Have a Cigar: Cuba and Europe to Write a Business Plan

File photo of world leaders waving to the media during the group picture during the summit of the CELAC-UE in Santiago

Reuters reports that, eleven months before Barack Obama’s historic handshake with Raul Castro, Europe staged its own show of friendliness with Cuba. While little noticed, the article says, this gesture may end up doing far more to end the communist island’s isolation.

It all happened one hot January day last year at an EU-Latin America summit in Chile. Castro cheerily waved alongside European Commission President Jose Manuel Barroso for the official group picture and then, as the photo gathering broke up, German Chancellor Angela Merkel shook his hand. This was low key compared with when the U.S. and Cuban presidents greeted each other on December 10 after half a century of hostility. But all this warmth at Nelson Mandela’s memorial service in South Africa has brought no radical change and the U.S. trade embargo on Cuba, imposed in 1962, remains.

By contrast, the European Union decided last week to seek negotiations with Havana on increasing trade, investment and dialogue. [. . .] The gesture from Merkel, who grew up in the now defunct East Germany, was all the more notable as her country – along with fellow EU members Poland and the Czech Republic – has been reluctant to deal closely with Cuba, partly out of a lingering distaste for its own communist past.

Gianni Pittella, vice president of the European Parliament who attended the Santiago summit, said the decision to seek negotiations with Cuba had been a long process that gathered pace in Chile. Europe’s strategy is to encourage change. “Besides trade and investment, I hope it will be possible to begin a structured dialogue with Cuban civil society and with those who support a peaceful transition on the island,” said Pittella, who also awarded the EU’s human rights prize to Cuban dissident Guillermo Farinas last year. [. . .]

CARIBBEAN CAPITALISM

The EU is already Cuba’s top foreign investor but divisions after the summit nearly ended the overtures before they had scarcely begun. [. . .] Apart from the governments in Berlin, Warsaw and Prague, Sweden also had misgivings about what they regard as Havana’s repression of political dissent. [. . .] What helped to change minds was Cuba’s progress in implementing its five-year plan since 2011 which has relaxed the state’s grip on the economy. This has been accompanied by a relaxation of curbs on foreign travel and Internet use, as well as a fall in numbers of political prisoners.[. . .] The launching of an EU-Cuba dialogue is being closely watched in the United States where relations between the Obama administration and Cuba have also grown more pragmatic lately. [. . .]

The EU believes Cuba has the potential to become a dynamic economy like the Dominican Republic, another Caribbean island nation which once depended on sugar exports. It has diversified into manufacturing via free-trade zones that attract investors. Cuba’s problem is that aside from nickel, cigars and rum, it sells little to the outside world. Exports to the EU were worth just 739 million euros ($1 billion) in 2012, barely up from a decade ago. Still, there are niches to be exploited. Seafood exports have doubled over the past decade and Cuba is trying to attract global shippers to its deep-water Mariel port near Havana. [. . .]

For full article, see http://www.reuters.com/article/2014/02/21/us-eu-cuba-insight-idUSBREA1J0AE20140221

One thought on “Have a Cigar: Cuba and Europe to Write a Business Plan

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