U.S. Imposes New Sanctions on Cuba and Denounces Cuba’s Detention of Dissident   

On October 18, the U.S. Department of Commerce’s Bureau of Industry and Security (BIS) imposed new sanctions against Cuba while the State Department denounced Cuba’s detention of dissident Jose Daniel Ferrer.

New Sanctions[1]

The BIS revoked “existing licenses for aircraft leases to Cuban state-owned airlines, and will deny future applications for aircraft leases.” This was based upon the Department’s assertion that  “the Cuban regime is resorting to transporting tourists on leased aircraft subject to BIS jurisdiction.”

Additionally, “BIS is expanding Cuba sanctions to include more foreign goods containing U.S. content, and is imposing additional restrictions on exports to the Cuban regime.” According to a regulation set for October 21 publication, the Export Administration Regulations will be amended so that goods with as little as 10% U.S. content will be subject to U.S. jurisdiction and, thus, require a license from the U.S. Department of Commerce for export or reexport to Cuba. Previously, the policy only applied to goods with 25% or greater U.S. content. In addition, the amendment will, prohibit certain donations to the Cuban government and communist party  and clarify the scope of telecommunications items that the Cuban government may receive without a license.

This action, says the Department, “supports the Administration’s earlier decision to hold the Cuban regime accountable for repressing its own people as well as continuing to provide support to the illegitimate Maduro regime which has terrorized the Venezuelan population and wantonly destroyed the once-prosperous economy relied on by millions.”

The Department’s Secretary, Wilbur Ross, said, “This action . . . sends another clear message to the Cuban regime – that they must immediately cease their destructive behavior at home and abroad. The Trump Administration will continue to act against the Cuban regime for its misdeeds, while continuing to support the Cuban people and their aspirations for freedom and prosperity.”

Cuba’s President Miguel Diaz-Canel in a tweet said these new sanctions were “an expression of impotence, moral degradation and imperial contempt. It is an inhuman, cruel, unjust and genocidal act that we strongly reject. We will not give up. and we will give sovereign answer.”

A similar tweet came from Cuba Foreign Minister Bruno Rodriguez: these are “additional acts of economic blockade, representative of a moral bankruptcy policy, internationally isolated and promoted by a corrupt government. The Cuban people will continue to give due and sovereign response.”

Denouncing Cuban Detention of Dissident[2]

The Cuban dissident who has been detained is Jose Daniel Ferrer, the founder of  the Patriotic Union of Cuba (UNPACU).

According to the State Department, “On October 1, “Castro regime officials detained Mr. Ferrer and several other human rights defenders in Santiago de Cuba.  Mr. Ferrer reportedly has still not been informed of any charges against him, and has been denied access to a lawyer and to medical care.  Mr. Ferrer’s family has not been permitted contact with him since October 4.”  In addition, other “UNPACU activists Roilan Zarraga Ferrer, José Pupo Chaveco, and Fernando González Vailant also remain in custody.”

“Ferrer’s case is one more example of the Castro regime’s continuous and flagrant violation of human rights, which has recently escalated into a wave of repression against freedoms of speech, expression, and religion.  The United States will not allow these abuses against the Cuban people to go unnoticed or unanswered.  We will continue to increase sanctions and trade restrictions to diminish the resources available to the Cuban regime, which uses its income to suppress its own citizens and to prop up other regimes with shameful human rights records, including the former Maduro regime in Venezuela.”

Therefore, the U.S. “strongly condemns the Cuban regime’s unconscionable detainment of . . . [Senor] Ferrer, founder of the Patriotic Union of Cuba (UNPACU).  We call on the Castro regime to immediately disclose Mr. Ferrer’s location and condition, to treat him humanely, and to release him from detention without condition.”

Similar protests of this detention have been registered by UNPACU, Cuba’s Legal Information Center (CUBALEX), Cuban Prisoners Defenders, Freedom House and Amnesty International.

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[1] Commerce Dep’t, U.S. Department of Commerce Further Tightens Cuba Sanctions (Oct. 18, 2019); Reuters, U.S. Hits Cuba With New Sanctions Over Human Rights, Venezuela, N.Y. Times (Oct. 18, 2019); Assoc. Press, U.S. slaps new sanctions on Cuba over human rights, Venezuela, Wash. Post (Oct. 18, 2019);Center for Democracy in Americas,  U.S. restricts additional exports and re-exports to Cuba, U.S.-Cuba News Brief: 10/18/2019.

[2] State Dep’t, Detention of Cuban Human Rights Defender José Daniel Ferrer (Oct. 18, 2019); The arrest of José Daniel Ferrer is ‘a mechanism of repression against all civil society,’ Diario de Cuba (Oct. 17, 2019); Cuban Prisoners Defenders denounces the Cuban regime in Geneva for the case of José Ferrer, Diario de Cuba (Oct. 17, 2019).

 

Cuba’s Increasing Cooperation with Russia   

A recent blog post commented on the increasing connections between Cuba and the European Union, one of the consequences of the Trump Administration’s hostile rhetoric and policies about the island nation. Another unfortunate consequence of this U.S. hostility is the increasing cooperation between Cuba and Russia.[1]

Last week, for example, Vice President of the Cuban Council of Ministers Ricardo Cabrisas Ruiz, led a Cuban delegation for meetings in Moscow. This included the X Meeting of the Russia-Cuba Business Committee, the first National Exhibition of Cuba in Russia and the XVII meeting of the Russian-Cuban Intergovernmental Commission.

At the Commission meeting Cabrisas said, “I call on continuing to work to strengthen the bonds of friendship and solidarity between the two peoples and governments, to make our economic, commercial and financial relations of cooperation more efficient.” He also complained that U.S. sanctions, together with the effects of climate change, have caused losses to the Cuban economy in the last decade “for almost 22 billion U.S. dollars” and that this damage “has affected [Cuba’s] financial situation and caused some delays in our payments. ” However, he stressed that Cuba is resolving this situation “gradually” and that it has “the will and the decision to fulfill each of our obligations to the Russian Federation.” Moreover, Cuba is satisfied “with the effective participation of the Russian Federation in Cuba’s economic-social development plan until 2030.”

Russian Deputy Prime Minister Yuri Borisov, meanwhile, presented as “good news that the volume of trade between Russia and Cuba could reach 500 million dollars by the end of this year.” Last year, he added, “the volume of Russian-Cuban trade grew by 34%.” With respect to Cuba’s current fuel crisis, Borisov said that the two countries had just signed a plan to modernize the Cuban energy system, which will allow Cuba to reduce oil supplies from abroad by a third and save 1.8 billion dollars. This was the result of the efforts of last January’s creation of a working group to implement projects aimed at modernizing Cuba’s energy sector with the help of Russian companies.

Russia also is interested in resuming agricultural cooperation with Cuba and raising it to the levels achieved during the Soviet era, according to the director general of the Russian National Committee for Economic Cooperation with Latin American Countries (CN CEPLA), Tatiana Mashkova. She also referred to possible bartering and the use of the ruble in commercial transactions. The vice president for the Russian side of the Cuba-Russia business committee also recalled that in those years the Soviets supplied irrigation machinery and all kinds of harvesters to Cuba.

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[1] Havana clings to Moscow as a ‘piece fundamental to solve the current crisis,’ Diario de Cuba (Sept. 21, 2019)    See also these posts to dwkcommentaries: Professor LeoGrande’s Comments on the Strengthening Cuba-Russian Relationship (Jan. 3, 2018); Trump’s Hostility Towards Cuba Provides Opportunities for Russia (Dec. 19, 2017).

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Trump’s New Regulations Adversely Affect Cuban Entrepreneurs

The new travel regulations and anti-Cuba rhetoric of President Trump already are hurting ordinary Cubans, especially those who have become entrepreneurs and who employ 600,000 of the island’s 11 million people.  The “self-employed” sector, a euphemism used by the Cuban government to avoid the words “private” or “entrepreneur,” already is encumbered by Cuban regulations that leave little room for development.[1]

Now an “association of Cuban businesswomen has asked to meet with Senator Marco Rubio (Rep., FL), a Cuban-American who has never been to the island and who is believed to be a major influencer on the Trump Administration’s Cuba policies. These women want to explain ” the impact on the country’s nascent private sector of rolling back a detente in U.S. relations.” They say, “The current situation has us very worried and we would like to share our personal histories and perspective from Cuba.”

One of these women, Niuris Higueras, the owner of the Atelier restaurant in Havana, said her  “business is down 60 percent from a year ago.” Another woman, Julia de la Rosa, who runs a 10-room bed and breakfast, said rentals were down 20 percent in October and she expected a further decline as new U.S. regulations on individual travel kick in this month.

The Trump Administration’s evident hostility toward Cuba also has caused U.S. businesses to reduce their interest in trying to create and build business in Cuba. At this year’s Cuba trade fair only 13 U.S. companies had booths compared with 33 last year. Another cause of this reduction is growing awareness of the difficulty of doing business in Cuba.[2]

Former U.S. Secretary of Commerce Carlos Gutierrez, the Cuban-born head of the U.S.-Cuba Business Council, said, “This is a huge step backwards. We had made so much progress.”

U.S. airlines with licenses for flights to Cuba also are seeing the reduction in U.S. demand for visiting Cuba. As a result, five airlines have cancelled all flights to the island while others have reduced the number of their flights.[3]

A caveat to this negative reaction is the opinion of some that the new regulations on business dealings “produce brighter lines that may make it easier for companies to identify who exactly they can do business with when trying to operate on the island.”

One who expressed this view is Peter Harrell, an adjunct senior fellow at the Center for a New American Security who previously served as a deputy assistant secretary for counter-threat finance and sanctions in the U.S. State Department, said that the new regulations “made trade easier with the country’s private sector.” A significant point in this regard was the State Department’s FAQ document stating that “entities not on its restricted list, even if they’re subsidiaries of those on the list, are [not] restricted until they themselves appear on the blacklist.”[4]

Another caveat is “the new regulations limiting “disruption to pre-existing commercial activities, ensuring that U.S. companies can continue to do business with Cuba’s nascent private sector.” Examples of such preexisting deals are Deere & Co. and Caterpillar Inc.’s arrangements for distribution of their products on the island.[5]

Myron Brilliant, the head of international affairs at the U.S. chamber of Commerce, urged the administration “to continue to keep business in mind and avoid further steps to restrict the economic relationship between the U.S. and Cuba.”

Nevertheless, the U.S. regime of Cuba sanctions presents risks to U.S. companies. The latest example is the November 17 announcement by the U.S. Treasury of an OFAC settlement with American Express Co. for $204,000 for its 50%-owned Belgian credit-card issuer’s corporate customers’ 1,818 transactions in Cuba between 2009 and 2014.[6]

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[1] Reuters, Cuban Businesswomen Seek Rubio Meeting as U.S. Policies Bite, N.Y. Times (Nov. 17, 2017). The above topics and others are the subjects of earlier posts listed in the “Cuban Economy” section of List of Posts to dwkcommentaries—Topical: CUBA.

[2] Reuters, Blooming U.S. Business Interest in Cuba Wilts Under Trump, N.Y. Times (Nov. 10, 2017).

[3] Reuters, Alaska Airline Discontinues Los Angeles-Havana Daily Flight, N.Y. Times (Nov. 14, 2017); Assoc. Press, Alaska Airlines to Halt Flights to Cuba, N.Y. Times (Nov. 14, 2017).

[4] Rubenfeld, New U.S. Cuba Regulations May Make Compliance There Easier, W.S.J. (Nov. 9, 2017).

[5] Schwartz & Radnofsky, New Trump Rules Pare Back Obama’s Opening to Cuba, W.S.J. (Nov. 8, 2017).

[6] Rubenfeld, American Express Unit Fined Over Cuba Sanctions Violations, W.S>J. (Nov. 17, 2017).