US lawmakers, ag groups push Cuba trade
April 15, 2009
WASHINGTON (DTN) — Amid signs that Cuban purchases of US agricultural products continue to grow, congressional, farm and trade leaders say President Barack Obama’s decision to make it easier for Cuban-Americans to travel to Cuba and send money to relatives should be followed by policy changes to make it easier for farmers and agribusiness executives to travel to Cuba to sell products and for Cubans to buy them.
Obama has been considering revisions in Cuba policy prior to traveling to Trinidad this week for the Summit of the Americas, a meeting of heads of state of all the countries in the Americas and the Caribbean.
“This is a good first step, but we can and should do more,” Senate Finance Committee Chairman Max Baucus, D-Mont., said in a news release. “I urge the president to relax restrictions on the sale of U.S. agriculture products to Cuba. We need to make it easier for America’s farmers and ranchers to sell their high-quality products, including Montana’s world-class wheat and barley, to one of our closest markets.”
Sen. Byron Dorgan, D-N.D., also said in a release, “We should also immediately eliminate the roadblocks that the Bush administration put in place to make it harder for farmers to sell food to Cuba.” Dorgan added that he believes the entire embargo on trade with Cuba should be eliminated.
House Agriculture Appropriations Subcommittee Chairman Rosa DeLauro, D-Conn., noted that she has long opposed restrictions on sales of U.S. agricultural products and that she is a co-sponsor of the Freedom to Travel to Cuba Act.
In the fiscal year 2009 omnibus appropriations, Congress attempted to reverse Bush administration rules that require the Cuban government to pay for farm products before they leave the United States by refusing the Treasury Department any money to implement the Bush provision. But when Sens. Bob Menendez, D-N.J., and Ben Nelson, D-Neb., said the provision would stop them from voting for the omnibus bill, Treasury Secretary Timothy Geithner wrote them that he would continue to implement the Bush rule because, in his view, the underlying legislation needed to be amended if it were to be changed.
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After the omnibus passed, DeLauro, Dorgan, Baucus and 14 other senators sent letters to Geithner demanding an explanation of his interpretation and that he listen to their views. A Dorgan spokesman said Tuesday that Treasury officials have briefed Dorgan and that he is waiting for a formal written response to his request. The spokesman declined to say whether Geithner had changed his interpretation.
The conflict stems from differences over the Trade Sanctions Reform and Export Enhancement Act of 2000, which exempted U.S. agricultural products from the general embargo on trade with Cuba, but required that Cuba must pay “cash in advance” for U.S. agricultural products.
The Treasury Department’s Office of Foreign Assets Control initially allowed Cuba to follow the normal commercial practice of making payment before the goods were unloaded, but in February 2005, after there were reports that some payments were reaching U.S. companies late and that Cuba was unloading goods before making payments, Bush administration Treasury officials began requiring the payment before the goods left the port. The Bush administration also made it harder for U.S. farm and agribusiness leaders to travel to Cuba and for Cuban food safety officials to travel to the United States to inspect U.S. plants.
Cuban officials and U.S. farm and trade leaders have said the restrictions hurt sales. American Farm Bureau Federation President Bob Stallman said Tuesday that language in the omnibus allowing American farmers to apply for a general license for travel to Cuba rather than a license for each trip “would ease delays that significantly impact the ability to transact commercial sales with Cuba, which in some cases, have been lost to U.S. competitors because of the restriction.”
The USA Rice Federation noted Tuesday that U.S. rice exports to Cuba declined from 176,631.9 metric tons in 2004 to less than 13,000 metric tons in 2008 and blamed the Bush administration interpretation. “Vietnam and China were the chief beneficiaries of the OFAC reinterpretation,” USA Rice Chairman Jamie Warshaw said. “This embargo has cost the U.S. rice industry more than $3 billion in lost sales, and may have cost rural communities thousands of jobs.”
Jake Colvin of the National Foreign Trade Council noted that Geithner had promised at his confirmation hearing that he would follow congressional intent with regard to Cuba and said he should live up to that promise.
Meanwhile, the New York-based U.S.-Cuba Trade and Economic Council released a report showing that U.S. agricultural sales to Cuba have totaled $2.8 billion since 2001, that Cuba has been among the top 30 importers of U.S. farm products for the past seven years and that in January it ranked 19th.
John Kavulich, the council’s senior policy adviser, said Cuba’s purchases are “impressive,” particularly since they all been cash and have not involved either the private company or U.S. government financing that many U.S. exports require. But Kavulich warned against campaigns to allow Cuba to buy on credit, saying that Cuba has often not paid its bills to countries that provide credit.
jerry hagstrom can be reached at email@example.com