The troubling consequences of Washington’s new Cuba policy

David Jessop looks at the chances of success and the implications of Washington's new policy on Cuba.

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Just before Easter, the Trump Administration announced multiple new sanctions on Cuba. In doing so, senior US officials made clear that Washington was not just trying to break Havana’s close economic and political ties with Venezuela but intended the measures to bring about fundamental political change.

 

It is a position that stands in stark contrast to that of the EU, Canada, Mexico and most other nations worldwide that believe the only way to encourage change in Cuba is through dialogue, calibrated support and the exploration of the potential that generational change offers.

 

Speaking on April 17 to Bay of Pigs veterans in Miami, the US National Security Adviser, John  Bolton, could not have been clearer about US intentions. US policy in the Americas, he observed in a speech high on aggressive rhetoric against Cuba, now ends with the removal of communism and socialism from the hemisphere. “We proudly proclaim for all to hear: the Monroe Doctrine is alive and well” he declared in remarks that anticipated “the coming of the first free hemisphere in human history”.

 

The same day in significantly more measured terms, Mike Pompeo, the US Secretary of State, suggested that the sanctions were intended to advance “human rights and democracy on behalf of the Cuban people”.

 

Implications

The new measures allow as of May 2 US lawsuits against anyone including US companies ‘trafficking’ (making use of) expropriated US property in Cuba, by ceasing to waive Title III of its 1996 Helms Burton legislation. More potently, the State Department will now actively use Title IV of the bill to deny US visas to any foreign national who ‘traffics’ in confiscated property or who are corporate officers or shareholders of involved entities.

 

The Trump Administration also said that it will halt ‘u-turn’ financial transactions to Cuban entities made through US banks and will cap previously unlimited personal transfers to US$1,000 per quarter, a measure expected to drastically reduce the US$4bn a year ordinary Cubans receive in remittances largely from the US. In addition, Washington will impose new restrictions on non-family travel to Cuba in ways that are as yet unclear but likely to impair significantly all US travel to the island. It will also add additional Cuban enterprises and individuals to the State Department’s restricted list.

 

Other measures are also planned. Speaking after Mr Pompeo, the US Assistant Secretary for the Western Hemisphere, Kim Brier, said that the US is exploring further options and that the measures announced were just the beginning of a new process.

 

Although the detail has yet to be spelt out, an “on background” interview with two senior-level Trump Administration officials conducted by the US-Cuba Trade and Economic Council Inc provides several clues.

 

The business group, which works with US and other investors in Cuba, quoted its interlocutors as saying that while they did not expect sanctions to result in immediate political change in Cuba, one intended outcome would be to alter the structure of the Cuban economy by removing the subsidised oil exports the country receives from Venezuela. “That means permitting more of a market-based economy. They won’t like it, but their ability to derail (sanctions) is pretty fast moving beyond their control”, the official was reported as saying.

 

The same individuals also said that that a unique confluence of events now offers the US the opportunity to bring about change in Cuba. “For President Trump, the stars have aligned, and Venezuela is the tool that we believe can provide change within two countries” one of the officials was quoted on the organisation’s website as saying.

 

Cuba’s defence

How effective such an approach might be is unclear. Cuba has a fifty year plus history of resistance and no inclination to back down in the face of US pressure. Moreover, there are already signs of a significant deepening in Havana’s economic and political relationship with Russia, which both sides now publicly refer to as being refer once again as being strategic.

 

Washington’s latest announcements however come at a difficult moment for the Cuban government. It is continuing to struggle to reform its over-centralised, bureaucratic and inefficient planned economy in the hope that decentralisation and individual responsibility might deliver a more modern, productive, socially oriented economy.

 

Speaking recently to Cuba’s National Assembly as First Secretary of the country’s Communist Party, Raúl Castro stated that its government was preparing for what may be an extended period of hardship. He said that faced with the “increasingly threatening tone” of the US, equal importance was being placed on “preparing for the country’s defence, and the national economy’s development”.

 

He warned legislators that while the country was not in danger of returning to the hardships that followed the collapse of the Soviet Union, Cuba could face additional economic challenges that could worsen in coming months. He also said that measures were underway to reinforce the combat capacity of the country’s armed forces in accordance with its strategic doctrine of a ‘war of all the people’.

 

Uncertain period

What comes next is a period of uncertainty in relation to investment, trade and travel, and a growing international divide between Washington and its allies over Cuba.  

 

In a joint letter to Mr Pompeo the EU High Representative, Federica Mogherini, and the EU Trade Commissioner, Cecelia Malmstrom, made clear that the US decision on Helms-Burton broke commitments made by Washington in 1997 and 1998, and should not be conflated with shared concerns about human rights and democracy in Cuba, or the need to urgently to find a solution to the crisis in Venezuela.

 

Subsequently the EU and Canada issued a joint statement expressing concern about the impact of US policy on legitimate EU and Canadian business activity in Cuba. They also indicated they would work together to offset any extraterritorial effect by introducing countervailing sanctions against US entities and introduce actions at the World Trade Organisation.

 

Recent statements make it hard to escape the conclusion that President Trump and his most senior advisers have embarked on a strategy intended to engineer change in Cuba though economic hardship and the creation of discontent. If this is so it is policy which has unpredictable political, social, economic and migratory consequences for the wider region, placing ideology above realpolitik and what is humane.

 

David Jessop is a consultant to the Caribbean Council and can be contacted at

david.jessop@caribbean-council.org Previous columns can be found at https://www.caribbean-council.org/research-analysis/