By: Mike Copeland
Leaders in business and agriculture, including the Waco-based Texas Farm Bureau, have joined forces to create the Engage Cuba Texas State Council, which will push to have travel and trade restrictions abolished between the United States and the island country 90 miles from Florida.
The goal is to give farmers and manufacturers a multibillion-dollar economic nudge by permitting the sale of products to Cuba.
“Texas is a leading economic driver for the U.S. economy, and opening up trade with Cuba would provide tremendous opportunities for businesses across the state. However, Texans are stuck on the sidelines as our foreign competitors continue to take advantage of Cuba’s growing markets,” Engage Cuba President James Williams said in a statement on the council’s creation last week.
It will include 43 people representing a cross section of advocacy groups, industry and academia.
“We are very pleased to have a diverse list of dynamic and engaged Texans willing to step up and call on Congress to lift the embargo that is costing Texas jobs and preventing economic development for the Cuban people,” Williams said in the statement. “It’s time to end 50 years of failed isolationist policy toward Cuba.”
Creation of the council comes in the wake of President Barack Obama’s trip to Cuba in March and meetings with President Raul Castro, which represented the first official contact between the countries in more than a half-century.
Obama announced in January the United States would be easing some restrictions on commerce with Cuba and would allow the financing of authorized exports to the country. The authority to formally lift the trade embargo rests with Congress.
Caterpillar, the Illinois-based heavy equipment giant that has invested tens of millions of dollars on manufacturing and warehouse facilities in Greater Waco, already has signed a deal with a distributor, Rimco, of Puerto Rico, to ship products to Cuba if lawmakers remove the trade restrictions.
Cuba depends heavily on agricultural imports, which average $2 billion annually, “and this number will continue to grow given the increasing purchasing power of 11 million Cubans,” said Jenifer Sarver, a spokeswoman for the Engage Cuba Texas State Council.
“There is also an immediate need for infrastructure improvements to meet the rising demand of foreign travelers. Texas is well-positioned to help meet these and other needs on the island.”
In other states
In addition to Texas, Engage Cuba has begun state councils in Georgia, Iowa, Minnesota, Ohio, Tennessee, Arkansas and Louisiana.
Sarver, speaking by phone, said members of Congress look to their constituents for cues on how to vote, and Engage Cuba aims to stir up grass-roots support for normalizing relations and eliminating the embargo that began with the rise to power of Fidel Castro and his Communist regime.
“This embargo costs the United States $1.2 billion annually,” Sarver said.
Removing trade barriers “could mean big opportunities to agriculture in Texas, which produces rice, soybeans, beans and corn, which the Cuban people really need. As more people travel to Cuba, more food will be needed for visitors,” she said.
Cuba also could become the site of new manufacturing plants, Sarver said. She is not suggesting U.S.-based companies would relocate there, but that manufacturing facilities already serving U.S. clients from elsewhere in the world may consider a move to Cuba, she said.
“Cuba is within the Eastern Time Zone, so call centers and that sort of thing could more effectively operate there,” Sarver said.
Pushing for legislation
The Engage Cuba coalition is pushing for passage of three pieces of legislation, she said:
The Agricultural Export Expansion Act of 2015, which has six Texas co-sponsors, would allow American farmers to offer financing to Cuban importers to promote sales.
The Freedom to Travel to Cuba Act would expand Cuba’s already growing markets and provide additional opportunities for U.S. agribusiness to export to Cuba.
The Cuba Trade Act of 2015 would permit private-sector industries in the United States to export goods and services to Cuba. Sarver said the bill includes language to ensure U.S. taxpayers would not find themselves on the hook if Cuban borrowers default on lines of credit extended by U.S. banks and business.
“Agricultural exports contribute about 25 percent to the income of farmers and ranchers, so you can see the importance of foreign trade with other countries, including Cuba,” said Glen Jones, director of research and policy development for the Texas Farm Bureau and a member of the new Engage Cuba Texas State Council.
Waco-based economist Ray Perryman said he has not prepared a study on the economic impact of lifting the trade embargo against Cuba.
“Given the size of Cuba, it won’t be huge, but potentially very lucrative,” Perryman said in an email. “Cuba has demands for petroleum and petrochemical products, technology, machinery, food products, professional services and other major Texas exports.”