Nearly a year and a half ago, President Barack Obama and Cuban President Raúl Castro announced they would reestablish diplomatic relations between their two countries, setting the United States and Cuba on course for normalized relations. But while the U.S. government only launched negotiations with Cuba a short time ago, the U.S. Chamber and the American business community have been pushing for a new approach toward the U.S.-Cuba relationship for nearly two decades.
At long last, we’re moving in the right direction – but we still have a long way to go.
The U.S. Chamber and Cuba: A Longstanding History
During U.S. Chamber President and CEO Tom Donohue’s first visit to Cuba in 1999, he told a crowd gathered at the University of Havana that it was “time to open a new chapter in relations between the people of the United States and the people of Cuba. The U.S. Chamber of Commerce stands ready to assist in that process.” In the 17 years since, that readiness has never wavered.
Not long after his visit, the U.S. Chamber came out actively in favor of the Trade Sanctions Reform and Export Enhancement Act of 2000 (TSRA), which opened the door to U.S. agricultural exports to Cuba. Five years later, the U.S. Chamber actively engaged the U.S. Treasury Department’s Office of Foreign Assets Control concerning payment procedures impacting the legitimate sale of agricultural products to Cuba, and in 2008, we helped lead an association letter to President-elect Obama in support of his promise of change with regard to U.S. policy toward Cuba.
In the years that followed, the U.S. Chamber has sent numerous letters to the Hill in support of legislation like the 2009 “Freedom to Travel to Cuba Act” and the 2010 “Travel Restriction Reform and Export Enhancement Act.” With momentum building and rumors of real change taking root in Cuba, the Chamber launched a Cuba Working Group in 2012 to help members understand the ongoing developments in the island nation.
Numerous Cuba Working Group meetings in Washington culminated with a visit to Havana in 2014 by Donohue and several American business leaders. While there were some lingering reminders of Fidel Castro’s Cuba of the 1960s, the Cuba they saw that year saw was a very different country than the one upon which sanctions were placed a half century ago, or the Cuba that was a Soviet outpost in the ‘70s and ‘80s. It was clear that change was underway, and the U.S. Chamber has since pressed both governments for continued improvement in the bilateral relationship.
Recent Developments and Historic Visits
Over the past year and a half, there has been much change on both sides of the 90-mile straight.
First, the U.S. and Cuban governments have hosted a series of senior-level negotiations on a key issues, which led to the re-opening of embassies in Havana and Washington, Cuba’s removal from the U.S. terrorist sponsor list, and the signing of several bilateral memorandums of understanding, or MOUs. In addition, the U.S. Commerce and Treasury Departments have made four rounds of changes to the regulatory mechanisms enforcing the U.S. embargo, making it easier for American companies to do business in Cuba while also empowering the growing Cuban private sector.
Meanwhile, Cuba has increased the number of Wi-Fi hotspots on the island from zero to 65, reduced the cost of wireless Internet usage by 50 percent, and upped mobile phone subscriptions over the past seven years from 300,000 to more than 3 million. New laws passed allow citizens and permanent residents to buy and sell real estate for the first time since the ‘60s, and in the past five years, the number of self-employment licenses rose more than five-fold to well over 500,000, Today, private sector employment now accounts for up to 40 percent of the Cuban labor force.
Building on these historic changes, and with support from senior U.S. and Cuban government officials and U.S. Chamber’s member companies, the U.S. Chamber last September launched the U.S.-Cuba Business Council (USCBC) in Washington. The group’s long-term objective is to create a barrier-free economic and commercial partnership between the United States and Cuba. Following the launch, at the invitation of the Cuban government, USCBC led the first formal U.S. delegation to participate in the International Trade Fair of Havana—Cuba’s most important annual business and investment event. With more than 60 senior executives and over 30 companies on hand, the delegation was able to foster specific legal commercial opportunities for members.
In recent months, USCBC has continued to work with and forge new relationships between members of Congress, the U.S. Administration, and the Cuban government. The historic visit of Cuban Trade Minister Rodrigo Malmierca to the U.S. Chamber of Commerce in February provided USCBC with such an opportunity to advocate the Council’s policy priorities with both governments.
One month later, on March 20, Obama took another historic step by visiting Havana, marking the first time a sitting U.S. president has set foot in the nation since 1928. As part the president’s trip, USCBC led a 40-person delegation to Cuba to participate in events surrounding the president’s visit. Our delegation pressed forward on USCBC’s congressional agenda by hosting a forum with roughly 40 members of Congress who made the trip to Havana, and we took part in an "Entrepreneurship and Opportunity Event," during which Obama recognized the work of the U.S. Chamber and USCBC in supporting the growth of Cuba’s small and medium-sized businesses.
As Chairman Gutierrez said during a White House Press Briefing in Havana in March: "The right to make a living is one of our most precious rights. We value that very, very much in the U.S. And that's what's happening today in Cuba. Cubans are being enabled to start their own business and to develop their own future, their own vision for their life. And we are contributing to that."
Since that historic trip, a number of USCBC member companies have signed commercial agreements in Cuba. In March, General Electric and the Cuban government signed MOUs to "express our joint interest in exploring potential opportunities" in the areas of aviation, healthcare and energy equipment. Carnival Corp. also struck an accord with Cuban officials and subsequently announced that its first voyages from the U.S. to Cuba will begin in May.
What’s Next for the U.S. and Cuba?
Ultimately, until the U.S. Congress takes action, the generations-old U.S. embargo on Cuba will not be lifted and the promise of a stronger U.S.-Cuba relationship cannot be fully realized. While the U.S. Chamber has already held hundreds of meetings with members of Congress over the past two years as we look to facilitate a pragmatic conversation on the changing U.S.-Cuba landscape, advancing anything in the current political environment will be extremely difficult.
In the meantime, USBCBC has urged Cuban leaders to build on the positive steps they have taken in recent months by implementing a more ambitious economic reform agenda, including liberalizing the labor market, unifying the dual currency system, and providing training to entrepreneurs. And we’re calling on our elected leaders to support the American business community by continuing to reform rules and regulations impacting trade and travel. In addition, Congress must reevaluate the reasons the U.S. implemented the embargo in the first place and carefully assess its consequences for the Cuban people, bilateral ties, and U.S. interests across the Americas.
Clearly, the seeds of positive change have been sowed, and as U.S. Chamber Executive Vice President and Head of International Affairs Myron Brilliant wrote recently, “the first green shoots show real promise.” But there are still hurdles that linger and challenges to overcome on both sides in order to cultivate a U.S.-Cuba relationship that truly benefits both countries.