Business believes US embargo on Cuba to crumble

The Hill

By: Megan R. Wilson and Vicki Needham

U.S. businesses and other advocates are increasingly optimistic that the last trade barriers with Cuba are crumbling.

President Obama’s decision to reopen diplomatic relations with Cuba has triggered a chain reaction that is bringing the two nations in close contact for the first time in nearly six decades. 

 

With the president set to make a historic trip to Cuba in less than two weeks — the first by a U.S. leader in nearly 90 years — some say it’s only a matter of time before the decades-old trade embargo on the island nation is lifted. 

“It’s only a minuscule portion of Congress that actually don’t believe the sanctions should be lifted,” said Jodi Bond, vice president of the Americas for the international division at the U.S. Chamber of Commerce.

Obama stunned Washington 15 months ago by announcing a historic diplomatic rapprochement with Cuba.

The foreign policy shift — one of the most consequential of Obama’s tenure — resulted in eased restrictions on travel, banking and trade, and the reopening of the U.S. Embassy in Cuba.

Lobbyists sprang into action after the Cuban thaw was announced. The number of groups and firms that reported lobbying on Cuba more than tripled in 2015, rising to an estimated 97 from 31 the previous year, according to an analysis by The Hill. 

“We’re focused on moving the ball incrementally, finding openings as we go and using the president’s trip as momentum and leverage to open dialogue and economic opportunities for both countries,” said Scott Parven, the head of the Cuba policy initiative at Akin Gump Strauss Hauer & Feld, which the firm formed last year.

“History will look back on this trip as pivotal in this relationship and in accelerating the pace at which the embargo is fully lifted,” he said.

A wide-ranging group of companies and trade associations appears to have an interest in Cuba and its untapped business markets.

The entities that have reported lobbying on Cuba include Verizon, the U.S. Chamber of Commerce, Major League Baseball, the Electronic Transactions Association, Chevron, Carnival Cruise Line, Amnesty International, Marriott, the National Fraternal Order of Police, and Network, a Catholic advocacy group supportive of the normalization efforts.

Ahead of Obama’s visit to Cuba on March 20, the White House is expected to take more steps to ease travel and trade restrictions. 

Cuba is sending mixed signals, however. The island government has accused the U.S. of meddling in its affairs, publishing a 3,000-word editorial in Communist Party newspapers outlining a list of grievances. 

Even with Obama’s actions, significant barriers to trade and commerce still exist between the U.S. and Cuba that can only be lifted by Congress.

Several members of Congress — including Sen. Marco Rubio (R-Fla.), Sen. Ted Cruz (R-Texas), Sen. Bob Menendez (D-N.J.) and Rep. Ileana Ros-Lehtinen (R-Fla.) — remain staunchly opposed to lifting the Cuban trade embargo.

“It is totally unacceptable for the president of the United States to reward a dictatorial regime with a historic visit when human rights abuses endure and democracy continues to be shunned,” Menendez said last month after the trip was announced. 

But the tide, even among Republicans, appears to be turning toward ending the trade restrictions, though GOP leaders are not yet on board.

Sen. Bob Corker (R-Tenn.), chairman of the Senate Foreign Relations Committee, last month said he could see the Cuban sanctions ending as early as 2017, when a new president moves into the Oval Office. 

“If Cuba were to evolve its behavior and people were able to see results from what’s happening with the executive order changes that are occurring, then I think it’s possible,” Corker said.

Some advocates say Washington’s stance toward Cuba has changed much faster than they expected.

“The inevitability question has moved rapidly,” said James Williams, president of the Engage Cuba coalition. 

He said that with the exception of hard-liner lawmakers, most “know the train is moving ... [and] they’re all positioning themselves to say, how do they get to ‘yes’ in a way that maintains the principles they hold.”

Engage Cuba — a coalition of companies, industry groups and think tanks — officially formed last year after Williams laid the groundwork by waging a multimillion-dollar advocacy campaign to bring the Obama administration’s policy changes to fruition.

The group also established the New Cuba PAC to dole out money to lawmakers supportive of enacting more policy changes and lifting the embargo, which Williams says will be an essential part of the strategy for getting Congress to act. 

“This is not a fall-on-your-sword, let’s-take-on-the-establishment kind of thing,” he said. “The main battle is over. We just haven’t dealt the final blow.”

Williams said his group exists “to show the Cuban-American community wanted this, the business community wanted this and the military and national security community thought it made sense — and then be the squeaky wheel.” 

For some groups, including the Chamber of Commerce, restoring trade relations with Cuba has been a long time coming.

Chamber President Tom Donohue met with Fidel Castro in 1996 to investigate whether economic reforms were underway. But it took 17 years for a return trip.

The powerful business lobby established the U.S.-Cuba Business Council last year and saw a rush of businesses eager to join. 

Other groups lobbying on Cuba, like the National Fraternal Order of Police, are working on specific aspects on the path toward normalizing relations. 

The law enforcement group is arguing that the administration should work with Cuban officials to extradite U.S. criminals convicted of killing police officers. There are at least two that have been granted political asylum in the country: Charlie Hill and Joanne Chesimard, also known as Assata Shakur.

“It seems to be, just as a matter of fact, that these trade restrictions are a huge hammer over their head — and once you take it away, the most significant tool you’ve got is gone,” said Jim Pasco, the executive director of the organization. “There will probably never be a more opportune time than now to get these two back into custody.”

Travel to and from Cuba is another issue looming over an entire business sector.

While travel to Cuba is now permitted in 12 categories, including for business and family, sanctions still prohibit travel for leisure or tourism.

American and other airlines have filed applications with the Transportation Department to provide regularly scheduled service to Cuba’s airports. 

Dallas-based American Airlines argues regular flights would help cement the U.S.-Cuba relationship.

“Without air service, all of the ideas and objectives of President Obama are hard to fulfill,” said Howard Kass, vice president of regulatory affairs for American Airlines, which has offered charter service to the island for the past 25 years. 

“Air service is a huge step forward,” Kass said. “I’ve been saying all along that air service enables so much to happen.”