Developments in U.S.-Cuba Normalization

As noted in a prior post, on September 12, 2015, the U.S. and Cuba established an agenda for their bilateral commission to address various issues relating to normalization of relations. Since then there has been limited progress on that agenda.

On September 18, the U.S. Departments of Treasury and Commerce issued new regulations to ease sanctions related to travel, telecommunications and internet-based services, business operations in Cuba, and remittances. The new rules will allow U.S. companies to establish offices and subsidiaries in Cuba, permit joint ventures between U.S. and Cuban firms and make it easier for airlines and cruise ships to import parts and technology to Cuba to improve the safety of their operations.[1]

Secretary Penny Pritzker in Cuba
Secretary Penny Pritzker in Cuba
Secretary Pritzker with Cuban children
Secretary Pritzker with Cuban children

 

 

 

 

 

On October 6 and 7, U.S. Commerce Secretary Penny Pritzker was in Cuba to launch a new Regulatory Dialogue between the U.S. and Cuba focused on the impact of new U.S. regulations by her Department and by the Department of Treasury’s Office of Foreign Assets Controls (OFAC). The Dialogue also gave Secretary Pritzker and additional U.S. officials from the Departments of Commerce, State, and Treasury the opportunity to hear from their Cuban counterparts on the structure and status of the Cuban economy. Secretary Pritzker also visited the Mariel Special Development Zone with U.S. charge d’affaires Jeffrey DeLaurentis.[2]

On October 27-30, high-ranking officials of the U.S. Department of Homeland Security visited Cuba to meet with leaders in the Cuban Ministries of Interior, Transportation and Foreign Relations. Issues discussed included aviation security, combating drug trafficking, cybersecurity and resumption of passenger ferry services between Havana and Florida.[3]

Secretary Mayorkas in Havana
Secretary Mayorkas in Havana

The DHS delegation was led by the Department’s Deputy Secretary, Alejandro Mayorkas, who as an infant left Cuba with his family in 1960. On the last afternoon of his DHS trip, he visited a family cemetery, where his grandmother, great aunt and great uncle are buried as well as his father’s elementary school and steel-wool factory. His Cuban hosts, Mayorkas said, were aware of his personal history and “could not have been more gracious and kind” in presenting him with a gift: his family’s original Cuban government immigration file.[4]

The last week of October also was the occasion for the annual Havana International Fair. Attending was an U.S. Chamber of Commerce delegation of 40 U.S. companies including Caterpillar, Amway, Sprint and Cargill for meetings with Cuban officials and the first board meeting of the U.S.-Cuba Business Council, a group dedicated to trade between the two countries. Jodi Bond, the Chamber’s vice president of the Americas, said the council was optimistic that trade will begin to flow between the U.S. and Cuba as each country figures out how to harmonize clashing sets of byzantine regulations. “We want to see U.S. products as part of that beautiful build-out of Cuba,” Bond said. “We’ve done this in so many markets around the world we know that it just takes time.” One of the U.S. companies in the delegation, Sprint, signed an agreement with Cuba to broaden its service to the island[5]

The U.S. and Cuba also are discussing cooperation on baseball, including making it easier for Cuban players to join U.S. professional baseball organizations and for U.S. major league teams to play spring games in Cuba.[6]

Despite these developments, there are voices of disappointment that the process of normalization is not leading to more business transactions. Another post will explore possible reasons for the slow pace of such transactions.

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[1] U.S. Announces Concrete Improvements in Relations with Cuba (Sept. 18, 2015).

[2] Dep’t of Commerce, Secretary Penny Pritzker’s Trip to Cuba (Oct. 15, 2015)  Davis, U.S. Commerce Chief Makes a Pitch in Cuba, N.Y. Times (Oct. 6, 2015).

[3] Dep’t of Homeland Security, Readout of Deputy Secretary Mayorkas’ Trip to Cuba (Oct. 30, 2015).

[4] Markon, ‘I went with a nervous heart’: Top Cuban American DHS official makes emotional return to Cuba, Wash. Post (Nov. 4, 2015).

[5] Assoc. Press, US Companies in Cuba for Week-Long Celebration of Commerce, N.Y. Times (Nov. 3, 2015); Reuters, Cuba Signs Deal with Sprint, Says It Is Open for More Business, N.Y. Times (Nov. 2, 2015).

[6] Schmidt & Davis, U.S. and Cuba in Trade Talks, for Ballplayers to Be Named Later, N.Y. Times (Oct. 31, 2015).

Published by

dwkcommentaries

As a retired lawyer and adjunct law professor, Duane W. Krohnke has developed strong interests in U.S. and international law, politics and history. He also is a Christian and an active member of Minneapolis’ Westminster Presbyterian Church. His blog draws from these and other interests. He delights in the writing freedom of blogging that does not follow a preordained logical structure. The ex post facto logical organization of the posts and comments is set forth in the continually being revised “List of Posts and Comments–Topical” in the Pages section on the right side of the blog.

5 thoughts on “Developments in U.S.-Cuba Normalization”

  1. Comment: Next Meeting of U.S.-Cuba Bilateral Commission

    On November 10 the second meeting of the U.S.-Cuba Bilateral Commission will take place in Washington, D.C.

    To be reviewed are the agenda of topics established during the first meeting, held September 11, 2015, in Havana; results achieved over the intervening months; and the complex issues between the two countries which are pending solution, including the lifting of the blockade. The Commission also will define the next steps to be taken, such as possible mutually beneficial agreements, technical meetings on areas of common interest, exchanges on issues of bilateral and multilateral interest, and high level visits.

    1. Comment: U.S. and Cuba Held Law-Enforcement Dialogue

      On November 9 in Washington, D.C. the U.S. and Cuba held dialogue regarding law enforcement issues.
      The meeting took place in a respectful and productive environment and reinforced the benefits of law enforcement cooperation to both countries. The discussion focused on a wide range of areas of cooperation in law enforcement, including counter-terrorism, counter-narcotics, transnational crime, cyber-crime, secure travel and trade, and fugitives.
      Both parties agreed to continue the dialogue and to pursue deeper bilateral cooperation via technical meetings throughout the first half of 2016.
      ==============================================
      U.S. State Dep’t, United States and Cuba Hold Law Enforcement Dialogue in Washington, D.C. (Nov. 9, 2015), http://www.state.gov/r/pa/prs/ps/2015/11/249352.htm.

  2. Slow pace of normalization is due to US Administration stalling on ending regulations that penalize Cuba for using US dollars in business transactions, penalizing banks that handle transactions with Cuba in dollars or any currancy, obstructing the granting of credits, loans and other financial services by companies and US banks with Cuba, authorizing the direct exportation of US goods to Cuba, removing limit on products that US companies can import from Cuba, allowing Cuban planes, ships to transport tourists, cargo and mail between bot countries, authorize American companies to invest in Cuba, reversing the policy of financial prosecution of Cuba, permit the sales of products of third counties that have more than 10% US parts and to not obstruct the granting of credits or other financial transactions for US exports to Cuba. All these steps the Administration has legal authority to take with out Congress voting on it or approving it. Since Obama’s term is winding down soon it is important for him to act. Congress in it’s present form will not be addressing the bills on Cuba before it in 2016.
    Cuba is not going to be threatened and coerced into changing it’s laws or political system to suit the government or corporations of the US. It won that battle in 1959.
    It is up to the democratic and just will of the American people to change the unilateral imposition of the US blockade on Cuba and restore the rights of it’s companies to trade and the right of it’s citizens to travel.

    1. As my 11/11/15 post indicates, I agree that U.Sa. restrictions on use of U.S. Dollar are impeding some business transactions with Cuba and that this is due, at least in part, because of U.S. banks’ fear of fines and of implementation of new regulations.In part this is to be expected with adapting to major changes of any kind. The Cuban government has asserted that the Obama Administration has additional executive authority to adopt additional regulations to loosen restrictions on transactions with Cuba, but Cuba has not set forth a legal opinion supporting such a contention. Although I am a retired attorney, I have not attempted to dig into this complicated area of law and thus do not know whether the Cuban assertion is justified or not, and Mr. Klave is not an attorney. I have seen news reports that the U.S. Administration is considering additional regulations, and I hope that it does so. I agree that the U.S. Congress should pass legislation ending the U.S. embargo of Cuba.

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