President Trump’s June 16 Cuba policy announcement pledges a “much better deal for the Cuban people and the USA.” Two premises of that new policy –promoting Cuba’s private business class and trading humanitarian agriculture goods – are as complementary as they are compelling. With a new generation of Cuban leaders poised to assume control in less than five months, there is no better way for the Trump administration to start guiding Cuba towards a mutually advantageous relationship than by expanding two-way agricultural trade.
America’s distressed rural economy and Cuba’s growing number of entrepreneurs have much to gain from increased trade opportunities. At the heart of this potential lies the reality that Cuba must import 80 percent of its food needs to feed its 11 million people, a problem that has only been exacerbated by the damage done to crops by Hurricane Irma. The U.S. can already sell agriculture goods to the island, but a cash requirement restriction prevents trade on a meaningful scale. With the advantage of geographical proximity, American farmers should already be supplying $1.4 billion of Cuba’s $2 billion agricultural import needs, and the only thing stopping them is a US law preventing Americans from selling on private credit what they can already sell in cash.
Unfortunately, Cuba now imports much of its rice, corn, poultry, soy and other agribusiness needs from our competitors in distant parts of the globe. The island meets its annual rice needs, for example, by importing rice from Vietnam, which takes 36 days to arrive in Cuban ports, when it could be importing rice in 36 hours from Arkansas, Texas, or Louisiana. By taking steps, even incremental ones, to improve U.S. access to Cuba’s agricultural market, the administration could help boost sagging U.S. farm prices, grow export revenue, and create desperately needed jobs in rural America.
Beyond American farmers selling to Cuba, expanded two-way agricultural trade would also advance the interests of the Cuban people and private businesses. Cuba’s private farmers, over half a million in number, form the backbone of its growing entrepreneurial class. When I traveled to Cuba last year, I visited an agricultural market and saw for myself a group of sellers beginning to learn the dynamics of a market place.
A third of Cuban farmland is now worked by private farmers, who represent the largest group of private landowners on the island, holding title to over 6.5 million acres of high quality land. Most of these farmers produce products that don’t compete with American farmers– products like bananas, coffee, tobacco and others. In the case of tobacco, the country’s most important agricultural product, private farmers are responsible for nearly all of that production.
Yet Cuban farmers are still impoverished by U.S. standards, earning on average less than $100 per month and unable to afford modern farm equipment. If Cuban agricultural products could be exported freely to the United States in a two-way agricultural trade relationship, private Cuban farmers could earn the income needed to buy modern U.S. farm equipment and other agribusiness needs, improve productivity and lift their overall standard of living.
With Cuban President Raul Castro set to retire in February 2018, the time is right for Congress and the administration to make small changes to our current trade relationship by encouraging bilateral agribusiness trade. The Cuba Agricultural Exports Act, which eliminates the ban on American agricultural export financing, already enjoys strong bipartisan support in Congress and should be passed. But legislation and regulatory changes promoting limited bilateral trade could also effect the change President Trump wants to see in Cuba. In fact, he already has authority under existing regulations to permit U.S. imports of Cuban goods produced by Cuban entrepreneurs.
Whatever the avenues, we can’t miss this opportunity to create jobs in rural America while at the same time encouraging private land ownership and free markets on the island nation. Measures taken now to build a stable, mutually beneficial US-Cuba trading relationship in agriculture will go a long way towards increasing American influence with Cuba’s new generation of leaders, restoring prosperity for American farmers, and helping ordinary Cubans shape their country’s future.
Crawford represents Arkansas's 1st District. He is a member of the Agriculture Committee and chairman of the Subcommittee on General Farm Commodities and Risk Management.