes short of the 218 needed but still a "big number," Flake said.

If passed, the act would be a bold step toward ending the 48-year U.S. trade embargo against Cuba and likely would flood the communist-run Caribbean island with American tourists attracted by its beaches and revolutionary mystique.

The U.S. National Tour Association estimates at least 850,000 Americans would fly to Cuba, just 90 miles off the Florida coast, in the first year after sanctions were lifted. U.S. and Cuban tour operators will meet next month in the Mexican resort of Cancun to draw up plans for that day.

The Cuba travel bills were introduced last year as President Barack Obama promised to "recast" troubled relations with Cuba. But the expectations raised when Obama lifted travel restrictions for Cuba-Americans are now all but gone.


The explanation may lay, in part, in a strategy change by Cuban-Americans opposed to the Castro leadership. In the last few years, they have given Democratic lawmakers generous donations in the hopes of preventing any relaxation of the U.S. trade embargo.

Public Campaign, a non-partisan group, estimated hardline Cuban-Americans gave more than $10 million in contributions to politicians since 2004.

Mauricio Claver-Carone, director of the pro-embargo U.S.-Cuba Democracy Public Action Committee, sees a clear link between those money flows and the apparent stall of the bills.

"There is undoubtedly a connection," he told Reuters. "One of our goals was to break the political barrier and make Cuba policy a bipartisan issue."

U.S. tourism would be a life-line for the cash-strapped Cuban government, he said, allowing it to almost double the island's gross domestic product in the first year.

Divisions among Democrats emerged in November when 53 representatives signed a letter against any changes in the U.S. Cuba policy based on human rights concerns.

Public Campaign said 51 of the 53 had received a total of more than $850,000 in contributions from the U.S.-Cuba Democracy Public Action Committee and other pro-embargo donors.

"The letter, I think, was a strong indication the votes are not there," Representative Debbie Wasserman Schultz, a Democrat from Florida who gathered the signatures, told Reuters.

"I have about 20 more Democrats who didn't sign the letter but would not vote to lift the travel ban. That, combined with the overwhelming majority of Republicans, indicates the votes are just not there."

Supporters of the bill acknowledge the Public Action Committee has been effective.

"They've always had money and, in Washington, money talks," said Delahunt.


Supporters of the bill play down the impact of recent rifts between Washington and Havana, notably Cuba's detention last December of a U.S. contractor accused of distributing illegal satellite communications gear.

Cuban President Raul Castro, who took over from his ailing older brother Fidel in 2008, said the contractor incident showed Obama was committed to destroying the island's socialist system, just as his 10 predecessors were.

The renewed tension was reflected in The Washington Post's editorial page, where a recent piece said the travel bill should be frozen until Cuba frees the detained contractor.

But supporters called it "background noise" and said the act was not so much about rewarding the Cuban government as guaranteeing the right of Americans to travel.

Senator Byron Dorgan, a Democrat whose bill has 38 co-sponsors, said the current policy only punishes Americans.

"This describes the goofy position we put ourselves in by inhibiting the right of the American people to travel," Dorgan said. "Do you think there will be a ghost of a chance of saying we are going to now restrict the right of the American people to travel to China? You will be run out of town."

(Editing by John O'Callaghan)


My comment:

The key to success in Congress is the leadership role of the President. He needs to reverse the Bush Administration's crippling restrictions on educational, cultural, religious and humanitarian people-to-people travel. He should also make clear that he is prepared to sign legislation to end all travel restrictions.

John McAuliff
Fund for Reconciliation and Development