Cuba Cautiously Opens Up To US Business
Sunday, US President Barack Hussein Obama travels to Cuba, he will be the 1st US President to visit Cuba in 90 years, opening the way for stronger trade ties with the embargoed Communist island nation.
American businesses are preparing to gain new customers in a country of more than 11-M people, the largest in the Caribbean.
“Cuba is open for business,” said Richard Feinberg, a senior fellow at the Brookings Institution who spoke Thursday at the 2nd Cuba Opportunity Summit in New York. He said the country has taken steps to resolve past impediments to the lifting of the US embargo, including negotiating debts owed by Cuba’s pre-1959 government and resolving 6,000 claims by people whose property was confiscated during Cuba’s Revolution.
He warned that Cuba’s Communist government, which has held power for more than 50 years, will proceed gradually and deliberately in broadening trade ties with the US.
“There is a strong commitment to sticking with their way of life,” he said. That’s especially true among older generations who fear change, in contrast with entrepreneurial millennials who are less risk-averse, he said.
US businesses seeking to do business in Cuba can expect to confront major regulatory hurdles that limit the scope of their activity.
Companies have to work through Cuba’s state agencies to hire local employees, who can receive salaries from American companies.
The US State Department is working to get the 10% levy on the USD removed to make foreign exchange transactions less cumbersome to US companies.
Mr. Obama’s trip to Cuba is significant in opening up the country to US businesses and the possible lifting of the trade embargo, which requires an act of Congress. Critics of the Cuban government want to see a stronger commitment to respecting human rights.
The travel industry is among the pioneers in bringing US citizens to Cuba on vacation, although the country is constrained by its inventory of 60,000 hotel rooms. By comparison, Las Vegas has about 168,000 hotel rooms and Orlando has 121,000, according to the data.
Cuba also needs upgrades to its ports and other infrastructure, said the President and CEO of Norwegian Cruise Lines Holdings Ltd.
He was born in Cuba and left with his family at age 7 in Y 1962. He said he eagerly awaits the possibility of bringing the company’s 1st cruise ship into Havana Harbor by the end of this year.
Carlos Gutierrez, the former US Commerce Secretary appointed by President George W. Bush and a native Cuban, said he recognizes that Cuba’s gradual liberalization may be frustratingly slow for US business people confronted with major regulatory hurdles, but change is coming.
About 200 people attended the Cuba conference at the NASDAQ HQ’s in New York.
Have a terrific weekend.
HeffX-LTN
Paul Ebeling
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