Tag Archives: Cuba-Canada Relations

CUBA’S EMERGING STARTUP SCENE GIVEN A CANADIAN TECH BOOST

Jacob Serebrin

Special to The Globe and Mail, Monday, Feb. 01, 2016 5:00AM EST

Few countries are as technologically isolated as Cuba. Home Internet is rare, data plans are non-existent and, in a country where doctors make the equivalent of around $70 a month, paying almost $3 an hour for government-run WiFi is too steep for many.

Yet, even here, tech startups are beginning to emerge and they’re getting some help from Canada. Montreal technology hub Notman House has launched a program to give Cuba’s nascent startup scene a boost.  The idea of Develop Cuba is to create a seed fund and a way to support and educate the community on how to build an ecosystem,” says Noah Redler, the campus director at Notman House and the initiator of the Develop Cuba project. “The major obstacle they have isn’t around talent, it isn’t around want or desire, it’s literally just that basic seed capital.”

In Cuba, a little money can go a long way. So far, Develop Cuba has raised a few thousand dollars to rent space for startup groups to meet in Havana and bought a projector – a rare piece of equipment in a country where even basic supplies can be hard to find.

The next step will be to send a group of mentors from Montreal to visit Havana and work with local startups. If that goes well, Mr. Redler wants to help open Cuba’s first co-working space. The goal is to build capacity for Cuban startups, he says. While Canadians may be helping to get the project off the ground, it will be led by local people.

Internet usage has grown rapidly since the Cuban government lifted an almost total ban on Web access in 2008. By 2014, the country had more than three million Internet users, a little more than one-quarter of the population, according to Cuba’s national statistics agency. By now, that number is almost certainly higher.

On a Thursday afternoon in mid-January, about a dozen people are gathered in a public square in downtown Havana, looking at their phones. A couple more sit on nearby benches with laptops. It’s a scene that would be unremarkable in Canada, but was extremely rare in Cuba until just a few months ago.

In June, Etecsa, Cuba’s state-owned telecommunications monopoly, cut the price of Internet access in half and opened dozens of new WiFi access points in parks and public squares across the country. More have opened since then. Before that, getting online usually required waiting to use a computer at an Etecsa outlet or a post office; WiFi was rarely found outside of hotel lobbies. Free WiFi is still almost unheard of, and Cubans have to prepay and show ID to get online.

For startups, “the most difficult part is accessing the Internet,” says Martin Proenza, the founder of YoTeLlevo, a website for booking taxis. While his business is generating revenue, it’s not profitable enough for Mr. Proenza to afford home Internet. Instead, he relies on his day job at a government-owned software company for Internet access.

The lack of mobile data means that Cuban apps are generally built to work offline. AlaMesa, an app for finding restaurants, is fully functional without an Internet connection. Its restaurant directory and map are downloaded onto a user’s phone. If a user opens the app when they do have an Internet connection, the database is updated. “Considering the insufficient connectivity infrastructure and cost of Internet access in the country, an offline solution was mandatory,” says Alfonso Ali, AlaMesa’s lead programmer.

But they also face a uniquely Cuban challenge. “Due to U.S. blockade restrictions, we are unable to use PayPal or Stripe,” Mr. Ali says. “So standard operations like online booking, coupons, etc., are very difficult and costly to implement.”

The Cuban government appears to have taken little notice of the country’s growing startup community, but there are fears about what will happen if they do. While economic reforms that began in 2008 have opened the door to an increasing number of private businesses, there are no provisions for tech startups, making them illegal.

“You have to keep yourself under the radar,” Mr. Proenza says. “But is it a big concern? No. Really, the state is not running after people for creating online businesses.”  He does think the government will allow startups to operate legally in the future, and says that’s a view shared by others in the startup community.

In Montreal, Mr. Redler says he sees some hopeful signs – accommodation-rental site Airbnb was allowed to enter the Cuban market earlier this year; there are now over 2,000 listings. But he says he doesn’t expect change to come rapidly.

Despite the challenges, Cuban business owners say they’re optimistic about the future. “The Cuba education system is very good, so it’s very easy to find talented people to work on any field of innovation,” Mr. Ali says.  “We used to say ‘need is the mother of invention,’ so people in Cuba have good talent, skills and the mindset to find solutions to almost any problem.”

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THE LEADING CANADIAN EXPERT ON CUBA, MARK ENTWISTLE, FORMER AMBASSADOR TO CUBA, ON LATE-NIGHT CHATS WITH FIDEL, THE HARPER YEARS OF DIPLOMACY AND HOW TO DO BUSINESS IN HAVANA

RICHARD BLACKWELL

 The Globe and Mail Last updated: Friday, Jan. 29, 2016 2:52PM

Original: How to Do Business in Havana

When Mark Entwistle was Canada’s ambassador to Cuba in the mid-1990s, a knock on the door of his Havana residence might mean Fidel Castro was dropping by for a chat.

“He had a house that was maybe half a kilometre up from the official residence of the Canadian ambassador,” Mr. Entwistle said. “He used to stop by all the time. By himself. There would be a knock. It would be this big hulking figure, and he would ask if he could come in and say hi and have a gin and tonic. We’d talk in the backyard, we would talk in the living room. It was a quite remarkable thing. I kept pinching myself because … love him or hate him, he is one of the historic figures of our lifetime.”

Mr. Entwistle has parlayed his deep connections into a consultancy practice that helps Canadian and American companies prepare to do business in a Cuba increasingly open to foreign corporate involvement. His work with American firms has exploded since Dec. 17, 2014, the day U.S. President Barack Obama and Cuban President Raul Castro announced an unprecedented thaw in relations after more than five decades of distrust and detachment.

Mr. Entwistle is in a unique position to understand the subtleties of the change in U.S.-Cuban diplomatic relations. He spent years in Canada’s foreign service, with postings in Israel and the Soviet Union. He then served as spokesman for the department of external affairs and press secretary to prime minister Brian Mulroney, before being sent to Cuba as Canada’s ambassador from 1993 to 1997.

After 15 years running his own consulting firm, he teamed up in 2012 with former Onex Corp. executive Tony Melman, and former politician and Magna International Inc. executive Belinda Stronach, joining their merchant bank Acasta Capital. There, he runs the Cuban advisory arm – a division called Acasta Cuba Capital.

Mr. Mulroney describes Mr. Entwistle as “the leading Canadian expert on Cuba” whose combination of diplomatic and business skills gives him a unique perspective. As ambassador, he was a “sure pair of hands” with a “problem-solver bent,” the former prime minister told me in a brief phone chat. While Cuba is still somewhat archaic with a Byzantine political structure, “Mark is the kind of guy who can guide Canadian and American companies through these different layers of difficulty,” Mr. Mulroney said.

Indeed, Mr. Entwistle has a sophisticated and nuanced take on Cuba and its moves to open up relations with the United States. But I have to admit that his personal anecdotes are what grab my attention most during our three-hour lunch at Sassafraz in Toronto’s Yorkville area. I’m so captivated that by the time I finish my Arctic char and he polishes off his nine-spice roast chicken breast (him much later, as he is doing most of the talking), the restaurant – which had been packed and noisy – is completely empty.

Mr. Entwistle’s close relationship with Fidel, and the degree of access he had to the Cuban government when he was ambassador, was mainly a result of Canada’s unwavering support during the depths of the U.S. chill. “We were players in many ways,” he said. “That is not the case now. There are so many competitors, and now that the Americans have arrived it is sucking up all the oxygen.”

But during Mr. Entwistle’s time as ambassador it was not unusual to get a call in the middle of the night and be summoned to Fidel’s office. “He would ask questions … he was very interested in Canadian politics … what it was like living beside the United States.” Sometimes Fidel would come to the Canadian ambassador’s residence for formal dinners, especially if Pierre Trudeau – then long retired – was in town. Mr. Trudeau was “one of the very few people that I ever saw Fidel sit and listen to, in true listening mode, not interrupting [or] formulating what he was going to say next,” Mr. Entwistle said. “It was not a mentor role, because Fidel Castro would never have a mentor. It was as an inadvertent confident. It was personally very important to Fidel.”

As a former diplomat, Mr. Entwistle is hesitant to use harsh words, but he is unequivocal about Canada’s weak efforts to take advantage of our long-standing warm relationship with Cuba. “I think it has been squandered,” he said, although “it is not gone. It is still there. The Cubans, in a way, are waiting for us to come back.”

Aside from mass tourism, and the operations of Toronto-based mining giant Sherritt International Corp., “there is effectively no major Canadian [business] play in Cuba. Against the backdrop of history, of what we used to share together, the Cubans find it odd.”

Some, but not all of the blame, can be placed on the Stephen Harper government, which was leery of appearing to be too close to a communist regime, Mr. Entwistle said. The relationship “has never been hostile, even in the glacial period of the Harper years. It was just benign neglect. The relationship is in sort of an auto-pilot mode, with the exception of all our tourists, who drink the mojitos.”

With a new government in Ottawa, and the Americans ready to descend on Cuba, it is time for us to refresh the relationship and take advantage of an economy poised for takeoff, Mr. Entwistle said. “Canada has been gifted an asset, which is years of unbroken diplomatic relations. It is to this day recognized in Cuba. We get given space that we probably don’t deserve. We are given a hearing … But the goodwill has a half life [and] it has been ticking away for a long time.”

It may not be too late to take advantage of the relationship, but if Mr. Entwistle’s business in the United States is any indication, we need to get moving, and soon.

American business sees Cuba as a potential gold mine since the re-establishment of diplomatic relations and the lifting of some sanctions, he said. Havana is “humming and buzzing” with Americans ready to take advantage of the new relationship – but the U.S. trade embargo is still in place and it is unclear how the complex web of restrictions can be lifted without support in Congress.

Some potential U.S. investors are trying what Mr. Entwistle calls “crazy stuff” such as attempting to buy up beachfront property – even though it is owned by the state. But many others are making more cautious overtures.

The real game changer, he said, would be a further climb-down in travel restrictions, to allow general tourism from the U.S. – letting average Americans see the place for themselves. Some estimates suggest four million Americans would go in the first year after the ban is lifted – a tsunami of visitors Cuba could not handle at the moment.

Despite the U.S. business curiosity, Cubans are intent that a renewed domination of their economy by Americans will not occur, Mr. Entwistle said, and they are not prepared to revamp their political structures at the behest of the United States. Cubans are, psychologically, much more independent than they were before the revolution, he said. “They have discovered the value of their own assets, which they didn’t truly understand before.”

There will likely be some further political reforms after Raul Castro steps down as president in 2018, Mr. Entwistle said, including a move to a more representative government. But that will happen on Cuba’s own terms, and not in response to U.S. pressure. Indeed, he said, awkward U.S. efforts to use intelligence programs in Cuba to push for regime change – such as a recent attempt to get Cuban hip-hop artists to put anti-government content in their lyrics – is counterproductive.

In the meantime, Americans – or Canadians – who listen carefully to what the Cubans want in terms of economic development, and are patient in nurturing relationships on the island, could do very well there, he added.

Many Americans Mr. Entwistle takes to Cuba for the first time are “bug eyed” about what they see. “They have big saucer eyes, and they are usually quite nervous going in because they have been brought up believing it to be a prison camp,” he said. “Then they say ‘This a normal county. There are no tanks on the street.’ ”

Eventually, the American entrepreneurial instinct kicks in, Mr. Entwistle says. “The business guys’ antennas start bouncing like crazy. They say: ‘Oh my God … the opportunities here!’”

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Gary McMahon (IDRC), Ambassador Mark Entwisle, Francisco Leon, UN CEPAL) and Lourdes Tabares U de La Habana). at the inauguration of the Carleton University – University of Havana Masters Program in Economics, Havana, November 1993

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CAN CANADA FULLY LEVERAGE ITS UNIQUE TRADE RELATIONSHIP WITH CUBA?

Canadian Sailings: December 3, 2015 @ 8:32 am

Original Source:        http://www.canadiansailings.ca/?p=10739

By Alan M. Field

zzzzzzzzzzStarved for new markets to conquer, American exporters and investors are avidly awaiting the imminent end of the fifty-five year-old U.S. trade embargo of Cuba. Given the current abundance of Cuba-focused business conferences, seminars and traveling delegations to the island-nation, Canadians might well be wondering whether the mania for all things Cuban in the U.S. will also provide a golden opportunity for Canadians to leverage their unique ties with Cuba. Or will it, on the contrary, signal the end to that special relationship at precisely the time when the rest of the world has discovered Cuba?

Trade relations between Canada and Cuba originated during the era when vessels from the Atlantic provinces of Canada traded codfish and beer in Cuba for that country’s rum and sugar. “Canada has been a major trading partner with Cuba dating back to the 1800s,” notes Arch Ritter, an economist at Carleton University, who has written extensively about Cuba’s economic history. “Our ties have been longstanding, and we have never cut trade ties with Cuba.”

Over the past few decades, trade ties between the two countries have grown significantly, but remain modest compared with the volumes that could follow the end of the U.S. trade embargo, and the re-opening of U.S. foreign investment in Cuba. In August 2015, bilateral trade between Canada and Cuba amounted to $100.7 million [Canadian dollars], compared with just $58.4 million in August 2000, and only $33 million in August 1990. From 2000 to 2008, the value of Canadian exports to Canada grew at an annual rate of 11 per cent, while imports from Cuba grew at a rate of 10 per cent. Ontario is the largest provincial exporter to Cuba, followed by Quebec. Manitoba and British Columbia have been the fastest-growing provincial exporters in recent years, according to a report by the Library of Parliament in Ottawa.

Mark Entwistle, a former Canadian ambassador to Cuba (1993-1997) and a founding partner of Acasta Capital, a Toronto-based investment firm, recalls the long decades when Canadian diplomats were the only representatives of any Western democracy at Havana cocktail parties, “Among Western democracies, Canada is the only one that never broke relations with Cuba even once,” Entwistle added.

Canadians imported Cuban sugar, rum and cigars, while exporting a lot of machinery and equipment that “Cuba could no longer get from the United States,” explained Ritter. During the 1990s, when the Soviet Union stopped subsidizing Cuba, the island’s economy “really deteriorated,” added Ritter, “and ties with Canada really intensified. Cuba decided it needed tourism, so it promoted that sector. We became the big tourist country for Cuba, and people said, ‘Cuba’s best friend is the Canadian winter.’” Nowadays, Cuba ranks as the third-most popular overseas destination for Canadians – after only the United States and Mexico – while Canada is Cuba’s largest source of foreign tourists; over one million Canadians visit each year, or more than 40 per cent of all foreign visitors to Cuba.

Burned by Cuba’s ups and downs

During the 1990s, Cuba opened up its economy “a little bit” to foreign enterprises, added Ritter. The mining sector became the focal point of great activity as “a lot of Canadian companies went down there to see if they could prove any commercially viable mineral resources. They all came back empty-handed after a few years, but they were really optimistic because Russia had done the surveying. The Canadian companies thought they just needed to do the work on the ground,” Ritter went on. It turned out that things weren’t so simple.

Other Canadian enterprises went there, but few were successful, noted Ritter. “There were Canadian hotels that pulled out. There was interest in time-share condominiums, and the Cubans changed their mind on that, so that did not go forward. More recently, in the late 2000s, a number of Canadian enterprises made arrangements to invest fairly massive amounts of money in golf courses and related resorts. But those have been put back on the shelf; nothing has happened. I think the Cubans changed their minds [about that],” lamented Ritter. Overall, “The rules have been so fuzzy that every decision is sort of a customized ad hoc decision. The rules of the game come down to case by case decisions by Cubans.”

The only major Canadian firm to enjoy enduring success was Toronto-based Sherritt International, a resource company with interests in nickel and cobalt mining, oil and gas exploration and production, and electricity generation. Ritter said that Sherritt has been “wildly successful for Cuba and for Sherritt.” However, Sherritt’s huge success has not been repeated by other Canadian firms in the Cuban energy sector. In 2009, Pebercan, Inc., a Montreal-based oil producer, was notified by the Cuban government that it would scrap its production-sharing contract with the Canadian firm. That contract, signed by Pebercan and the Cuban government in 1993, had been scheduled to expire in 2018. Neither party to the contract ever announced any reason for the government’s decision to cancel it.

Goodwill is like an isotope that is trickling down

George Petrolekas, a former Marketing Director of a Canadian telecom, who has traveled on business in Cuba, said that former Prime Minister Stephen Harper’s conservative government “has been less receptive to links with Cuba than previous governments, which were Liberal.” During the late 1990s, “The most receptive Canadian governments were probably those of Pierre Elliott Trudeau, and Jean Chretien, to a lesser extent.” Petrolekas said that Harper has been “far harder on Cuba” than other Prime Ministers, such as Brian Mulroney.

Entwistle argues that even under left-leaning Canadian Prime Ministers, Canada has not taken full advantage of existing opportunities to promote Canadian corporate exporters and investors. “Truth be told, no Canadian government of any political stripe has exercised the full weight of instruments available to it for things like trade promotion.” Entwistle believes that Export Development Canada (EDC), which provides Canadian exporters with financing, has “never been overly active in Cuba, in terms of supporting Canadian business. Canadian business has done its own thing in Cuba, regardless of the government.”

Nor have there been a sufficient number of high-level visitors from Ottawa, waving the Canadian flag to drum up new business. Entwistle said, “There have been some political visits; Pierre Trudeau came in 1976; he was the first NATO-member state leader to do so. [Jean] Chretien also went—partly because Trudeau went.” Would it help if the next Canadian Prime Minister paid such a visit? “Hypothetically, if you had a Liberal government, there would be some explosion of activity on the part of the government of Canada in pursuing its relationship; but I think it will probably be business as usual. No government does tremendous damage to the relationship because it does tend to have its own rhythm, and you have this huge number of Canadians who go as tourists; well over a million a year.”

The sluggishness of the relationship defies the rosy expectations of earlier generations of Canadian business leaders. “At least one generation of Canadians in public life always believed that Canada had a special relationship with Cuba,” Entwistle continued. There was an assumption that “this relationship would translate into some sort of privileged access; an ability to leverage the relationship; to acquire things or positions – decisions from the government of Cuba that we want to see. The whole Canadian foreign policy establishment believed that for a long time.”

This presumption of privileged access has turned out to be false, said Entwistle. “While Cubans are very respectful of Canada and they value the relationship very much, we don’t have any special access or privileges in Cuba. We’re in competition with everyone else; you have to earn your keep; earn your way.” Ritter agreed that “Canadians had said for so long that we had built up a lot of goodwill in Cuba – and that it would pay off in the future.” Not true. And yet as early as 2002, when President George W. Bush enabled U.S. exports of pharmaceuticals and foodstuffs to Cuba, Canadians were disappointed with the reaction of their Cuban customers. As soon as lower-priced food became available from the United States, the Cubans switched to it, despite the ongoing U.S. trade embargo in other product sectors. Canada’s business activity in Cuba has been further hampered by the Helms-Burton Act of 1996, which penalizes all foreign companies that do business in Cuba by preventing them from doing business legally in the United States.

Reviving the special relationship

Overall, argued Entwistle, “Canada has an asset that has been created by the 70 years of unbroken ties, but it is being squandered. The goodwill of the relationship on which Canada dined out for a long time is like an isotope with a half-life. It is trickling down and has not been replenished sufficiently. ”

What measures would Entwistle take with respect to Cuba if he were Prime Minister of Canada? First of all, “I would increase the number of political visits at the ministerial level. In a country like Cuba, those kinds of visits, led by [cabinet level] ministers have real value. They signify the importance of the relationship; they provide entrée and access to senior decision makers in the Cuban government. [Canada’s] global competitors have been very active in this. “

In the wake of the normalization of U.S. diplomatic ties with Cuba, senior ministers from several major trading nations have descended on Havana in recent months, accompanied by senior executives from major corporations headquartered in those countries. For example, the President of France brought some 70 French companies; the Spanish prime minister, almost the same number; and likewise from Mexico and elsewhere. Meanwhile, Canadian leadership have undertaken no such large-scale missions in Cuba, of late, perhaps out of a sense that such missions are not necessary, given the decades of mutual goodwill. Despite Canada’s world-famous expertise in telecommunications, Orange S.A., the French telecom company, signed a deal to assist in the development of Cuba’s (government monopoly) telephone network in July 2014. “It’s the kind of deal we could have done, but we just didn’t bother to go there and do it,” Entwistle said.

What role can Canadians play in the Cuba of the future?

The Cuban government has outlined the important role to be played by foreign investment flows in the sustainable development of the country. In 2014, Cuba’s minister for foreign trade and investment said on state TV that the country needs a sufficient volume of foreign capital in order to achieve its economic growth target of 7 per cent a year. Its goal is attract $2 billion to $2.5 billion in foreign direct investments each year, notes Philip Peters, President of the Cuba Research Center. Peters says that target is “pretty ambitious,” given the fact during the entire 1990s, Cuba managed to attract a total of only $4 billion to $5 billion in inward foreign investment.

What will that expansion mean for Canadians? Economist Ritter believes that there are two ways of looking at the ultimate impact of the arrival of so many Americans on Cuban soil. One of those ways is positive; the other is negative. “There will be two kinds of effect. One will be a squeezing out effect in some areas. But there isn’t that much to be squeezed out, so I don’t think we lose so much,” added Ritter, in terms of current Canadian market share in Cuba; given the limited range of Canadian success stories in the world of industry.

When it comes to the tourism sector, there is a divergence of views. Ritter said that “a second squeezing-out effect will take place in the tourism industry, as the tsunami of tourists arrives from the United States. They could squeeze out a lot of Canadians,” given the fact that the typical Canadian tourist in Cuba has a more modest budget than his or her counterpart from the United States. Other analysts, including Entwistle, believe that there will be plenty of room in Cuba – the largest island in the Caribbean – for tourists traveling on all kinds of budgets, from modest cottages suitable for hippies to jet-set plutocrats. The key is to build the infrastructure that supports that expansion for all segments of the market. That’s an area where Canada can fill the gap with additional capital.

A range of enticing new opportunities may open for Canadians to export to Cuba and invest in that country, in partnership with Americans and other newcomers to the island. If the newly pragmatic Cuban government is as transparent as optimists say it will be, Canadians will be making more money in Cuba even if they wind up owning a smaller share of a much larger Cuban pie. Some Canadian companies could play a key role as intermediaries; consultants who advise and partner with U.S. companies that don’t already know Cuba the way a handful of Canadians know it. Apart from their greater familiarity with Cuba, argues Petrolekas, Canadians have this advantage: “There is not a sense that we [Canadians] are there to exploit Cubans. They like us from that standpoint. There are enough companies that operate cross-border between the U.S. and Canada, and we can certainly assist in that.”

How Canadians can improve their chances of success in Cuba

What steps can Canadians take to improve their chances of success? Entwistle notes that “the trick to improving your chances in Cuba is to align [your initiatives] with the Cuban government’s priorities, which have more to do with the real, basic economy than with the bells and whistles of advanced high-technology [economies]. The Cubans are remarkably smart. They have a home-grown leadership that is very serious, very earnest, analytical and methodical.”

Entwistle advises Canadians to study the priorities outlined in the 2014 foreign investment law, which target agricultural development; basic manufacturing, including such substitutes for imports as glass bottles and aluminum cans; and renewable energy, including wind power. In the past, Cuba has benefitted from low-priced, subsidized energy imports from Venezuela, but that country has been suffering economic and political disarray. That makes it riskier than ever for Cuba to depend on Venezuela for low-priced energy imports in the future, industry analysts agree. Another Cuban priority is biotechnology: Close to a dozen biotech institutes have been built in Cuba; meanwhile, Novartis and AstraZeneca – two European pharma companies – have a significant presence in the country.

Tourism remains particularly enticing. Cuba is looking for foreign partners to expand its hotel sector infrastructure quickly, in preparation for the huge flood of American tourists. Canadians may also be able to leverage growing demand for ‘medical tourism,’ which could develop into a huge source of revenue for the island, and for joint-venture partners from capitalist countries. World-famous for its quality, the Cuban medical system is offering medical services for Canadians via Health Services International (Servimed), an agency officially recognized by Cuba’s national medical system. Demand for such services is expected to grow, as well, in the United States, once full trade relations are normalized.

In conclusion, cautions Entwistle, “Cuba is not an economy that is for profiteering in any way; or for get-rich schemes, or getting in and out. This is a long-haul, strategic, patient market that is evolving in front of our eyes; at a very Cuban pace. You need a longer term vision. The companies that have been successful in Cuba have that long term vision, which allows them to ride the fluctuations of the daily ups and downs of doing the actual business. My advice is do less pitching and more listening. And if your business is in areas that are Cuba’s priorities, then you have a real good chance.” If he’s right, Canadians’ cultural aversion to flashy, get-rich-quick salesmanship could work out to their advanta

 

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CANADIAN CEO RETURNS HOME AFTER IMPRISONMENT IN CUBA

DANIEL TROTTA

HAVANA — Reuters; , Feb. 21 2015, 2:00 PM EST

Original here: http://www.theglobeandmail.com/news/national/canadian-ceo-returns-home-after-imprisonment-in-cuba/article23139650/

 Cuba has freed Canadian businessman Cy Tokmakjian after more than three years in jail, his company said on Saturday, resolving a case that had strained Cuban-Canadian relations and alarmed foreign investors.

Tokmakjian, founder of the Ontario-based company, was convicted of bribery and other charges and sentenced to 15 years in September in what the transportation company had called a “show trial” and a “travesty of justice.”

Cuban prosecutors had outlined a pattern in which Tokmakjian wooed Cuban officials and their families with a series of gifts, helping the Tokmakjian Group do business estimated at $80 million annually with Cuba until the company was shuttered and its founder arrested in September 2011.

Tokmakjian “was welcomed home by his family, friends, and thousands of employees,” said the company statement, which also thanked the Canadian government. A spokesman said the 74-year-old was released early Saturday.

The statement made no mention of two Canadian aides from the Tokmakjian Group, Claudio Vetere and Marco Puche, who were also convicted and sentenced to 12 and 8 years. They had been under house arrest pending trial and while their convictions were being appealed.

Fourteen Cubans including the former deputy sugar minister and the former director of the state nickel company were also convicted and sentenced to terms ranging from 6 to 20 years.

Foreign companies and diplomats had raised concerns that Tokmakjian’s case could scare off investors while Cuba was actively seeking foreign capital. It also annoyed Canada, a major trading partner.

“His ordeal is a cautionary tale to any investor who thinks the Cuban playing field is level,” said Peter Kent, Tokmakjian’s member of parliament.

Cuba seized about $100 million worth of company assets including bank accounts, inventory and office supplies, a ruling the company was challenging in international arbitration.

No immediate reason was given for the sudden release of Tokmakjian, whom Cuba had previously hailed as a model business partner over 20 years for supplying crucial transportation equipment during a severe economic crisis after the collapse of the Soviet Union.

The company was later caught up in an investigation of Cuba’s international trading sector, part of a crackdown on corruption.

cy7Cy Tokmakjian

Throughout the time Tokmakjian was tried in June and sentenced in September, the Canadian government was helping the United States and Cuba by serving as host to secret talks on restoring diplomatic ties.

It was unknown whether Canada’s role had any influence on Tokmakjian’s release.

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CANADIANS SUDDENLY RACING NOT TO SQUANDER HEAD START IN CUBA

Peter Kuitenbrouwer | January 30, 2015, Financial Post

Original here: Canadians Suddenly Racing

Mark Entwistle could not resist a smile at lunch time Tuesday as he gazed out over a packed room at Gowlings’ head office in Toronto’s First Canadian Place office tower. He had not seen some of these lawyers and business leaders in many years.

“In the mid 1990s, after the fall of the Soviet Union, Cuba was the new frontier,” Mr. Entwisle, Canada’s ambassador to Cuba from 1993 to 1997, recalls in a later interview. “We had almost an invasion of junior Canadian mining companies. We were doing all kinds of deals. Then Cuba stopped experimenting as much with foreign investment. Bre-X happened on the mining side, and all the juniors left because the money dried up.” The U.S. Helms Burton Act of 1996, which penalized foreign (such as Canadian) companies trading with Cuba, also scared companies off.

The world shifted again Dec. 17, when Raúl Castro, president of Cuba, and Barack Obama, president of the United States, restored diplomatic relations after 55 years. On Bay Street, Cuba is sexy again.

“You can tell Cuba’s kind of moved its way up the food chain,” Mr. Entwistle joked to the assembled at the Gowlings lunch, “The new Cuba equation: the Cuban economy, Canada’s opportunity and America’s new place,” organized by the Canadian Council for the Americas. A think tank with a 40-year history, the council holds events to discuss politics and business in the Western Hemisphere.

On the surface this interest in Cuba seems paradoxical. Canada never broke diplomatic relations with Cuba after its revolution in 1959, and Canadians have longstanding and deep connections with Cuba, as tourists and as investors. Why show interest in Cuba now that the U.S. is thawing relations? To some extent, with the exception of Sherritt International Corp. — which generates about 75% of its income from nickel it mines in Cuba — Canada has squandered its opportunity to solidify its place as the premier business partner with Cuba during the many years when U.S. policy froze out American companies. But that is just half the story.

Cuba has been reluctant to let anyone invest very much in its economy; foreign direct investment in Cuba is less than a tenth of 1% of gross domestic product. That policy of going it alone has kept out many Canadians, too. U.S. laws have also frightened off Canadians. Now, with Cuba and the U.S. playing footsie, investors sense that Cuba may be opening up more generally, offering renewed opportunities for Canadians, who already know Cuba well, to make some money.

“The interest is rising again, getting back on the radar screens where it had been off,” Mr. Entwistle says, sipping an espresso macchiato in Nespresso, a grand coffee shop near his office that feels more like a Mercedes dealership. He arrived home from Havana on the very day of the US-Cuba deal. “I got off the plane on Dec. 17, my BlackBerry was exploding with stuff,” he says.

 TORONTO, ONTARIO: JANUARY 29, 2015--FOREIGN--Former Canadian ambassador to Cuba Mark Entwistle spoke with Financial Post reporter Peter Kuitenbrouwer at Toronto's Nespresso Cafe, Thursday January 29, 2015. Entwistle is now active in advising Canadian companies who may wish to invest in Cuba. [Peter J. Thompson/National Post]    [For Financial Post story by Peter Kuitenbrouwer/Financial Post]  //NATIONAL POST STAFF PHOTO fp013115-pes-cuba

Mark Entwistle

Mr. Entwistle has teamed up with Belinda Stronach, the former MP and Magna International Inc. executive, and Anthony Melman, a former managing director at Onex Corp., among others, to form a boutique merchant bank, Acasta Capital. One investment that interests the firm: Cuba. In the past month Americans have started calling him, seeking his advice on investing in Cuba, he says.

At the Cuba lunch, Mr. Entwistle warned Canadians not to be smug about their connection to that country.

“There is this mythology that we have a special influence with the Cuban government. That does not give Canada a free ride in Cuba. Cuba is already a bustling, crowded place. Canadians will have to compete head-on.” Despite Canada’s world-class expertise in telecom, he noted, Orange SA, the French telecom company active across Europe and Africa, recently signed a deal to help Cuba’s telephone system. “It’s the kind of deal we could have done,” he says. “We just didn’t bother to go there and do it.”

And there was one consensus in the room: Cuba is poised for takeoff. Juan Triana Cordoví, an economist at the University of Havana, spelled out the potential of his country. Cuba’s health care system is among the best in the Americas; its infant mortality rate is below that of the United States. Of its 10.5 million people, 11% have a university education. Cuba has 14 universities. At the same time, he did not seem overly optimistic about the possibility of more foreign investment. Mr. Triana also noted the impressive bond between Cuba and Canada: 1.2 million Canadians visited Cuba in 2014, compared with just 90,000 Americans.

 “That was one of the best things about Cuba,” a lawyer at the lunch in Toronto remarked ruefully. “No Americans.”

Now the Yanks are coming. By one estimate, with the Obama administration relaxing rules on travel, a half-million Americans will visit Cuba this year. “Too many Americans in Cuba,” one Cuban remarked at the lunch.

The Canadian Council for the Americas brought the same panel to a Wednesday event at the Borden, Ladner Gervais law firm in Ottawa. Diplomats from Switzerland, Indonesia, Korea and the Dominican Republic attended. Ken Frankel, who runs the Canadian Council for the Americas out of Washington, D.C., says Canadians’ current interest in Cuba is partly motivated by fear. “Does this mean that U.S. business is going to flood into Cuba and push out the Canadians?” he asks.

Americans are certainly keenly interested. Devry Boughner Vorwerk, vice-president of legal affairs at Cargill, Inc., the agricultural giant, heads the U.S. Agricultural Coalition for Cuba, and spoke to the Toronto lunch from Washington via Skype.

Agriculture in Cuba has a lot of upside potential, thanks to rich soil and an educated workforce, experts agree. “You throw seeds in the ground and things grow,” says Mr. Entwistle. “You have a professional agronomist class.” However, historically Cuba has focused on growing sugar, and the country has little farm equipment. “Conceivably Cuba could become a major exporter of fruits and vegetables to the U.S.,” he suggests. “There is a perfect storm of untapped ingredients for agriculture.” Brazil has already begun to invest in agriculture in the island nation.

“I am working with people in agriculture,” Mr. Entwistle said, declining to name them. “I think it’s a big strategic sector for Canadian interests.”

Ricardo Alcolado Perez, who grew up in Cuba, runs his own law practice in Toronto and helps Canadian companies invest in Cuba. But many investors are gun shy. Historically, Cuba defaulted on some of its debts to Canadians, he says. U.S. laws pose another obstacle. It may seem odd, given the flood of Canadian tourists, that Canadians have not invested in hotels in Cuba, as the Spanish have. “The Four Seasons are not going to go to Cuba, over fear of losing business with the U.S. They also face the risk of being incarcerated,” he notes.

“I am working on a few projects,” Mr. Alcolado Perez adds. “One is a Canadian company who would like to raise funds in B.C. to build a hotel in Cuba.” He also has U.S. clients who do business in Cuba through Canadian firms. Information technology also offers opportunity, he adds.

“In the last 10 years Cuba has invested in training high-tech specialists. There are a lot of young guys who are very skilled,” says Mr. Alcolado Perez. “Already companies in Canada outsource software development to Cuba.”

In the last 10 years Cuba has invested in training high-tech specialists. There are a lot of young guys who are very skilled

Tom Timmins, a partner at Gowlings, heads the firm’s global renewable energy law practise. Like many Caribbean countries, Cuba produces electricity with generators powered by imported bunker oil, he says — even though wind energy costs 6.7¢ per kilowatt-hour, compared with up to 35¢ for diesel. Mr. Timmins is working with Carbon War Room, a charity founded by Richard Branson of the Virgin Group, to help Caribbean islands generate power from wind, solar and biomass.

“Cuba has a goal of 40% renewables and I think they will exceed that,” he says. “Because of [Ontario’s] feed-in tariff program, we’ve gotten really good at renewable energy and integrating it into the grid. A lot of the solar panels and wind turbines will be coming from China, but we can supply Canadian project developers, Canadian equity and Canadian debt.”

Cuba also has reserves in gold, silver, copper, other metals, as well as oil and gas.

Not much will change overnight, though. Polls show Americans favour lifting the U.S. embargo on trade with Cuba, but Mr. Obama, a Democrat, will face challenges getting a bill through the Republican-controlled Congress. And Cuba, concerned about social cohesion, will move cautiously to expand its small private sector.

Even so, the stars are aligning for major change in Cuba, and Canada will be there, says Mr. Entwistle.

“This not a hermit kingdom,” he says. “It is not an isolated place, but it’s one of the few markets around with a sense of untapped potential. There are a lot of ingredients for an economic takeoff in Cuba.”

Cuba Mar 2014 011 Cuba Mar 2014 042 Cuba Mar 2014 066

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CANADA’S INFLUENCE IN CUBA COULD WANE

by Dr. Peter McKenna

The Ottawa Citizen; Published on January 2, 2015

Original here: “Influence”

fidel castro3

It’s not surprising that Canadians were at the centre of trying to foster some sort of rapprochement between Washington and Havana. In fact, we’ve been trying to play the role of intermediary between the U.S. and Cuban governments for over 50 years.

Let’s remember that Canada has been viewed as a useful interlocutor because of our amicable relations with both Cuba and the United States. In short, we’ve had the crucial ingredient of trust in the eyes of the two governments.

According to some U.S. officials, Canada’s involvement in the most recent secret talks was nothing short of “indispensable.” We were undoubtedly the bridge that was needed to bring the two sides together.

As we look ahead, though, what will a U.S.-Cuba reconciliation mean for the future of Canada-Cuba relations? Will it weaken or strengthen the historical linkages between the two countries? Will we be able to use our uninterrupted relations with Cuba to gain special dispensation or favours from Havana going forward?

For the Cubans, Canada was one of only two countries in the Americas (the other being Mexico) not to sever diplomatic relations with Revolutionary Cuba in 1962. Since 1959, Canada has embraced a Cuba policy of dialogue, commercial exchange and principled engagement — which was highlighted by Prime Minister Pierre Trudeau’s 1976 visit to the country and Jean Chrétien’s difficult meetings in Havana with Fidel Castro in April of 1998.

Though relations between Canada and Cuba have not always been smooth or cordial (witness Ottawa’s refusal to invite Cuba to the Quebec City Summit of the Americas in 2001), neither side has deemed it necessary to shut down the channels of diplomatic communication. And the Cubans understand full well that the Canadians — who have been long-standing critics of the U.S. embargo against Cuba since the early 1960s — were not going to stab them in the back.

Canada, unlike the U.S., has been careful over the decades not to allow human rights considerations to impede bilateral relations with the Cubans. Official Ottawa has known for some time that hostility toward, and isolation of, Cuba has exhibited few tangible results.

castro_and_michelFidel with Margaret and Michel Trudeau, Michel not impressed!

For our American friends, we had “street cred” because Canadian officials in Cuba have been sharing with them intelligence on the country for over 50 years. They also knew that the Canadians have wanted the same things in Cuba as them since 1959 — political liberalization, respect for basic human rights and an open economy — while differing sharply on the means of securing those policy objectives.

It’s worth mentioning, though, that the normalization of U.S.-Cuban relations could have both positive and negative implications for Canada. We may very well benefit from seeing greater demand in Cuba for additional infrastructure projects (trading on our good name as long-time friends), investment opportunities in certain specialized sectors (like oil and mineral development along with financial and banking services) and from sharing Canadian expertise on tourism management.

But these recent developments could negatively impact Canada in terms of its own commercial relationship with Cuba (which exceeds $1 billion annually in two-way trade). While Canadian companies are highly regarded on the island, they could easily get squeezed out by their American competitors. As a result, we could eventually see a sharp decline in trade and investment dollars between Canada and Cuba.

In addition, a good part of Canada’s influence in Cuba is tied to Havana’s completely dysfunctional relationship with Washington. But as U.S.-Cuban relations take on greater importance, Canada’s leverage is likely to wane.

Still, this role of facilitator is precisely the kind of niche diplomacy that Canada should be conducting around the world — and thus Prime Minister Stephen Harper and Foreign Minister John Baird deserve a pat on the back. But we need to be vigilant here about making sure that both Havana and Washington don’t allow the enemies of normalization, and there are many, to undermine our outstanding efforts to date.

Peter McKenna is professor and chair of political science at the University of Prince Edward Island and the co-author of Canada-Cuba Relations: The Other Good Neighbor Policy.

UN-MILLENNIUM SUMMIT-CANADA/CUBA Fidel, perhaps listening?

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CANADIAN EXPAT TELLS OF CUBA’S EUPHORIA AFTER U.S. ‘GAME CHANGER’

TAVIA GRANT

The Globe and Mail, Friday, Dec. 19 2014, 8:03 PM EST

Original article: EUPHORIA

This week is not one Gregory Biniowsky will ever forget. The Canadian lawyer has lived in Havana for 23 years, a place where hope has regularly ebbed and flowed on expectations the United States would restore relations with the Caribbean island.

Change was always just around the corner. But it never materialized. Until Wednesday.

It was an “enormous” surprise when President Barack Obama announced the United States would normalize relations with Cuba, Mr. Biniowsky said.

Outside his home in Old Havana, church bells rang out and people cheered as Cuban President Raul Castro made his own simultaneous live broadcast confirming that three of the famed Cuban Five prisoners were released and that the two countries will renew diplomatic relations after 53 years of hostility.

Friends celebrated, some wept. Mr. Biniowsky described the mood in Cuba as euphoric.

The significance of the dramatic announcement go beyond relations between the U.S. and its much smaller next-door neighbour. Smoothing ties with Cuba will improve U.S. ties with Latin America as a whole, a region that long urged the U.S. to end its trade embargo. And it will have ripple effects on Canada’s long-standing relationship with the island, opening up both business opportunities and more competition, along with big changes in a favoured Canadian holiday destination.

“Across the political spectrum, from stalwart supporters of the Cuban revolution to intelligent opponents of the system, everybody is very happy,” Mr. Biniowsky said in a phone interview. “It’s not difficult to pick up on the extreme significance of it.”

The prospect of a lifting of the U.S. embargo on Cuba, he added, is a “game changer.”

Most poignant of all for him was hearing that Canada played a role in the fence-mending by hosting most of the secret talks over the past 18 months.

“Our government, regardless of who’s in power, has maintained a really honourable, constructive, intelligent policy towards Cuba. And the Cubans know that,” said Mr. Biniowsky, an international consultant who has advised the Canadian embassy and the United Nations in areas such as business, investment and social-impact projects.

The news made him “proud to be a Canadian,” he says, for “staying true to the tradition of being an honest broker.”

 cuba-main19nw2

U.S. and Cuban flags hang from a balcony in Old Havana yesterday. ‘Everybody is very happy,’ said Canadian expat Gregory Biniowsky.

While it will take congressional approval to end the trade embargo, Mr. Obama is pulling all the levers at his disposal to free aspects of trade and travel, including – in a key confidence-building move for foreign investors – plans to take Cuba off the U.S. list of state sponsors of terrorism.

International visitors, many of them Canadian, certainly love cheap vacations and the charm of a place where time seems to have stood still, a country free of malls and McDonald’s, where 1950s cars still cruise and Internet access is sparse and roads are still potholed.

But the reality is that Cuba’s economy is stuck. It’s hard to aspire to a better life in a country with little access to credit, convertible currencies and foreign investment. Foreign investors have shied away from the communist-run nation, not just because of its red tape, one-side legal dispute system and state-heavy approach but also for fear of U.S. reprisals. This has made it difficult to, for example, expand ports and roads or improve obsolete industrial plants or telecommunications services.

“It creates a condition of a country that can’t grow, because everything grows on credit and investment,” said Julia Sagebien, associate professor at Dalhousie University who was born in Cuba and has studied the island’s economy since 1994. She said she is “extraordinarily happy” over the changes. On her last trip in May, after four years of advising Cuba on economic reform and areas such as social enterprises and Canadian co-operative models, she was set to throw in the towel. The economy was “starting to freeze again,” she said, and only the lifting of the embargo could really get it going. Now “the patient in the coma has finally woken up,” she said. “The real rehabilitation comes now.”

Cuba is an attractive market. It’s the biggest island in the Caribbean with the largest population, at 11.2 million people. It has fertile land, a growing bio-pharma industry, thousands of new micro-enterprises and miles of beaches. And Cubans are justifiably proud of the country’s achievements with a well-educated population, long life expectancy and low crime rates. The huge income disparities visible through much of Latin America are absent in Cuba, though that has started to change with shifts in the economy, meagre public-sector wages and the growth of private businesses such as hair salons and cellphone repair shops.

Prof. Sagebien sees opportunities for Canadians – particularly in the next year before U.S. investors move in – in sectors such as infrastructure, agricultural inputs like fertilizer, equipment and parts, paper pulp, energy, mining, commercial banking and tourism. (Most U.S. citizens will still be prohibited from visiting Cuba, unless they have Cuban relatives or fit other categories including education and humanitarian workers.)

Canada and Cuba have long and colourful history. Relations date to the 1700s, when Atlantic schooners traded salt cod and potatoes for rum and sugar. Cuba was the first country in the Caribbean where Canada established a diplomatic mission and official relations began in 1945, according to the federal government’s website. Canada and Mexico were the only two countries in the hemisphere that never broke trade relations with the island. Former prime minister Pierre Trudeau struck a friendship with Fidel Castro and visited the nation in 1976. Cuba’s annual Terry Fox Run has become the world’s largest outside of Canada. The two countries retain close academic ties. And Cuba is among the top three destinations for Canadian tourists. Canada is, by far, Cuba’s largest source of tourists with more than a million visitors a year.

Mr. Biniowsky figures the U.S. will lift the travel ban ahead of the trade embargo, which could in turn double the number of tourists to the island to about six million people. That will juice the economy. And, he added, “who is going to be doing all the airport expansions, marinas, hotels and infrastructure? Well, Canadians, Europeans, Latin Americans, everyone else except for the United States. So we’ll have an interesting situation where the Cuban economy will begin to really heat up before the embargo is lifted because the travel ban will have been lifted.”

The Canadian tourism industry already sees a pick up in business in year ahead. Cuba Cruise, a new Canadian company that runs cruises that circle the island, and aim to give visitors a sense of the “Real Cuba,” said it expects increased bookings in the short term from international travellers. “eager to explore a country that is virtually free of American commercialization and chock full with charm before it might change.”

Once big U.S. cruise companies and tour operators jockey their way into the island, the picture is less clear, according to Dugald Wells, president and chief executive of Cuba Cruise. “What the competitive landscape is going to look like a year from now, that’s up to the politicians,” he said, adding that it’s with a bit of trepidation that we go forward.”

“There’s change in the air,” said Mr. Biniowsky. He cautioned that Cuba is not the easiest place to do business, but that it holds much promise. Canadians “need to get in now, position ourselves, create relations with the Cubans now, because the clock is really beginning to tick.”

He is optimistic about the future – even though it may mean growing throngs outside his house. “It will be a bit too touristy for me, and Cuba will lose a bit of its charm, because part of its charm is the lack of massive amounts of tourists. I don’t think Cubans are ready because of their infrastructure … so it’s going to be maybe a bit of a rough transition. But it’s good for the country, it’s hard currency for them.

“Let’s see how the Cubans manage – hopeful there won’t be a McDonald’s in old Havana, but we’ll see.”

grec

Gregory Biniowsky

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Sagebien & Spadoni: TWO ARTICLES ON THE IMPACTS OF US-CUBA NORMALIZATION ON CANADAIAN BUSINESS WITH CUBA

Below are links to two articles by Julia Sagebien and Paulo Spadoni on the impacts of US-Cuba normalization on Canadian business relations with Cuba.

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O CANADA, WILL CUBA STAND ON GUARD FOR THEE? PREPARING FOR THE END OF THE US EMBARGO ON CUBA       

       Attachment Here: SagebienSpadoni TIBR

 New Picture (1)

WILL THEY STILL LOVE US TOMORROW? CANADA-CUBA BUSINESS RELATIONS AND THE END OF THE CUBAN EMBARGO

Attachment here: SagebienSpadoni CanadaCuba Ivey

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RECIPROCITY AND RENT-SEEKING: A STUDY OF THE PARTNERSHIP APPROACH TO DEVELOPMENT ASSISTANCE (A Canada-Cuba Case Analysis)

[I just stumbled again upon this excellent analysis of the Carleton University- Universidad de la Habana Partnership program of 1995-2002, written by my colleague Frances Woolley. It is of broad interest to those interested in development assistance generally and of particular interest to those interested in Cuba. It is a fine article that seems to have slipped under the radar of many analysts of Cuba. I am therefore publishing it again here.  A.R.]

Canadian Journal of Development Studies / Revue canadienne d’études du développement , Volume 23, Issue 2, 2002

Dr. Frances Woolley,  Department of Economics and Associate Dean, Faculty of Public Affairs, Carleton University, Canada

Complete article available here: Frances Woolley, Cuba-Canada Reciprocityand Rent-Seeking 2002 CJDSABSTRACT Under the partnership approach to development assistance, donor agencies fund partnerships between donor-country and host-country institutions. This paper develops a model of development assistance in which project participants attempt to extract rents from donor agencies. The model is applied to an academic exchange between Carleton University and the University of Havana. The behaviour of project participants is rational given the constraints and incentives they face, yet individually rational responses can undermine collective reciprocity and jeopardize both partners’ goals for development assistance. The paper concludes that structural and ideological issues may be easier to account for than personal needs and power.

New Picture (1)untitledFrances Woolley

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WHAT SHOULD CANADA DO ABOUT CUBA’S PARTICIPATION IN THE AMERICAS SUMMIT?

CIPS-logo2By Stephen Baranyi, Professor, School of International Development and Global Studies, University of Ottawa, and Chair, Latin America and Caribbean Study Group of the Canadian International Council’s National Capital Branch.

See the original at: http://cips.uottawa.ca/what-should-canada-do-about-cubas-participation-in-the-americas-summit/#sthash.RUA0hXpt.dpuf This commentary reflects the public remarks and off-the-record

discussion with officials at the forum on Cuba, the 2015 Americas Summit, and Beyond: Obstacles and Opportunities, which was co-sponsored by CIPS on September 4, 2014.

Most Latin American and Caribbean states have indicated they will not attend the Americas Summit planned by Panama for April 2015 unless Cuba is invited. Canada and the United States have expressed reservations about Cuba’s participation on the grounds that it would gravely weaken the Inter-American Democratic Charter. Yet neither Ottawa nor Washington can afford to see the summit fail. In an age of emerging regional powers and increasing involvement by external heavyweights like China, North Americans are rightly concerned about being left on the margins of new hemispheric relationships.

From the moment it joined the OAS in 1989, Canada has made the protection and promotion of democracy a cornerstone of its hemispheric engagement. This commitment informed Canada’s hosting of the Americas Summit in Quebec and engagement in helping negotiate the Inter-American Democratic Charter, as well as the Harper government’s current Americas Strategy. Ottawa played a key role in drafting the Democracy Clause of the Quebec Declaration, which states that

 “any unconstitutional alteration or interruption of the democratic order in a state of the hemisphere constitutes an insurmountable obstacle to the participation of that state’s government in the Summits of the Americas process.”

Recognition of the different and often difficult paths to democracy provides an opening for productive dialogue, even between ideological foes, on ways of assisting Cuba in its construction of more democratic institutions. While Ottawa has maintained respectful relations with Havana since 1959, it definitely sees the Cuban regime as not meeting the standards of liberal democracy codified in the Democratic Charter. On that basis, it is understandable that Ottawa does not favour moves that might lower the bar on democracy in the region—at the summit or in other Inter-American fora.

Yet Canada does not wish to be left out in the cold, especially if Washington decides to go along with the majority view on Cuba’s participation. The Inter-American system, with the OAS at its centre, remains important because those are the only hemispheric institutions which include Canada as a full member (unlike the new Latin American and Caribbean Community (CELAC). Saving the Americas Summit is thus part of safeguarding Canada’s presence in the hemisphere. The tricky part is finding a way to save the summit and enabling Cuba to participate, without compromising Charter norms.

How might Canada contribute to that outcome?

First, Ottawa could see Cuba’s participation in the Americas Summit as a confidence-building measure rather than as a clear dilution of Inter-American democratic norms. Cuba’s participation in the Panama Summit would move it further along the path to reincorporation opened up at the San Pedro Sula General Assembly of the OAS in 2009. Yet it would not nullify the need for many other steps, by Havana and others, before Cuba could become a full member of the Inter-American system. As such, for Canada there would be little cost (and some possible benefits) in accepting Cuba’s participation in the Panama Summit.

Second, Ottawa could quietly support the construction of a summit agenda around a less controversial theme, such as the cooperative management of migration flows. Panama is not the place to reopen the Democratic Charter, with Cuba in the spotlight. Yet Ottawa could support a lower-profile discussion elsewhere on ways of breathing fresh life into the Charter.

The publications around the 10th anniversary of the Charter in 2011 (including the work of Canadian scholars like Maxwell Cameron and Thomas Legler) generated many ideas for strengthening the application of the Charter. Those range from compendia of best practices to the establishment of a special rapporteur on democracy. That conversation might interest Cuba and its allies, if it is broadened to include a consideration of how the participatory and substantive dimensions of democracy could be enhanced—as a complement to the mostly liberal, procedural dimensions codified in the Charter. This is complex and it will take time, much longer than the months leading up to the Panama Summit.

It will require adaptation in Cuba but also a considerable degree of conceptual and operational innovation on the OAS side. For those who think that the Harper government is unlikely to support that approach, let me cite the words of Foreign Minister Baird at the OAS General Assembly a few months ago. “Democracy”, he noted in Asunción, “is a journey, not a destination. There is no single outcome. Every democracy will look a little different, coming from a different set of experiences and from a different journey.”

This recognition of the different and often difficult paths to democracy provides an opening for productive dialogue, even between ideological foes, on ways of assisting Cuba in its construction of more democratic institutions. That could be timely, given the creation of the Department of Foreign Affairs, Trade and Development (DFATD), which merges the democracy promotion and development mandates into one department.

Finally (and probably also quietly, since Ottawa has learned that megaphone diplomacy does not work on this file), Canada could continue supporting home-grown democratic development through technical cooperation with Cuban institutions. This could be done by supporting greater citizen participation in municipal governance; funding Cuban (quasi) civil society organizations working to enhance tolerance of diversity and the peaceful management of disputes; and backing Cuban researchers exploring ways to promote more governmental accountability.

Several Canadian non-governmental organizations are already engaged in such initiatives. More could be done to expand those efforts over the coming years, on the safe assumption that they will converge with internal processes such as generational change, as well as with the renewal of democratic norms in hemispheric fora.

See more at: http://cips.uottawa.ca/what-should-canada-do-about-cubas-participation-in-the-americas-summit/#sthash.TO8hwHTb.dpuf

000477_baranyi1-e1365429847141Stephen Baranyi

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