[Marxism] U.S. exporters hope Cuba trade policy changes soon

Walter Lippmann walterlx at earthlink.net
Tue Jun 24 21:40:23 MDT 2008

(It would seem unlikely that US policy toward Cuba might change
because the U.S. government decided that it should do the right thing
by Cuba and go ahead and normalized relations like everyone else.

(This is one of the many reasons that people from different walks of
life and with different motives who favor a more normal relationship
with Cuba are today supporting the candidacy of Barack Obama for
president of the United States. While he has, like most bourgeois
politicians, moved to the right as his campaign has progressed, so
far he has not as yet backtracked on his promise to allow unlimited
family travel and remittances for Cuban-Americans. While Obama says
he would keep the blockade, and there's no reason to disbelieve him
on that, the change in visitation and remittance limitations would
mark a substantial quantitative shift in U.S. policy, one which
should be viewed quite favorably, in my opinion.

(It seems that practical factors so basic as material self-interest
by the corporate business sector will most likely play a decisive
role, absent the rise of proletarian class consciousness, followed by
the establishment of a socialist government after a successful working
class-led socialist revolution in the United States of America.
Abstractly, a change along the second line would be preferable,
but it doesn't seem like an imminent probability in the short- to
medium-term. The author is director of a different CubaNews, one
which costs $425.00 per year for a sub, as compared to the totally
free Yahoo news group which Walter Lippmann - that's me - runs.)

U.S. exporters hope Cuba trade policy changes soon
By Larry Luxner


The Cuban government is spending more than ever on staple U.S. food imports, leaving
fewer dollars for importing fresh produce. “My industry is very interested in sales
to Cuba,” says Kevin Moffitt, president and chief executive officer of the Pear 
Bureau Northwest, Milwaukie, Ore.

(June 24, 3:30 p.m.) Cuba is spending more than ever on U.S. food imports — but 
that’s not because bilateral ties have improved or because Cuba’s new leadership
has suddenly acquired a taste for California cherries, Oregon pears or New York 
sweet corn.

Rather, it’s because the cash-strapped government of Raúl Castro, which is forced
to spend more on suddenly expensive staples like rice and wheat, has fewer dollars
left over for imported fresh produce.

“My industry is very interested in sales to Cuba,” said Kevin Moffitt, president
and chief executive officer of the Pear Bureau Northwest, Milwaukie, Ore. “People
say Cuba used to be a great market for pears in the 1950s, and there’s a specific
variety they really like, the comice pear, which is very sweet. We’re holding out
hopes that when this market opens up, we will once again have a good market for 
that variety.”

In September 2002, Moffitt attended a widely publicized U.S. food show in Havana
that attracted thousands of curious visitors including then-president Fidel Castro,
who even sampled a U.S. pear.

For awhile, Moffitt’s agency — which supervises $110 million a year in Oregon and
Washington pear exports — was shipping 6,000 boxes of pears annually to Cuba.

But after President Bush’s imposition of tough new U.S. restrictions on Cuba trade
in 2004, that began dropping, and last year the two states shipped only 2,500 boxes
to Cuba. That’s only one-tenth of what the neighboring Dominican Republic, a Caribbean
nation with far fewer people, buys from Oregon and Washington, which together account
for 93% of all U.S. pear exports.

However, the export picture could brighten dramatically if barriers to trade between
the two countries were removed even partially.

While Sen. John McCain, the presumptive Republican nominee for president, has vowed
to keep all Cuba-related sanctions in place, his Democratic rival, Sen. Barack Obama,
promises that, if elected, he would reinstate unlimited family travel and remittances
to Cuba and relax the bureaucracy associated with selling food to the island’s communist

“We could easily see 10,000 boxes in the short to medium term, and we have a lot
of potential even without the travel restrictions easing for U.S. citizens,” Moffitt
said. “Cuba’s tourist trade is still booming, and we could sell pears at those hotels.”

Last year, Cuba bought $437.6 million in agricultural goods from the U.S. under 
the Trade Sanctions and Reform Export Enhancement Act of 2000, up from $340.4 million
in 2006.

Fresh fruit exports

U.S. fresh fruit is a miniscule part of overall agriculture exports. According to
the U.S. Department of Agriculture’s Foreign Agricultural Service statistics, U.S.
fresh fruit exports to Cuba totaled $1.83 million in 2007, up from $1.1 million 
in 2006. Most of the 2007 shipments consisted of apples ($1.35 million), followed
by smaller amounts of grapes ($235,000) and pears ($71,000). Vegetable exports were

The U.S. Commerce Department reports that since passage of the act, essentially 
a loophole in the 1962 trade embargo against Cuba, that island’s purchases of U.S.
food and other agricultural commodities (including lumber and newsprint) have totaled
$2 billion.

Cuba’s numbers are substantially different. State food purchasing agency Alimport
says it bought $682 million worth of food items from U.S. companies in 2007 — up
from $570 million the year before — amounting to cumulative purchases of $2.79 billion.

The reason for the discrepancy: Alimport’s numbers include the cost of shipping 
as well as third-party financial charges incurred because Cuba can’t deal directly
with U.S. banks.

No matter whose numbers are used, it’s clear that fresh produce isn’t among the 
top items on Alimport’s shopping list.

“Alimport is using its limited resources and putting them where they are most critically
needed” — in a few large categories (like grains and frozen poultry) rather than
many small ones like fresh fruit and vegetables,” said Dave Kuntarich, vice president
of operations for PS International, a farm commodities broker in Chapel Hill, N.C.

“The problem is that with commodity prices so much higher than they were 12 months
ago, the quantity that can be purchased with those dollars is less,” Kuntarich said.

Limited funds aren’t the only challenge facing the new government of Raúl Castro,
who turned 77 in early June. The U.S. restrictions make it considerably more difficult
for U.S. food companies to export to Cuba under the trade sanctions act — even as
large states like Texas, New York and California send delegations to Havana trying
to drum up more business.

Among other things, the rules force Alimport to pay cash up front for any food purchases
before they can even be loaded onto a ship bound for Havana. They also make it very
difficult for Cuban phytosanitary officials to travel to the U.S. to conduct inspections
of produce prior to shipment.

Critics say that makes the U.S. an unreliable supplier to the Cuban market, despite
the advantage of proximity. The island nation is only 90 miles south of Key West,

“There’s a tremendous interest in Cuba for our products, but with all the restrictions,
it’s going to be hard to sell to them,” said Lloyd Zimmerman, owner and president
of Black Horse Farms, Coxsackie, N.Y. “For one thing, the Canadians are able to 
extend credit. We can’t. Secondly, because they have to prepay, there’s no inspection
of the produce until it arrives in Cuba. That’s hard on any deal in case something
happens along the way.”

In late April, Zimmerman, whose Hudson Valley vegetable farm covers 800 acres, traveled
to Cuba on a three-day trade mission with 18 other New Yorkers. Zimmerman said he’d
love to sell Alimport sweet corn, cabbage, squash, tomatoes and cucumbers during
the summer, when Cuba produces only 20% of its domestic needs for those crops.

“Other than (the September 2002) trade show, we haven’t really done anything,” said
Rebecca Baerveldt, international marketing manager at the Washington Apple Commission,
Wenatchee. “Until the trade sanctions are lifted, it’s very difficult for us as 
industry to invest money in that market because there’s not enough product going
down there to justify promotional activities.”

Allan Henderson said he considers himself one of the lucky ones. As president of
C.L. Henderson Produce Co., Hendersonville, N.C., he’s shipped, on average, nine
to 10 containers of apples a year to Cuba. At $15,000 per container, that comes 
to $135,000 to $150,000 worth of apple exports annually.

Henderson, who markets his fruit under the Henderson’s Best label, said he’s helping
put together a North Carolina trade delegation to visit Cuba this year with the 
hopes of scoring some major contracts with Alimport.

Whether such missions succeed depends in large part on what happens in both Havana
and Washington.

But Cynthia Thomas said things would be clearer for exporters if Obama gets elected.

In late May, Thomas, founder of the Texas-Cuba Trade Alliance in Dallas, helped 
organize her state’s first mission to Cuba since the 1959 revolution.

Although the Texas Department of Agriculture reported the visit resulted in two 
cotton contracts totaling $400,000, no produce agreements were signed and no fruit
and vegetable shippers took part in the 24-member delegation.

“If Obama wins, there’ll be a strong possibility of improved (U.S.-Cuba) relations
beginning in 2009,” said Thomas. “I think the whole package will be re-examined,
and the work that Congress does won’t get automatically vetoed. Right now, it’s 
not even worth expending energy to push any legislation through, because it won’t
go anywhere.”

Larry Luxner is editor and publisher of CubaNews, a monthly newsletter based in 
Bethesda, Md.


     Los Angeles, California
     Editor-in-Chief, CubaNews
     "Cuba - Un Paraíso bajo el bloqueo"

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