Happy Memorial Day from the Cuba Central Team

Dear Friend:

Happy Memorial Day to our U.S. readers – and happy weekly news blast day to us all!
In our reports this week, you’ll notice that Britain’s Royal Ballet will be visiting Cuba, that Azerbaijan will soon help Cuba develop its energy, that Canada intends to have a somewhat noisier conversation with Cuba about human rights, and that Paraguay’s president will be visiting Cuba in early June.
At the same time, the U.S. is positioning itself against regional efforts to withdraw Cuba’s suspension from the OAS – a decision made in 1962.
The point is obvious and clear.  While the rest of the world carries on a normal conversation with Cuba – involving cultural exchange, travel and trade, diplomacy and serious business about political and human rights – we’re isolated in our relations and utterly stuck in time.  This is not about papering over differences, it is about living in this century and letting go of a failed policy that never was able to advance our ideals and values.
To its credit, the Obama administration began peeling back the embargo in April when it eliminated restrictions on Cuban-American travel to Cuba and the ability of our citizens to provide financial support to their relatives on the island.
That departure from U.S. policy took place just days before the Summit of the Americas, where President Obama met with the region’s leaders for the first time in his administration.  At that meeting, if there was one clear message, it was that we had long passed the time when the U.S. could decide, for itself and others, Cuba’s place in the region.
That is why the OAS debate is so salient and so troubling.  Reasonable men and women can differ over the OAS charter and Cuba’s place in the organization.  Some of those differences can be read in Cuba’s reaction to all of this – somewhat reminiscent of the phrase “I don’t want to belong to any club that will accept people like me as a member”  — former president Fidel Castro says his country doesn’t want to rejoin the OAS and questions its legitimacy.
But the U.S. shouldn’t glide past the larger symbolism of this discussion.  Engagement is the watchword of contemporary diplomacy, and the door that we think we’re shutting on Cuba may actually be slamming in our own faces.
This administration can surely do better…

Honduras is presenting a resolution that calls for the General Assembly of the OAS to discuss the lifting of Cuba’s suspension from the organization, EFE reported.
Honduras, the host country for the June 2nd meeting, has said that Cuba’s suspension from the OAS should be discussed in the General Assembly and will propose that it be included on the official agenda.
According to EFE, Honduras’ resolution calling for a debate of the Cuba issue will mark the first time the OAS has officially discussed Cuba in a session of the Permanent Council since 1962.
Speaking before the U.S. Senate Foreign Relations Committee this week, Secretary of State Hillary Rodham Clinton said that Cuba should not be allowed to rejoin the Organization of American States until it makes political reforms, releases political prisoners and respects human rights, the Associated Press reported.
“Any effort to admit Cuba into the OAS is really in Cuba’s hands,” she said. “They have to be willing to take the concrete steps necessary to meet those principles.”
“If Cuba is not willing to abide by (the charter’s) terms then I cannot foresee how Cuba can be a part of the OAS and I certainly would not be supporting in any way such an effort to admit it,” said Clinton, who will attend the meeting in Honduras.
As we noted last week, leaders throughout the region are calling on the OAS to annul a 1962 resolution that suspended Cuba’s membership.
“We’re hoping that the members of the OAS will abide by their own charter,” Clinton added.
Senator Richard Lugar, the Ranking Republican Member of the Senate Foreign Relations Committee, and a staunch of advocate of reforming U.S. policy toward Cuba, agreed with Secretary Clinton and released a statement that said in part, “Even those of us who feel that U.S. policy should be improved and want significant policy change in favor of direct dialogue believe that such change has to be deliberate and incremental.  In this regard, at the June 2-3 General Assembly meeting of the OAS in San Pedro de Sula, Honduras, it would be a grave mistake to suspend or repeal outright the 1962 resolution that suspended Cuba’s membership.”
Separately, Congressman Albio Sires (NJ-13) has circulated a letter signed on the island by 250 Cuban citizens protesting any decision by the OAS to admit Cuba into the organization.
In this Commonweal magazine article, Robert E. White, former United States ambassador to El Salvador and Paraguay, analyzes President Obama’s performance at the Summit of the Americas and provides insight into the possibility of Cuba returning to the OAS.
As Dr. William LeoGrande of American University points out, the issue of Cuba’s OAS suspension is a complicated one. LeoGrande and his colleague Dr. Philip Brenner wrote this informative piece outlining the complications and possibilities related to Cuba’s reintegration in the OAS.
When President Obama lifted restrictions on Cuban-Americans traveling and sending remittances to the island in April, he urged Cuba’s government to remove its tax on U.S. dollars entering the county.
“They could reduce charges on remittances to match up with the policies that we have put in place to allow Cuban-American families to send remittances. It turns out that Cuba charges an awful lot, they take a lot off the top,” Obama said.
However, Marc Frank reports in Reuters that because of the embargo, it is illegal for Cuba to use dollars or for anyone, anywhere to do business with Cuba in U.S. currency. Stepped up enforcement of banks trading dollars with Cuba under the Bush administration pushed the Cuban government to create a tax in an effort de-dollarize the economy in 2004.
“The U.S. embargo prohibits Cuba from using dollars for any reason. Therefore, remittances come here, American travelers come here, they change them into Cuban money, but Cuba can’t use these dollars, they have to change the dollars somehow into other currencies, and that costs money,” said Kirby Jones, an expert on business with Cuba.
The dollar was legalized in Cuba in 1993 and quickly became the dominant currency alongside the peso. The Clinton administration did not heavily police Cuba’s use of dollars, and its government was able to use them for financial transactions on the international market. However, in 2004 the Bush administration began to crack down on banks dealing in dollars with Cuba and the U.S. Federal Reserve fined Switzerland’s largest bank, UBS, $100 million for accepting dollars from Cuba and sent out warnings to other banks.
Banks soon became unwilling to accept dollars from Cuba leading the Cuban government to attempt to de-dollarize the economy and to encourage the circulation of Euros, Canadian dollars and other currencies that they could use on the international market. To do this, the government created the convertible peso, which it said was worth $1.08 and instituted a 10 percent exchange tax on all dollars entering the country. According to Reuters, this created the 18 percent exchange charge for convertible pesos, plus a processing fee, which resulted in the equivalent of a 20 percent tax on each dollar.  This, in turn, led to more Euros and fewer dollars entering the country.
As Frank points out, “it is hard to imagine Havana dropping the tax unless Washington allows it to use U.S. dollars” on the international market.
Representatives Rosa L. DeLauro (CT-3), James McGovern (MA-3), and Jan Schakowsky (IL-9), members of the Cuba Working Group, held a press conference at the U.S. Capitol to urge further changes in our Cuba policy, including passage of the bipartisan Freedom to Travel to Cuba Act (H.R. 874) to help advance U.S. concerns about human rights and democratization on the island after decades of a failed U.S. policy.
Also participating were Jose Miguel Vivanco, Director of the Americas Division, Human Rights Watch and Fr. Andrew Small, Director for the Church in Latin America, United States Conference of Catholic Bishops.
“The more we change, the more Cuba will change,” said Rep. McGovern, the Catholic News Service reported.
Father Small said the U.S. bishops are fully behind efforts for more access to Cuba, and the sooner the better. “We need not just incremental change but robust, bold change,” he said.
You can see additional coverage of the event here.
Along with 15 other Democratic and Republican Senators, Senate Finance Committee Chairman Max Baucus (D-MT), has introduced legislation to ease U.S. trade and travel restrictions with Cuba.
According to RTT news, the bill would:
  • Help farm exports to Cuba by allowing timely and direct cash payments for agricultural goods, by permitting U.S. banks to receive payment directly from Cuban banks for authorized agricultural transactions.
  • Require the Agriculture Department to promote U.S. agricultural exports to Cuba and offer technical assistance to U.S. entities interested in these transactions.
  • Lift the current ban on traveling to Cuba, allowing U.S. citizens and legal residents to travel to Cuba, and ease restrictions on exports of medicines and medical devices.
“It’s time for us to face the facts regarding Cuba,” Baucus said.
“It’s a fact that Cuba is one of our closest export markets. It’s a fact that our current trade and travel sanctions aren’t working. And it’s a fact that our farmers and ranchers in Montana – and across the United States – need help selling their high quality products in Cuba.”
The President of Paraguay, Fernando Lugo, announced this week that he will visit Cuba on June 3rd and 4th, marking the first time a Paraguayan leader will visit Cuba in over two decades, the Reuters news agency reported.
“We will visit Cuba to reinforce our cooperation agreements and friendship in health, education and culture,” said Lugo at a press conference.
“We will take advantage of our stay on the island to greet Paraguayan residents receiving scholarships by the generous Caribbean nation to become health care professionals,” he added.
Dozens of Paraguayans are studying for free in Havana and brigades of Cuban doctors attend poor residents in Paraguay.
The Spanish Press is reporting that Cuba kicked out four Spanish intelligence agents that were stationed at the Spanish embassy in Havana. According to El País, the agents returned to Spain after Cuba complained through diplomatic means that the Spanish Embassy, and in particular the CNI agents, were involved in Cuba’s internal politics.
Spanish Foreign Minister Miguel Angel Moratinos confirmed to reporters that some agents had left the island, but said it was part of a routine “changeover” of personnel and wouldn’t affect relations between the two countries, the Agence France-Presse reported.
The dispute is centered on the detention of Conrado Hernández, a Cuban citizen that was head the Society of Industrial Promotion and Reconversion (SPRI), an entity of the Basque Government. According to the New York Times, citing unnamed Cuban officials, Hernández was working for Spanish intelligence and recorded conversations he had with Vice-President Carlos Lage, Foreign Minister Felipe Pérez Roque and others. Negative comments about the Castro brothers and others made by Lage and Pérez Roque during the recorded conversations apparently contributed to their ousting in March when the tapes were confiscated by Cuban authorities, the Times reported.
The agents were reportedly in Cuba to keep tabs on members of the separatist group ETA who live on the island.
Peter Kent, Canada’s Minister of Foreign Affairs for the Americas, said this week that the quiet diplomacy of past Liberal governments has not worked with Cuba and that Canada will conduct more public discussions about human rights on the island, the CanWest News Service reported.
Kent was scheduled to visit Cuba this month, but his trip was canceled by Cuban authorities.
“This government is much more open in its discussion of foreign policy in speaking up on human rights, not just in the Cuban situation, but in other countries around the world and I think that the Canadian public as well, as perhaps citizens of Cuba…deserve a chance to see the process,” said Kent.

“We are very understanding of the Cuban situation. They have been isolated through the years of the Cold War by the Helms-Burton embargo, but Cuba stands today at a crossroads of history,” he added.

A new BBC report on Cuba’s medical diplomacy says Cuba’s medical programs have “helped boost its image throughout the world and paid dividends politically.”
Many people in Latin America and the Caribbean do not have affordable access to health facilities in their countries, but hundreds are being treated each day in Cuba by Cuban medical staff with the Cuban government footing the bill.
Over 24,000 medical students from across the world receive training in Cuba and Cuba provides tens of thousands of Cuban doctors to other countries to provide care to their most neglected citizens. Similarly, Cuba has rapid response teams that can respond to natural disasters in other countries, as they have in earthquakes that hit Pakistan and China.
Cuba’s Operation Miracle, launched just five years ago, has already restored eyesight to over 1.6 million people. Pando Ferrer Hospital in Havana alone is capable of performing 300 eye operations a day, ranging from treatment for cataracts and glaucoma to corneal transplants.
BBC points out that most equipment used is from Europe and Asia, since the embargo prevents U.S. companies from selling most medical products to Cuba.
President Obama even stated at last month’s Summit of the America’s that many leaders from the region spoke to him about the importance of the medical support Cuba is providing in the region.
ECONOMY

One of Cuba’s largest business entities, CIMEX, is facing a cash crunch that has forced it to delay payments for some products, the head of the state-owned company said this week, according to a Reuters news agency report.
Cimex President Eduardo Bencomo said that payments for some imported items were being delayed, but that the country would meet its financial obligations.
Bencomo also said that Cuba has not seen an increase in the amount of money sent by Cuban Americans since the U.S. relaxed restrictions on remittances being sent to the island.
Cimex is responsible for processing remittances as well as running stores where goods are sold in hard currency, real estate projects and food services.
In a separate article, Reuters reports that Cuba’s economy will suffer in 2009. A Cuban university think-tank, the Center for the Study of the Cuban Economy, said that Cuba’s economy will only slightly grow or shrink in 2009. Damage from last year’s hurricanes, the global financial crisis, low world nickel prices and low productivity have led to a tough economic outlook.
“Our forecast (for 2009) is for growth to be around 1 percent, but it could fall anywhere between a range of negative 0.5 percent and positive 2.5 percent,” said an economist at the Center.
According to Reuters, over the last few weeks the state-run media has been asking Cubans to tighten their belts and work harder to confront the impact of the international financial crisis.

ENERGY

Azerbaijan will soon join the list of countries planning to participate in oil cooperation agreements with Cuba, Russia’s RIA Novosti reported.
An agreement for Azerbaijan to begin developing oil fields in Cuba was reached at a meeting of the Azerbaijani-Cuban intergovernmental commission in Baku on Tuesday.
“This is certainly a very interesting direction. And we hope that the work which is due to be completed over the next year will become a reality,” Azerbaijani Minister of Culture and Tourism Abulfaz Garayev said after the meeting.
Meanwhile, the Washington Post reported that it’s the 5-20 billion barrels of oil that sit off Cuba’s northwest coast” could help thaw trade with the U.S.”
According to the Post, “as the Obama administration gestures toward improved relations with the Castro government, the national security, energy and economic benefits of Cuban crude may make it a powerful incentive for change.”
“American oil and oil equipment and service companies have the capital, technology and operational know-how to explore, produce and refine in a safe and responsible manner Cuba’s potential oil and natural gas reserves. Yet they remain on the sidelines because of our almost five-decade-old unilateral political and economic embargo,” former oil executive Jorge Piñón recently told members of Congress.
However, spokesmen for Chevron and the American Petroleum Institute said they are not lobbying the U.S. government for a change in policy and Texas congressional representatives said they are focused on lobbying for drilling rights in U.S. territorial waters.
“Companies like us would have to see a change in U.S. policy before we evaluate whether there’s interest,” Chevron spokesman Kurt Glaubitz told the Post.
But according to Benjamin-Alvarado, a political scientist at the University of Nebraska-Omaha who studies Cuba’s energy sector, all U.S. companies have plans to move forward as soon as U.S. policy changes.
The government of Cuba is warning that if energy consumption isn’t reduced they could be forced to begin programmed “blackouts” to cut down on energy costs, the Reuters news agency reported.
The Granma, the Communist Party’s official newspaper, repeated warnings this week that Cubans were using too much energy and that planned blackouts were imminent.
“The spendthrift mentality that persists in many of us, as if nothing was happening around us, has become more intolerable in these moments,” the Granma said in an editorial.
Planned and unplanned blackouts were common from 1992-2005 as Cuba suffered from the economic fallout of the collapse of the Soviet Union.
Mariela Castro Espin, who directs Cuba’s Center for Sex Education (CENESEX), led a celebration in Cuba to draw attention to gay rights on the island and commemorate the International Day Against Homophobia.
According to the Associated Press, hundreds of gay Cubans danced in the streets, attended education panels and presentations for magazines, CDs and books about sexual diversity and gay rights.
“We’re calling on the Cuban people to participate…so that the revolution can be deeper and include all the needs of the human being,” said Mariela Castro.
The Havana Times published this report on the event and the history of homophobia in Cuba, accompanied by a photo gallery of the celebration.
London’s Royal Ballet will perform at the Gran Teatro de Havana and Karl Marx Teatro on July 14-18, marking the group’s first visit to Cuba, the Reuters news agency reported.
The Royal Ballet’s principal guest dancer is Carlos Acosta who is from Cuba and was anxious to perform in his home country. The trip will also include a tribute to Cuban ballet legend Alicia Alonso.
“Because of the heritage of their national ballet, there is probably no other place in the world that has a love of classical ballet like Cuba,” Royal Ballet’s administrative director Kevin O’Hare told Reuters.
The World Health Organization representative in Cuba said this week that the island’s 1,488 hundred-year-olds comprise one of the world’s highest rates of centenarians per capita in the world, the Agence France-Presse reported.
Speaking at a conference, Lea Guido said that Cuba “can compare itself with the most developed states in Europe and the United States” and that it’s high rate of citizens with longevity results from access to free health care, sexual education, medicine and a strong promotion of health and healthy habits.
Recommended Reading:

No bloom yet in US-Cuba ties after April overtures, Reuters

The United States and Cuba offered a glimmer of hope last month that they might be ready to end years of hostility, but neither side has moved much since then to widen that window of opportunity.

Cuba Without Illusion, National Review Online
President Barack Obama has reinvigorated the embargo debate, expressing his desire for “a new beginning with Cuba” and loosening various sanctions, including restrictions on family travel and remittances to the island.

Charter Companies Flying to Cuba Thrive, New York Times

Only a handful of American charter companies have landing rights in Cuba, and with the new White House policy letting Cuban-Americans visit relatives there as often as they want, ticket prices have become political.
Around the Region:

President Michelle Bachelet delivers her final State of the Union Address, the Patagonia Times

Now very much in the final stretch of her presidency, Michelle Bachelet delivered her fourth and concluding state of the nation speech Thursday, highlighting some of her major accomplishments and promising a flurry of measures aimed at helping poorer Chileans weather the current World financial crisis.

President Evo Morales met with U.S. envoy Thomas Shannon on Thursday and called for an about-face in relations with Washington, saying past diplomatic spats could be overcome if the new U.S. government refrained from meddling in Bolivia’s affairs.

Venezuela’s Chavez and El Salvador’s Funes Discuss Cooperation, Venezuelanalysis.com

Mauricio Funes, the president-elect of El Salvador, made a formal visit to Venezuela to meet with President Hugo Chavez on Tuesday.
Funes’s critics have said his presidency will be heavily influenced by Venezuela, while Funes has emphasized that “integration with Central America and strengthening relations with the United States will be the priority of our foreign policy.”
After the meeting, the two leaders announced the creation of a bilateral commission between the two countries to develop projects of cooperation in commerce, energy, and other economic sectors, and social exchange.
Funes will be sworn in as El Salvador’s president on June 1.
Until next week,
The Cuba Central Team
www.democracyinamericas.org


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