Carter Visit May Boost Growing Cuba Trade

HAVANA —  Just across town from the diplomatic residence where former President Carter spent three emotional hours Thursday with Cuba’s top dissidents, the container ship Express quietly docked in Havana harbor.

Aboard the 526-foot ship chartered out of Jacksonville, Fla., were tons of frozen Michigan turkeys sold to Cuba by a trading company in Carter’s home state, Georgia, along with hundreds of thousands of eggs from the American Northeast.

The shipment is the latest in a series of American food imports to this island now allowed despite a 4-decade-old U.S. trade embargo.

The coincidental timing of the Express’ arrival--coming as Carter’s five-day visit rekindles the debate about U.S.-Cuban relations, the embargo and the issue of human rights in the island nation--was symbolic of the incremental yet significant changes that have taken place between the United States and Cuba in recent years.

On the political front Thursday, there were clear signs that Carter’s trip is having an impact here.

The ruling Communist Party’s daily newspaper, Granma, surprised many by filling more than two pages with a verbatim transcript of a speech Carter gave Tuesday to the Cuban people. The televised address included a bold call on Cuban President Fidel Castro to give his people greater freedoms, along with an appeal to the Bush administration to end the embargo.

The Cuban government also permitted Carter to meet freely and in private with nearly two dozen prominent dissidents, who then spoke openly to the foreign media gathered outside. Most of the activists were effusive in their thanks to Carter for, as one of them said, “validating” their existence.

But in the short term, the former president’s trip might have an even greater impact on economic relations between the U.S. and Cuba, several analysts say.

Carter also sharply condemned Washington’s Cuba policy during his speech here. He called on America to take the first step in normalizing relations by ending the embargo.

Despite the White House’s flat rejection of Carter’s appeal to lift the embargo and the widespread speculation that President Bush will announce further sanctions during a visit to Florida next week, Cuban officials and U.S. economic analysts say American exports to Cuba are likely to increase in the coming months.

Trade to Continue

Despite Sanctions

At the very least, said Vicki Huddleston, who heads the U.S. diplomatic mission here, the trade will continue apace.

“It has to,” she said. “It’s the law.”

The cash purchases were authorized by Bush’s predecessor. In October 2000, President Clinton signed the Trade Sanctions Reform and Export Enhancement Act, which allows Cuba to buy U.S. food and medicine, though only on a cash basis, as an exception to the embargo.

At first, Castro balked. The Cuban leader, who has remained in power for 43 years despite the embargo and the collapse of his longtime benefactor, the Soviet Union, said he would not buy “a single grain” of American rice unless the U.S. lifted a cash-only restriction.

Hurricane Changes

Castro’s Position

Then, in November, along came Hurricane Michelle. The storm devastated the island’s agricultural breadbasket, threatening Cuba’s strategic food reserves. In response, the U.S. government offered to send food aid to the island.

Castro declined. But the offer spawned separate yet parallel moves by the Cuban leader and by the U.S. agricultural companies that have been lobbying Congress for years to open the Cuban market.

Castro initially said Cuba would make a one-time purchase of U.S. goods to replenish food stocks. But it quickly became much more than that.

Thursday’s shipment on the Florida-based Crowley Liner Services, which chartered the Express, was part of a third round of purchases by Cuba’s state-run Alimport, according to the company’s president, Pedro Alvarez. Crowley made the first U.S. food delivery in December.

Speaking at a news conference this week that was almost unnoticed amid coverage of Carter’s history-making visit, Alvarez said the 550,000 tons of American goods that Cuba has bought since the first contract was signed in November represent 10% of the island’s $1 billion in annual food imports. He added that Cuba plans to keep buying, and even expand its purchases to include as many as 300 new products, including brand-name items.

U.S. industry sources believe that Cuba’s annual food-import bill is closer to $750 million but that the country remains a significant, attractive and largely untapped market.

“The blockade is hurting us,” Alvarez said, “but it is hurting U.S. companies even more, because it denies them easy access to a nearby market.”

The portly, silver-haired Alvarez described himself as an entrepreneur, “not a politician.” But clearly, the food purchases and the strategy behind them are as political as they are economic.

“The purchases made in November clearly had a political component,” said John Kavulich, president of the New York-based U.S.-Cuba Trade and Economic Council, which provides encyclopedic commercial information about Cuba.

“The Cuban government quite smartly determined in November 2001 that the way to re-energize the business community in the U.S. and the way to re-energize Congress for initiatives on Cuba was to provide financial value to a desired constituency,” Kavulich added in a telephone interview this week.

An analysis published Wednesday by Kavulich’s council of the ensuing trade showed its broad potential political impact on the U.S.

The imported products--ranging from corn, rice and wheat to chicken livers, turkey and peas--came from 27 U.S. states that have 344 of the 538 votes in the Electoral College.

Those states also account for about 66% of the members of the House and 54% of the Senate, the council said.

And that was no coincidence, according to U.S. industry sources. Many of the producing states are represented in Congress by legislators who have been fighting the hardest to ease or lift the Cuban embargo and to pass legislation permitting travel by U.S. citizens to the island. Many of those same legislators issued statements this week praising Carter’s visit and strongly endorsing his call to lift all U.S. sanctions on Cuba.

Such a voting bloc, analysts say, eventually could counter the small yet vocal and vote-rich Cuban American lobby in South Florida, which has influenced U.S.-Cuba policy for decades. The lobby has helped shape national election results in the past and is crucial to the reelection bid in November of the American president’s brother, Florida Gov. Jeb Bush.

The political impact of U.S. food exports to Cuba has not been lost on the Bush administration.

“It’s part of a strategy to get financing and get the travel ban lifted,” Huddleston said, although the mission head added that the food is helping Cubans at a time when the Sept. 11 terrorist attacks have further hurt their economy by cutting into vital tourist trade.

U.S.-Cuba Trade

Bolstered by Carter

In March, conservatives in the Bush administration went so far as to revoke Alvarez’s visa to visit the United States.

Alvarez insists that his trip was meant to reinforce business relationships with his U.S. suppliers. Administration sources said they suspected Alvarez’s real motives were to lobby Congress and the American people.

Alvarez denied the charge and said he will apply for another visa in the coming days.

Still, despite the toughening of the administration’s position on Cuba that has accompanied Carter’s trip this week, some industry analysts believe that the visit might well bolster the burgeoning U.S.-Cuba trade.

“Quite likely, there will be a spike in the commercial transactions to compensate for or to deflect from what might not happen on the political side,” Kavulich said.

Taking a longer view, he said: “The relationship between the U.S. and Cuba has always been about a series of moments--not a single moment.... The visit by President Carter is a significant moment, but it’s not a seminal moment. The relationship will change in incremental steps.”

The bottom line: Many of the key steps will be in commerce.

“What has been the barometer in the relationship in the last four years? It’s been the commercial angle,” Kavulich said. “Commerce is the only facet you can look at and say, ‘Yeah, there have been changes there.’”