New Markets and New Opportunities For Cuba And The U.S.

Posted by on February 14th, 2017 | 1 Comment »

By: Karen Coble Edwards, Founder of KCE Public Affairs Associates

KCE is a consulting firm based in the Washington, D.C. area. Karen has worked with trade and agricultural development organizations with programs in more than 30 countries. This is the first of two blogs on agricultural trade and cooperation between the U.S. and Cuba. 

For more on the importance of regional and global trade, see the 2016 Global Agricultural Productivity Report®, Policy 5.

Hard boiled eggs are sometimes described as nutritional lifesavers in Cuba where even the many college-educated workers live on fixed salaries of about the U.S. equivalent of $25 a month. Photo credit: Karen Coble Edwards

Food price inflation and agricultural productivity permeate lives in Cuba, just as the aromas from their famous cigars reach everyone in a crowded room. Food security challenges influence national policy decisions as well as kitchen table economics.

The island nation’s trade balance is weighed down by importing 60 to 80 percent of the food needed for Cuba’s 11 million people and to support Cuba’s flourishing international tourism industry. Food costs burden personal budgets too. Even Cuba’s many college-educated workers live on fixed salaries that are the equivalent of about $25 (U.S.) a month.

Cuba sits just 90 miles off the Florida coast, but U.S. policy has limited U.S. farmers and companies from meeting Cuba’s demand for food and agricultural inputs, such as improved seeds, crop protection products and farm machinery. In early 2017, Members of the U.S. Senate and House have introduced bipartisan legislation to lift restrictions on U. S. agricultural exports to Cuba. Importantly, these bills would eliminate the U.S prohibition on providing private credit for those exports, which would end the trade-limiting requirement that Cuban customers pay cash for U.S. products.

Currently, Cuba imports grain and other agricultural products from Asia, South America and the European Union. These shipments can take up to 90 days to arrive compared to just 2 or 3 days if they were coming down the Mississippi River and through the southern U.S. ports.

Both Countries See Opportunities

While Cuba and the United States still have many political differences, leaders in both countries have focused on opening up markets for agricultural trade since they restored diplomatic relations in 2014.

Because of the trade embargo with the U.S., Cuba relies on food imports from Asia, South America and Europe, which can take 90 days to arrive. This upscale store in Havana has shelves lined with canned meat from Poland. Photo credit: Karen Coble Edwards

In 2016, I was part of an agricultural delegation to Cuba and heard directly from officials such as Deputy Director of the Cuban Ministry of Foreign Trade & Investment Enrique Valdes Cardenas. He said, “The most important priority would be to access the agricultural market and to buy from that market with credit under normal conditions.”

At the same time, Cuba has pledged to boost its own agricultural productivity. Cuban Ministry of Agriculture’s Director of International Affairs, Moraima Cespedes Morales, said, “Our country is updating the management model. These changes will increase yield and efficiency of agriculture and incorporate it into the economy.”

But the pace of change is likely to be slow. When asked about their timeline to implement changes, officials often quote Cuban President Raul Castro, saying, “No pause. No rush.” Meanwhile, the Trump administration has announced it will conduct a review of U.S. policies toward Cuba.

While improvements in U.S.-Cuban agricultural trade may take time, there are areas where the two nations are already collaborating, namely agricultural science, with potential benefits for improving agricultural productivity and sustainability in both countries.

Part two of this blog will look at Cuba’s significant investments and achievements in the agricultural sciences, Cuba’s collaboration with U.S. universities, and the potential benefits for U.S. farmers.

« On Our Plate: Hope for the Future of Ag in an Uncertain Season
Ag Sciences: A Sweet Spot for Collaboration between Cuba and the U.S. »

1 Comment

  1. Bill Edwards says:

    Enjoyed the informative article and look forward to Part Two.