Time to end agricultural trade restrictions with Cuba

By: Paul Johnson and Arturo Lopez-Levy
From: http://thehill.com/blogs/pundits-blog/energy-environment/341148-time-to-end-agricultural-trade-restrictions-with-cuba#.WWKM0ILNqPc.facebook

It has been nearly 17 years since Congress passed a law involving
Cuba. The last time was in 2000 when the Trade Sanctions Reform and
Export Enhancement Act allowed food products to be sold to Cuba on a
cash only basis as an exception to the comprehensive embargo.

The act opened a decade and a half of hope and sales but today, it is
anachronistic. Its prohibition of credit hinders further U.S.
agricultural exports to Cuba. After some important reforms of Cuba's
economy, there is a need for new legislation allowing U.S. agriculture
a chance to compete with other nations who have been trading with Cuba
for decades.

Cuba imports 74 percent of its food while local production is enough
to cover only 20 percent of the population needs. Poor infrastructure,
energy shortages, insufficient irrigation, severe post-harvest food
loss and a woefully inefficient distribution system hinder Cubans'
access to a dependable food supply.

There are other stresses as well. Tourism brought more than four
million visitors to the island last year. While good for the overall
economy, those tourists imposed a tremendous increase in food and food
quality demand for an island with a population of only 11 million
inhabitants and a poor agricultural structure.

That additional demand drove up the cost of food, making it less
available to the estimated 80 percent of the population who do not
have access to private jobs or remittances from abroad. It is
estimated that 88 percent of a Cuban household income is spent on
food, compared to only 10 percent in the U.S.

In short, Cuba has a food problem. Fortunately, the United States can
contribute some solutions — if we are permitted to use them.

The relationship between the U.S. and Cuba over the past fifty years
has been an acrimonious political one. Politics has trumped commerce
and created an environment where trade is unnecessarily complicated.
For far too long, U.S. commercial interests have been forbidden to
leverage their inherent economic and geographic advantages to pursue
trade with Cuba, to the severe detriment of businesses, producers and
consumers in both countries. What is needed is a move towards a
commercial relationship where trust and confidence can be restored.

Meanwhile, Russia, China and European countries — thousands of miles
away — have been sending cargo ships of food and agricultural products
to Cuba, goods that easily could have been purchased right next door
from U.S. companies and producers.

It's clearly time for the United States to normalize agricultural
trade with Cuba. Both countries have much to gain by passing a law
permitting further It's time for U.S. and Cuba agriculture
collaboration, so we must end restrictions on routine activities of
agricultural financial services that do not serve the interests of
either the U.S. or Cuban people.

President Trump's "America first" motto cannot ignore the interests of
farmers who helped elect him, and while a recent executive order made
clear that agriculture trade with Cuba was exempt from further
restrictions, it will require Congress to support that overture.

While ending restrictions on credit and financial services for sales
will increase the American share of the $2 billion in agriculture
products purchased by Cuba annually, Congress should also permit Cuban
exports to the United States.

Currently, the embargo severely limits Cuba from shipping exports
directly to the United States.

Dropping that restriction would benefit U.S. consumers as well as
Cuban exporters. Under normalized trade relations, U.S. consumers once
again would gain access to nearby Cuban products —such as tropical
fruits, seafood, coffee and tobacco — which we currently import in
large quantities from other countries at a higher cost.

The time has come for Congress to pass a law that will open up a new
market for our farm products, while helping to build a relationship
with Cuba literally from the ground up.

-----------

Paul Johnson is the president of Chicago Foods International, which
focuses on focus on developing equity projects and managing operations
that improve food and agriculture production, supply chains, trade,
and the sustainability of our shared natural resources.

Arturo Lopez-Levy, PhD is a lecturer at the Political Science
Department of the University of Texas, Rio Grande Valley. He is the
co-author of "Raul Castro and the New Cuba: A close-up view of
Change."