Why There’s Big Potential for US-Cuba Trade in This Sector

Why There’s Big Potential for US-Cuba Trade in This Sector

By the Cuba Journal staff

As relations between the United States and Cuba continue to show signs of improvement, the U.S. Department of Agriculture has issued a report expressing the potential for mutually beneficial agricultural trade and resultant economic growth.

The report points to the benefits of the resumption of normalized economic relations with Cuba, including “the potential to generate further growth in U.S.-Cuba trade; to foster greater productivity in the Cuban economy; to increase demand for agricultural imports among Cuban consumers, foodservice providers, and food manufacturers; and to allow for the resumption of U.S. agricultural imports from Cuba.”

The two country engaged in high levels of agricultural trade prior to the Cuban Revolution, which experts believe suggests potential for the future of U.S.-Cuba commerce.

In 2000, after decades of strict embargo, the U.S. signed the Trade Sanctions Reform and Export Enhancement Act, which authorized the export of certain food and medicines to Cuba, but remain prohibitive of imports.

President Obama’s December announcement about policy changes with regard to Cuba represent further action progressing to normal trade relations between the countries.

The USDA report suggests that the removal of financing and travel restrictions opens the potential for considerable economic growth – citing models that estimated that, with the absence of the restrictions, U.S. agricultural exports would have increased from $321 million to $500 million in 2006.

The USDA outlines a series of elements that would be necessary to facilitate such growth, starting with the reestablishment of diplomatic relations with Cuba.

Other measures include the relaxation of travel restrictions, further exemptions to the embargo on U.S. exports to Cuba, policy changes to facilitate authorized transactions, providing internet access to more of the Cuban population, and the update of the application of U.S. sanctions on Cuba in third countries.

The report says in its conclusion, “Over the next 15 years, the challenge will be to provide more balances opportunities for U.S.-Cuba agricultural trade and to continue to build U.S. and Cuban confidence in the emerging commercial relationship.

Why There’s Big Potential for US-Cuba Trade in This Sector was last modified: November 29th, 2016 by Cuba Journal

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