As ever, Cuba is in the midst of change and so are the resulting commercial opportunities. I see these across the business canvas as the new Chairman of the UK’s trading partnership, The Cuba Initiative.
First, the visit of new President Diaz-Canel to the UK made it possible to understand the priorities for his economy and talk honestly about the constraints. Alongside the need for hard currency earning businesses in leisure, the key issue is food security. Shortages of basic foodstuffs – oil, flour, milk powder, chicken and pork were all discussed. The impact of the blockade effects food security as does the breakdown of machinery and processors. The visit encouraged full discussion of those challenges at the very top of government.
Second, the first ever visit by senior British royals, HRH Prince Charles and the Duchess of Cornwall, to Cuba since it came under communist rule underlined the importance of the growing relationship between the two countries. The success of the visit on 24th– 27th March 2019 is already clear, not least in the warmth of the mood music, it also demonstrated the UK’s and EU’s distance from US policies of additional hostility. In one sense it is hardly political to foster engagement across the whole range of subjects stretching from economic links to human rights.
There was a risk of the Royals visiting during this timing, of course, created by deteriorating conditions in Venezuela and open differences in UK and Cuban approaches. But differences are unlikely to be bridged without dialogue and that has long been the benchmark of Prince Charles’ approach.
Third, the US is in the process of lifting the waiver on Title III of Helms-Burton which would tighten the embargo increasing the likelihood of legal actions by Cuban Americans against anyone in economic relationships with Cuban entities using facilities the Cuban Americans say were expropriated. A raft of high cost legal cases are possible especially in the Florida courts where extraterritorial penalties could be awarded.
To make matters potentially worse, John Bolton, President Trump’s National Security Advisor, is contemplating the triggering of Title IV which would stop executives of companies alleged to be involved in businesses covered by Title III from entering the US. Quite aside from the loose wording of Helms-Burton, likely to release a torrent of expensive legal argument, a unilateral approach by the US has already raised the significant probability of UK and EU countermeasures whether or not the UK remains in the EU institution.
The result is likely to be forms of retaliation by the EU and UK in which Spain is taking prominent role. The UK is closely aligned. The EU has stated it has met all its earlier agreements with the US on Helms-Burton and it is the US setting the agreements aside. The UK had argued the stops are in any case wholly counter-productive. The retaliatory measures would include taking counter measures in European courts to recover all sums awarded by US courts plus legal costs.
And, they may very well include banning from the EU and UK of anyone who takes Helms-Burton legal actions in the US. These are all mirror arrangements and it is to be hoped that sitting them out would encourage the US not to propel relationships along such a negative path. At Salamanca Group we continue to believe in the efficacy of the trade given its record of healing old divisions and its creation of mutual benefit.
Lord David Triesman has over 40 years’ experience working with Cuban leaders and their Ambassadors in London, strengthened relationships when responsible for Anglo-Cuban relations as a Foreign Office Minister in the mid-2000s and deepened these with time. The development of such a trusted relationship with partners in-country, aided by a long term vision and presence, has allowed Salamanca Group to be part of the opening of Cuba to foreign investment.
Lord David Triesman is leading this initiative and has developed a blog to provide an assessment of progress and opportunity as we create, together with the Cubans, a new financial hub.