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Cuba and the U.S. will begin to normalize relations

bloomberg.com

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Re: Cuba and the U.S. will begin to normalize relations

#81

Post by wcummings »

ghayes wrote: post #57
glup wrote: post #54

Earlier quoted context omitted.

Agriculture, including tobacco production, accounts for only approximately 4% of Cuban GDP--after heavyweights like tourism (embargo just prevents Americans from going there), gas export, industrial production, and the medical sector. Of greater interest to HN readers than the implications for one trivial luxury good, Cuba has one of the greatest mismatches between literacy (~97%) and telecom development and accessib…

Note: Americans could previously go there; you just couldn't go directly from America.

Americans could previously go there, they just couldn't spend money there and no airlines offered flights from the US.

Re: Cuba and the U.S. will begin to normalize relations

#82

Post by termain »

Florin_Andrei wrote: post #71
hyperbovine wrote: post #51

Earlier quoted context omitted.

When I was in Cuba, a lot of people I talked to were obviously in favor of lifting the embargo, but others expressed misgivings about what it would do to their culture and society. Cuba is an indescribably weird place where almost everybody is (on paper anyways) poor, yet education, health care and the arts flourish. Violent crime is virtually unheard of, say what you will about how they achieve that. They are very p…

> Cuba is an indescribably weird place where almost everybody is (on paper anyways) poor, yet education, health care and the arts flourish. Violent crime is virtually unheard of I grew up in the Eastern Bloc, I was in college when the revolutions happened. Now I live in the US. When I describe the life under communists to people who grew up here, I mention, of course, the lack of political freedom, the demagoguery, e…

Unemployment is such a funny thing. In a free market economy, unemployment is a necessity but seems to be treated as a universal evil.

Re: Cuba and the U.S. will begin to normalize relations

#83

Post by NoPiece »

tormeh wrote: post #28
refurb wrote: post #21

Earlier quoted context omitted.

The one thing I don't understand is how the US embargo is to blame for the lackluster Cuban economy. Cuba is free to trade with most Western countries including the EU and Canada. How much of the economic misery is due to the Castro government and how much is due to the US embargo?

The Helms–Burton Act dictates that any firm that does trade with Cuba can't trade with the US. So no trade for Cuba, then.

Presidents Clinton and Bush both waived that part law, and Canada, Mexico, and the EU all don't recognize it. So I'm not sure it has had any real impact other than antagonizing US allies, and generating some private lawsuits.

Re: Cuba and the U.S. will begin to normalize relations

#84

Post by joezydeco »

glup wrote: post #65
joezydeco wrote: post #17

The timing seems really clever here. The USA and OPEC flood the market with oil (literally), crashing prices and sending the Ruble into a spiral. Just as Cuba starts to worry about Russian support going forward, the USA swoops in to provide some economic bracing.

This analysis is a little off-- Cuba has received only symbolic support from Russia since the fall of the USSR. However, dynamics in the oil market are significant for Venezuela, their chief ally (and main supplier of energy resources!).

Putin handed Cuba $32 billion dollars a mere 5 months ago:

"During the [July 2014] visit, Putin agreed to write off $32 billion in Russian debt to Cuba, leaving just over $3 billion left to pay over the next 10 years. This was a significant economic weight lifted from Havana, whose gross domestic product shrank by up to a third with the loss of direct aid and subsidies from Moscow after the Soviet Union fell. Putin and Raúl Castro also agreed to new deals in energy, health and disaster prevention and help with building a vast new seaport. Moscow is also now exploring for oil and gas in Cuban waters, right in the U.S.’s backyard."

http://www.newsweek.com/2014/08/22/russia-and-cuba-get-back-...

Re: Cuba and the U.S. will begin to normalize relations

#85

Post by Mandatum »

mathattack wrote: post #47
iandanforth wrote: post #7

I've visited Cuba on a Canadian passport. Aside from the beautiful beaches the thing that struck me most was the desperate poverty of people living in shacks outside the 5 star resorts. While I hesitate to predict that this change will be all for the good, I do believe that the poorest in Cuba will benefit significantly from increased trade.

When you start from such a low base, there is enormous room for growth. The question is what can they export? Cigars? Medical personnel?

Sugar, shellfish, citrus and coffee. Medical products and tobacco are small parts of what they export. They also export nickel and cobalt which have generated more than $2B/yr in some years.

Re: Cuba and the U.S. will begin to normalize relations

#86

Post by glup »

dragonwriter wrote: post #80
glup wrote: post #74

The title of the Bloomberg article "Cuba’s Half Century of Isolation to End" perpetuates a major misconception for US citizens. Cuba isn't isolated from the rest of the world (in the manner that North Korea is) -- it's just the US and Cuba. The island is fully connected as a tourist destination for Canadians, Latin Americans, and Europeans and they import consumer goods from Korea, China, Vietnam, etc. There are majo…

The retaliatory policy the US has against any entity doing business with Cuba severely limits business engagement with Cuba, since firms that engage in many kinds of business with Cuba risk retaliatory asset seizures if assets come within the jurisdiction of US courts. While foreign trade with Cuba is less constrained by the embargo than direct US trade, it is inaccurate to say that the embargo only affects direct tr…

Right, that's an important nuance. But that means that a firm in a country like Spain is only constrained by the embargo if it also does business with US companies, right?

Re: Cuba and the U.S. will begin to normalize relations

#87

Post by raldi »

What are we going to do about all the trademark conflicts? US rum and cigar companies stole the brand names of famous Cuban companies, because they knew they could get away with it.

To see what I mean, Ctrl-F dueling on http://en.m.wikipedia.org/wiki/List_of_cigar_brands

Re: Cuba and the U.S. will begin to normalize relations

#88

Post by peterwwillis »

It's kind of funny, but this won't actually bring all warm-n-fuzzies from the people most affected by it. The refugees/dissidents in Miami are saying this isn't going to change anything because it allows the Castro regime to double down on economic growth from new business relations with the US. The non-refugees are saying this will make immigration worse. The people both on the island and those illegally importing products into the country from Miami may face higher prices and tighter restrictions. And if political reform comes, it could be at the cost of dismantling the relatively strong public health and education systems.

Re: Cuba and the U.S. will begin to normalize relations

#89

Post by vidarh »

hughw wrote: post #30
joezydeco wrote: post #17

The timing seems really clever here. The USA and OPEC flood the market with oil (literally), crashing prices and sending the Ruble into a spiral. Just as Cuba starts to worry about Russian support going forward, the USA swoops in to provide some economic bracing.

Literally?

Literally means figuratively too now, didn't you get the memo? (yes, I agree it's annoying, though I've probably done it myself more than once).

Re: Cuba and the U.S. will begin to normalize relations

#90

Post by krschultz »

glup wrote: post #86
dragonwriter wrote: post #80

Earlier quoted context omitted.

The retaliatory policy the US has against any entity doing business with Cuba severely limits business engagement with Cuba, since firms that engage in many kinds of business with Cuba risk retaliatory asset seizures if assets come within the jurisdiction of US courts. While foreign trade with Cuba is less constrained by the embargo than direct US trade, it is inaccurate to say that the embargo only affects direct tr…

Right, that's an important nuance. But that means that a firm in a country like Spain is only constrained by the embargo if it also does business with US companies, right?

Which ends up being a very large number of companies, and it can generally be enforced simply through preventing banks from working with a company.
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