Tag Archives: US-Cuba Normalization

WHY REPUBLICAN CRITIQUES OF OBAMA’S APPROACH TO HUMAN RIGHTS IN CUBA ARE WRONG

New York Times, MARCH 2, 2016

By WILLIAM M. LEOGRANDE

Original Essay: Obama’s Long Game for Cubans’ Rights

WASHINGTON — President Obama’s announcement that he will visit Cuba this month has prompted a new round of criticism from opponents of normalizing relations. Their complaint: that the administration’s opening to Cuba has yet to yield any tangible progress on human rights.

“I think the president ought to be pushing for a free Cuba” instead of going there, said one Republican presidential hopeful, Senator Ted Cruz of Texas. Senator Marco Rubio of Florida, Mr. Cruz’s rival, echoed the theme: “A year and two months after the opening of Cuba, the Cuban government remains as oppressive as ever.” The United States, such critics argue, should insist on human rights concessions in exchange for normalization.

Election year hyperbole aside, this argument sounds compelling because it appeals to core American values of democracy and human rights. But the critics have it backward: Mr. Obama has not given up on human rights in order to pursue normalization; he is pursuing normalization as a path to improving human rights. Nor is this a particularly new or exotic strategy; it’s been American policy toward China since President Richard Nixon’s trip to Beijing in 1972.

As President Obama said when he announced the opening to Cuba on Dec. 17, 2014, he chose engagement because the old policy of trying to coerce concessions from Havana had failed. If anything, it made things worse by giving the Cuban government a convenient enemy to blame for its problems and a ready excuse to suppress dissent.

Mr. Obama’s strategy is more subtle. He aims to weave a web of economic and diplomatic ties that create self-interested reasons for Cuban leaders to change. As the president explained to Yahoo News, “The more that they see the benefits of U.S. investment, the more that U.S. tourist dollars become woven into their economy, the more that telecommunications is opened up so that Cubans are getting information unfettered by censorship, the more you are laying the foundation for the bigger changes that are going to be coming over time.” In the meantime, he says, Washington will continue to “push, prod, nudge” Cuban leaders to do better on human rights in the near term.

While critics denounce engagement as a betrayal of the Cuban people, the Cuban people themselves overwhelmingly support it. Anyone who was in Cuba, as I was, on Dec. 17, 2014, can testify to the jubilation with which they greeted the announcement. People applauded, hugged one another and cried. Church bells rang across Havana.

In April 2015, an independent poll on the island found that 97 percent of the 1,200 Cubans sampled thought better relations with the United States would be good for Cuba. And lest anyone think people were afraid to speak honestly, the poll also found that Mr. Obama was more popular than either Fidel or Raúl Castro (80 percent positive and only 17 percent negative, as compared with 50 percent negative for Fidel and 48 percent negative for Raúl). Mr. Obama can expect a warm welcome in Havana.

To be sure, some prominent Cuban dissidents have criticized his approach. Jorge Luis García Pérez — also known as Antúnez — called the vision of promoting change through engagement “a farce promoted by the Castro regime in order to perpetuate itself in power.” The political activist Antonio Rodiles has argued that American sanctions failed because they were “anemically imposed.”

But the dissident community is not monolithic. Miriam Leiva, one of the founders of Ladies in White, a group of women related to jailed dissidents, applauded Mr. Obama’s policy as “a unique opportunity to assist the Cuban people.” Elizardo Sánchez, who founded the Cuban Committee for Human Rights and National Reconciliation and reports monthly about political arrests, also endorsed engagement, saying, “It’s better to resolve differences in this way, not to make war, either cold or hot.”

Engagement has already borne some fruit. Expanding commercial relations are reinforcing the economic liberalization that began in Cuba in 2011. Internet access is growing. Debate within Cuban civil society about the island’s economic and political future is more robust than ever. As Mr. Obama’s deputy national security adviser, Ben Rhodes, who negotiated the 2014 agreements, noted, “We see everything that we’re doing as being in the net positive for the lives and human rights of the Cuban people.”

Mr. Obama’s visit is an opportunity to strengthen diplomatic and commercial ties, and to directly raise the issue of human rights both publicly and privately. He plans to meet with a broad range of civil society leaders and with a group of dissidents, as Secretary of State John Kerry did on a visit last August. In his public address, President Obama will undoubtedly speak with eloquence about the virtues of democracy and human rights, as former President Jimmy Carter did on his 2002 trip.

In short, human rights has never been off the agenda of Mr. Obama’s Cuba policy, but experience has taught him that making imperious demands and issuing ultimatums did nothing to advance the cause. Instead, he is playing a long game, knowing that his strategy of engagement and persistent persuasion will not produce dramatic change overnight. Still, the president is gambling that his formula will create the conditions that draw Cuba inexorably toward a more open body politic and economy.

All gambles are uncertain, of course. But the president is on to something: Engagement has a better chance than the policy of hostility, which has been a losing bet for more than half a century.

William M. LeoGrande is a professor of government in the School of Public Affairs at American University in Washington, D.C., and a co-author, with Peter Kornbluh, of “Back Channel to Cuba: The Hidden History of Negotiations between Washington and Havana.”

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William M. LeoGrande

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WHY IS OBAMA VISITING CUBA?

KONRAD YAKABUSKI

The Globe and Mail, Thursday, Feb. 25, 2016

Original Article: Why is Obama visiting Cuba?

Only two months ago, U.S. President Barack Obama laid out the conditions under which he would visit Cuba before he leaves office. “If, in fact, I with confidence can say that we’re seeing some progress in the liberty and expression and possibilities of ordinary Cubans, I’d love to use a visit as a way of highlighting that progress,” he said on the first anniversary of his historic announcement of the renewal of U.S. diplomatic relations with the Communist holdout.

The world has become accustomed to Mr. Obama’s foreign policy flip-flops (see his “red line” in Syria) and desire to do away with the image of the United States as a meddling and moralizing superpower. But even critics of the five-decade U.S. policy of isolating the Castro regime were taken aback by news that Mr. Obama will next month become the first sitting president to visit to Cuba in 88 years.

In no material sense has Cuban President Raul Castro, who took over from his ailing brother Fidel in 2006, expanded the freedoms of ordinary citizens. Recent baby steps toward economic reform fit a pattern that seasoned Cuba watchers recognize all too well. The Castros are experts in diffusing the frustrations of average Cubans with their stultified economic conditions by offering up mini-reforms that, once the dust settles, never amount to much for average folk. Low expectations are now so integral to the Cuban condition that mere crumbs are welcomed.

There has been even less progress on human rights. Arbitrary arrests and detentions climbed steadily throughout 2015 and hit 1,474 people in January, according to the Cuban Observatory on Human Rights. Political repression has not eased. “The figures reflect only certain repressive actions, and therefore do not express all the violations of various human rights that occur in Cuba,” the Madrid-based organization noted. “But they serve to demonstrate the lack of political will to change on the part of the Cuban government, which remains stuck in intolerance and immobility.”

This has not stopped the Obama administration from unilaterally easing restrictions on Americans travelling to Cuba and sending remittances to relatives on the island. It has reopened the U.S. embassy in Havana and announced plans for the resumption of commercial flights to Cuba by U.S. airlines. (Congress, however, has no intention of lifting the U.S. trade embargo.)

Mr. Obama plans to meet with dissidents, but under what conditions remains to be seen. The visit will be covered by Cuba’s state-run media, which will showcase to Cubans their censored version of it. It is not Mr. Obama’s style to deliver a Reaganesque ultimatum on foreign soil. The President hopes to “nudge the Cuban government in a new direction.” Good luck with that.

The Castros have not held on to power for 57 years by taking friendly advice from neighbours on how to transition to democracy. If anything, Mr. Obama risks enhancing their legitimacy and strengthening their grip on the island’s economy. The Cuban military, also headed by Raul Castro, controls most of the economy (including its burgeoning tourist industry) and stands to benefit the most from increased U.S. trade and investment. The regime is desperate for hard currency, especially now that fast-spiralling Venezuela can no longer play Cuba’s benefactor.

Mr. Obama seeks to make his opening toward Cuba “irreversible” for a future president and prepare for a post-Castro Cuba. But it would be naive to believe the 84-year-old Raul, who plans to quit the presidency in 2018, has not planned for his succession. Many Cuban experts believe he has chosen 55-year-old Miguel Diaz-Canel Bermudez, a Communist hardliner and first vice-president of the Cuban Council of State, to succeed him as president. But the real post-Raul power may lie with his son and/or son-in-law; both are top military officials who run some of Cuba’s biggest businesses.

Supporters of Mr. Obama’s approach argue that human-rights violations and political repression have not stopped the United States from pursuing economic and diplomatic relations with China. So why apply a tougher standard to Cuba, especially when the United States continues to indefinitely detain and deprive of due process dozens of prisoners at Guantanamo Bay?

The answer is that Cuba is in North America’s backyard and the Castros head the longest-running dictatorship in the Western hemisphere. Their brutality is well documented, in spite of the romanticism with which Canadians often view them.

The world does not need more (of the Castros’) Cuba.

 

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OBAMA SEEKS TO IMPROVE LIVES OF CUBANS IN HISTORIC MARCH VISIT

The Globe and Mail, Feb. 17, 2016 9:34PM EST

By Josh Lederman and Kevin Freking

Original Article: HISTORIC VISIT

Barack Obama, Raul CastroPresident Barack Obama said Thursday his history-making visit to Cuba next month was part of an effort to “improve the lives of the Cuban people.” He vowed to press the communist government on human rights and other policy differences.

“We still have differences with the Cuban government that I will raise directly. America will always stand for human rights around the world,” Obama wrote, as he announced the visit on Twitter.

The trip will make Obama the first sitting U.S. president to set foot on the island in nearly seven decades. In a series of tweets, Obama cast it as part of steady progression of normalizing relations between the U.S. and Cuba, a communist nation estranged from the U.S. for over half a century until Obama and Cuban President Raul Castro moved toward rapprochement more than a year ago. Since then, the nations have reopened embassies in Washington and Havana, eased travel restrictions and barriers for business and have moved to restore commercial air travel. A presidential trip was held out as significant leverage in these talks.

“There is much more that can be done — by the United States, and by the Cuban government — to advance this opening in ways that will be good for Cubans and good for the United States. That is why President Obama is travelling to Cuba,” deputy national security adviser Ben Rhodes wrote Thursday in a post on Medium, a blogging website. “We want to open up more opportunities for U.S. businesses and travellers to engage with Cuba, and we want the Cuban government to open up more opportunities for its people to benefit from that engagement.”

Rhodes noted the ultimate aim is to persuade Congress to lift the trade embargo — an unlikely possibility in the near term.

In addition to meeting with Castro, Obama will interact with members of Cuban “civil society,” the White House said, referring to activists that advocate for various social causes. Prior to announcing the trip, Obama had said one of the conditions for a presidential visit would be the ability for him to speak to all kinds of groups — including those that oppose the Castro government.

Obama’s stop in Cuba will be part of a broader trip to Latin America that the president will take next month. From Cuba, Obama will travel to Argentina, where he’ll meet with the new president.

Word of his travel plans drew immediate resistance from opponents of warmer ties with Cuba — including Republican presidential candidates.

Texas Sen. Ted Cruz, whose father came to the U.S. from Cuba in the 1950s, said Obama shouldn’t visit while the Castro family remains in power. Florida Sen. Marco Rubio, another child of Cuban immigrants, lambasted the president for visiting what he called an “anti-American communist dictatorship.”

“Today, a year and two months after the opening of Cuba, the Cuban government remains as oppressive as ever,” Rubio said on CNN. Told of Obama’s intention to visit, he added, “Probably not going to invite me.”

With less than a year left in office, Obama has been eager to make rapid progress on restoring economic and diplomatic ties to cement warming relations with Cuba that his administration started. Following secret negotiations between their governments, Obama and Castro announced in late 2014 that they would begin normalizing ties, and months later held the first face-to-face meeting between an American and Cuban president since 1958.

But Obama, facing steadfast opposition to normalized relations from Republicans and some Democrats, has been unable to deliver on the former Cold War foe’s biggest request: the lifting of the U.S. economic embargo. Opponents argue that repealing those sanctions would reward a government still engaging in human rights abuses and stifling democratic aspirations.

Rep. Ileana Ros-Lehtinen, a Florida Republican born in Cuba, called the visit “absolutely shameful.”

“For more than 50 years, Cubans have been fleeing the Castro regime,” said Lehtinen, the longest-serving Cuban-American in Congress. “Yet the country which grants them refuge — the United States — has now decided to quite literally embrace their oppressors.”

Obama and supporters of the detente argue the decades-old embargo has failed to bring about desired change on the island 90 miles south of Florida. Still, while Obama has long expressed an interest in visiting Cuba, White House officials had said the visit wouldn’t occur unless and until the conditions were right.

“If I go on a visit, then part of the deal is that I get to talk to everybody” — including political dissidents, Obama told Yahoo News in December. “I’ve made very clear in my conversations directly with President Castro that we would continue to reach out to those who want to broaden the scope for, you know, free expression inside of Cuba.”

Officials didn’t immediately specify what had changed in the last few weeks to clear the way for the trip, first reported by ABC News. But on Tuesday, the two nations signed a deal restoring commercial air traffic as early as later this year, eliminating a key barrier to unfettered travel that isolated Cuban-Americans from their families for generations.

Hundreds of thousands more Americans are expected to visit Cuba per year under the deal, which cleared the way for the Transportation Department to open bidding by American air carriers on as many as 110 flights a day. Currently, there are about one-fifth as many flights operating between the two countries — all charters.

According to the State Department historian’s office, President Harry Truman visited the U.S.-controlled Guantanamo Bay and its naval base on the southeast end of the island in 1948 and former President Jimmy Carter has paid multiple visits to the island since leaving office in January 1981. Not since President Calvin Coolidge went to Havana in January 1928 has a sitting U.S. president been to that city.

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NEW TALKS BEGIN WITH CUBA ON EXPANDING BUSINESS TIES

New York Times, FEB. 17, 2016

By JULIE HIRSCHFELD DAVIS 

Original Article: Expanding Business Ties

WASHINGTON — Top Obama administration officials will open a round of talks on Wednesday in Washington aimed at expanding business ties between the United States and Cuba, pushing forward on President Obama’s directive to seek normalized relations, even while the American embargo continues to bar most trade and commerce between the two nations.  The regulatory discussions, to be hosted by Penny Pritzker, the commerce secretary, and attended by Cuban officials and their counterparts from the departments of Commerce, State and Treasury, come after the signing in Havana on Tuesday of an arrangement allowing scheduled direct flights between the United States and Cuba for the first time in decades.

American carriers can begin applying to the Department of Transportation to offer the service — up to 20 scheduled flights per day to Havana and 10 to each of nine other international airports in Cuba. The pact aims to substantially increase travel between the two countries, which are

But even as Mr. Obama makes progress in his drive to forge closer commercial ties with Cuba, the process is hamstrung by sanctions that have left American businesses wondering what they are permitted to do. Rodrigo Malmierca, the Cuban minister of trade and foreign investment, said on Tuesday that he had heard from many American companies that want to establish businesses in Cuba but are ensnared in regulatory limbo, awaiting special licenses from the United States government.

“The problem that we face today is that many companies want to do business, but we need to create the conditions for them to access the Cuban market,” Mr. Malmierca said in Washington at an event hosted by the U.S. Chamber of Commerce.  He repeatedly said that Cuba welcomed American investment and would not “discriminate” against United States companies. “Lifting the blockade is essential to advancing this,” he said.

With the Republican-controlled Congress unlikely to lift the embargo soon, Mr. Malmierca called on Mr. Obama to do more unilaterally, including allowing the dollar to be used in transactions with Cuba, lifting the ban against imports of top Cuban products like rum and cigars and ending the prohibition against direct investment in Cuba.

Critics argue that with each move to foster better relations and American investment, the president is rewarding a dictatorial government that infringes on human rights and squelches democratic discourse.  But Mr. Obama, who has said he wants to travel to Cuba before leaving office, has argued that the best way to put pressure on the Cuban government is to expose its citizens to American values and ideals and through diplomatic channels re-established last year when embassies reopened in Havana and Washington.

This week’s technical talks are the second time since Mr. Obama announced the opening with Cuba in December 2014 that Ms. Pritzker and Mr. Malmierca have come together with officials from their governments to try to work out the complex details of harmonizing some aspects of their business regulations. Ms. Pritzker traveled to Havana in October to begin the discussions, which have been made even more labyrinthine on the American side by the statutory embargo.

The Obama administration announced last month that it was relaxing more restrictions on business with Cuba, including allowing United States banks to provide direct financing for the export of any product other than agricultural commodities, which are still walled off under the embargo.

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CUBA’S FIRST U.S. FACTORY IN 56 YEARS

Forbes, Feb 16, 2016

Original Article : CUBA’S FIRST U.S. FACTORY

Susan Adams, Forbes Staff

Horace Clemmons and Saul Berenthal, both 72-year-old retired software engineers, are slated to become the first Americans since 1959 to set up a manufacturing plant in Cuba. Their plan: produce small, easily maintained tractors for use by family farmers. Under new regulations issued by the Obama administration, the U.S. Treasury Department’s Office of Foreign Assets Control gave the Paint Rock, AL-based partners the go-ahead last week. Once they get final approval from the Cubans, they anticipate that in early 2017, they’ll start building a factory in a special economic zone set up by the Cuban government in the port city of Mariel. In this condensed and edited interview, Berenthal describes his transition from software entrepreneur to Cuban manufacturing pioneer.

zzzxzzSusan Adams: Tell me about your personal connection to Cuba.

Saul Berenthal: I was born and raised in Cuba. I came to the U.S. in 1960 right after the revolution. First I came and then my parents. My family in Cuba is in the cemetery. But I have lots of friends there and I’ve been traveling back and forth since 2007.

Adams: How did you get the idea to build tractors?

Berenthal: I understood the needs of the Cuban economy. Cuba has to import more than 70% of what people eat. They’re still using oxen to farm the land. Our motivation really is to help the Cuban farmer be more productive.

Adams: But you and Mr. Clemmons are software engineers. How did you know the first thing about farm equipment?

Berenthal: Horace was born and raised on a farm in Alabama. He’s the farming expert and I’m the Cuba expert.

Adams: Just because he was raised on a farm wouldn’t mean he would know how to make tractors.

Berenthal: We hired an engineering company in Alabama that helped us pick up an existing design that was appropriate for what we wanted to do. We brought in state-of-the-art technology and produced the tractors. We have a tractor in Cuba already that’s going to be shown at an agricultural fair in March.

Adams: It sounds like you were motivated less by profit than by a desire to help the Cuban economy and Cuban-American relations.

Berenthal: Yes, our motivation is really to help Cuban farmers be more productive. Through commerce and trade, we can bring Cuban and American people closer together.

Adams: What about making money?

Berenthal: Our business model says we are investing in Cuba and reinvesting any profits we make. We’ll do what we did with our other businesses. We’ll create value and then sell the company.

Adams: What profit margins do you project for your tractors?

Berenthal: We’re aiming for 20%.

Adams: How many tractors do you need to sell before you’re profitable?

Berenthal: We believe we’ll sell 300 tractors in the first year and then we’ll ramp up to 5,000. That includes other light equipment we’ll sell for construction as well. The facility will have the capacity to produce up to 1,000 tractors a year. I think the profitability will come after the first or second year when we start to do production and not just assembly in Cuba.

Adams: But Cuba is plagued by shortages of the most basic products. How will you get tractor parts?

Berenthal: They’re all going to be sourced and shipped from the U.S. The current state of the embargo makes it so we can’t buy parts there. But we think that within the next three years the embargo will be lifted and we’ll be able to source from Cuba, if not sooner.

Adams: Your factory will be in a special economic zone?

Berenthal: It’s called ZED, for Zona Especial de Mariel. It’s built around one of Cuba’s biggest ports and it has a whole bunch of sections dedicated to foreign investment. They provide for a bunch of tax and investment incentives. We’re also taking advantage of Cuba’s commercial treaties with the rest of Latin America, where we’ll be able to ship and provide better pricing than for tractors built in the U.S.

Adams: What kind of tax incentive is Cuba offering?

Berenthal: For the first 10 years we don’t pay any taxes.

Adams: How many local people will you employ?

Berenthal: We’ll start with five and ramp up to 30 within the first year and then probably go up to 300.

Adams: You want to sell the tractors for $8,000-$10,000. How can a Cuban farmer with an ox possibly afford that?

Berenthal: There are a couple of ways. There is financing by the Cuban government and by third countries like Spain, France and the Netherlands. We also count on Cuban-Americans who live in the U.S. who have relatives and friends that run farms. We think they would be happy to contribute to Cubans owning a tractor. We’re also counting on NGOs that help Cuban farmers, like religious groups.

Adams: How much is your initial investment?

Berenthal: We project a $5 million investment and then it will go up to $10 million.

Adams: Where are you getting the money?

Berenthal: It’s private money. We have a couple of investors but we have also sold a couple of companies.

Adams: What did you find when you went to Cuba?

Berenthal: I started meeting with people and I had a lot of contacts in the economics department at the University of Havana. I learned what the Cuban government was proposing to do about readjusting the economy. In 2014, when the opportunity for trade arose, we decided to pursue farming and tractors.

Adams: How difficult was it to get U.S. government approval?

Berenthal: In all honesty it was tedious rather than difficult. We had to wait for the regulations to change so that the proposal we made was covered by the regulations implemented over the last nine months.

Adams: Were you competing with other U.S. companies?

Berenthal: We certainly believe we’re going to compete with the Chinese and Byelorussians, who are the current suppliers of tractors to the Cuban government.

Adams: Where did you get the names for your company, Cleber, and product, Oggun.

Berenthal: Cleber is from our names, Clemmons and Berenthal. It’s clever! Oggun is the name of the deity for iron in the Santeria religion. Santeria is the most popular religion in Cuba. It’s a mixture of Catholic and African religions.

Adams: Do you practice Santeria?

Berenthal: No ma’am. I’m Jewish. We’re called Jewbans

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U.S. APPROVES FIRST FACTORY IN CUBA SINCE 1959

MICHAEL WEISSENSTEIN

HAVANA — The Associated Press

Original Article: U.S. Tractor Factory in Cuba

Globe and Mail, Toronto. Published Monday, Feb. 15, 2016 5:23PM EST

The Obama administration has approved the first U.S. factory in Cuba in more than half a century, allowing a two-man company from Alabama to build a plant assembling as many as 1,000 small tractors a year for sale to private farmers in Cuba.

The U.S. Treasury Department last week notified partners Horace Clemmons and Saul Berenthal that they can legally build tractors and other heavy equipment in a special economic zone started by the Cuban government to attract foreign investment.

Cuban officials already have publicly and enthusiastically endorsed the project. The partners said they expect to be building tractors in Cuba by the first quarter of 2017.

“Everybody wants to go to Cuba to sell something and that’s not what we’re trying to do. We’re looking at the problem and how do we help Cuba solve the problems that they consider are the most important problems for them to solve,” Mr. Clemmons said. “It’s our belief that in the long run we both win if we do things that are beneficial to both countries.”

The $5-million (U.S.) to $10-million plant would be the first significant U.S. business investment on Cuban soil since Fidel Castro took power in 1959 and nationalized billions of dollars of U.S. corporate and private property. That confiscation provoked a U.S. embargo on Cuba that prohibited virtually all forms of commerce and fined non-U.S. companies millions of dollars for doing business with the island country.

Farm Worker Plowing Field with a Team of OxenSome Competition for the Oxen. (Ploughing a field at Vinales)

Letting an American tractor company operate inside a Cuban government facility would have been unimaginable before Presidents Barack Obama and Raul Castro declared on Dec. 17, 2014, that they would restore diplomatic relations and move to normalize trade, travel and other aspects of the long-broken bilateral relationship.

Since then, Mr. Obama has been carving exceptions into the embargo through a series of executive actions, and his administration now says they allow U.S. manufacturing at the Mariel port and special economic zone about 48 kilometres west of Havana. One exception allows U.S. companies to export products that benefit private and co-operative farmers in Cuba. Mr. Berenthal and Mr. Clemmons say they will sell only to the private sector.

The Obama administration says it is eager to make the opening with Cuba irreversible by any future administration. Since the start of the year, the United States and Cuba have made a series of announcements that appear designed partly to create a sense of unstoppable momentum in their new relationship.

Cuba announced late last month that it would more than double the number of public WiFi access spots to more than 100 across the country this year and bring broadband Internet to a small number of Cuban homes, where it is currently illegal. Mr. Obama said in 2014 that Mr. Castro had promised to increase Cubans’ access to the Internet as part of détente.

On Saturday, Cuba announced it had returned a U.S. Hellfire missile it said was mistakenly shipped to Havana from Paris in 2014. On Tuesday, Cuba’s Transport Minister and the U.S. Secretary of Transportation will sign a deal authorizing the first regularly scheduled commercial flights between the United States and Cuba since shortly after the 1959 revolution.

The Oggun tractor plant, named after a god in Cuba’s syncretic Santeria religion, will assemble commercially available components into a durable and easy-to-maintain 25-horsepower tractor selling for less than $10,000, Mr. Clemmons and Mr. Berenthal said. The men believe they can sell hundreds of the tractors a year to Cuban farmers with financing from relatives outside the country and to non-government organizations seeking to help improve Cuban agriculture, which suffers from low productivity due mostly to excessive control of both basic supplies and prices by an inefficient, centrally planned state bureaucracy.

“I have two countries that for 60 years have been in the worst of terms, anything I can do to bring to the two countries and the two people together is tremendously satisfying,” said Mr. Berenthal, a Cuban-born semi-retired software engineer who left the country at age 16.

He met Mr. Clemmons, who is from Paint Rock, Ala., when they worked at IBM in the 1970s. They left to form a successful cash-register software company that grew to earn $30-million a year before they sold it in 1995 for a sum Mr. Clemmons says was “enough that I don’t have to work.”

Between their own capital and commitments from private investors, they say they have enough cash in hand to build the Oggun factory as soon as Cuba lets them proceed.

“Everything’s locked in,” Mr. Clemmons said.

Mr. Berenthal said they are optimistic they will also be able to export Oggun tractors to other Latin American countries, which have low or no tariffs on Cuba products, making them competitive on price. The men expect a 10-per-cent to 20-per-cent profit on each tractor.

For the project’s first three years, Mr. Clemmons and Mr. Berenthal say they will export components from the United States for assembly in Cuba. They hope to eventually begin manufacturing many of the parts themselves on the island. They said they expect to start with 30 Cuban employees and, if things go as planned, grow within five years to as many as 300.

Mr. Clemmons and Mr. Berenthal will publish all the schematics of their tractors online to allow Cubans and other clients to more easily repair their equipment and come up with designs for other heavy equipment based on the same frame and motor that the company, Cleber, can then produce at its Mariel factory.

The men already have plans to produce excavators, backhoes, trench diggers and forklifts, equipment badly needed across Cuba, where virtually all the infrastructure is crumbling after years of neglect and mismanagement and a lack of cash the government blames on the embargo.

“I think it’ll have a tremendous impact on their ability not only to help their economy but to set an example across the Caribbean and Latin America,” Mr. Berenthal said.

zzz

 Case – International Harvester sugar cane harvester, made in Brazil. The next step for Cuban agricultural machinery assembly?

z Cane-Harvester-October-1993-002Cuban-manufactured Sugar Cane Harvester Pausing on the Highway, November 1994.  Was this the last Cuban-made  cane harvester?Photo by Arch Ritter.

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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!’”

 z

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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WHY THE U.S. SHOULD EMBRACE THE RISE OF CUBA’S ENTREPRENEURS

Huffington Post 01/25/2016;

Original Article here: Cuba’s Entrepreneurs

Ted A. Henken, Former President of the Association for the Study of the Cuban Economy (ASCE) and Baruch College (CUNY) Professor

Cuentapropista (a Cuban entrepreneur) is a term that up until a few years ago would not have been used to describe a large sector of Cuba’s centralized and still heavily planned economy. But despite heavy odds, I have recently witnessed the proliferation of Cuban entrepreneurship and its positive effects on the Island. As a Yuma (a Cuban term of endearment referring to visiting Americans), I’ve seen Cuba’s “non-state” sector expand considerably, giving testimony to the entrepreneurial successes that everyday Cubans are achieving, and hunger to expand upon.

Engaging directly with Cuba’s entrepreneurial sector — while we push for an end to our pernicious trade embargo — allows us to remove the U.S. as the Cuban government’s bête noir and empower more Cubans to be the masters of their own fates. Some hardliners in the U.S. would argue that engaging any sector in Cuba is helping the monopolistic and undemocratic Cuban government consolidate its power. However, the last 50 years have shown that isolation has only aided the Cuban government in strengthening its monopolies while deflecting blame for its failing economy onto the U.S. embargo. Engagement with cuentapropistas, on the other hand, gives us the chance to begin to build relationships of trust and mutual benefit with the Cuban people.

In the face of constant economic instability and state control, cuentapropistas are the defining social and economic catalyst for Cuba’s future. They are men and women who display incredible motivation and creativity in their business ventures, and are willing to take risks, often at great personal cost. As a result, the burgeoning private sector is now one of the most productive areas of an otherwise failing economy.

In a fact sheet I recently released in partnership with Engage Cuba and the Cuba Emprende Foundation, we found that while Cuba has the most educated, low-cost labor force in the world, private sector opportunities for Cuban professionals continue to be severely limited. As a result, entrepreneurial Cubans have taken their fate into their own hands and are now estimated to be one-third of Cuba’s total workforce. The rate of self-employment has surged to new heights in the last five years, rising from just under 150,000 to over half a million cuentapropistas by mid-2015.

A surprising area of self-employment growth is in telecommunications. The chronic scarcities and bottlenecks caused by the lethal combination of state socialist planning and the U.S. embargo have resulted in the incubation of a true “maker” culture. Highly trained but underemployed computer programmers and telecom agents have started launching innovative start-ups like AlaMesa and Conoce Cuba or designing “lean” software and offline mobile apps for both a Cuban and international clientele. Aiming to encourage this dynamic phenomenon, new U.S. regulations issued by the Obama Administration during 2015 now allow the contracting of Cuba’s private sector IT and other professionals.

But don’t be fooled. There are still drastic internal barriers for motivated, business-minded Cubans. The tax structure is burdensome, the private sector is legally cut off from international trade (apart from imports and exports via “suitcase commerce”), and cuentapropistas enjoy little reliable access to wholesale goods, rental space, credit, or foreign investment. Basic infrastructure is woefully outdated, and Internet access — the driver of any modern business — is still very limited and costly. Perhaps this is why despite unprecedented growth over the past five years, the cuentapropista sector contracted for the first time in the second half of 2015, falling to 496,400 by January 2016.

There are also serious structural workforce issues. For example, every year over 4,000 information technology engineers graduate across the country, but there are a limited number of state positions available to them. Therefore, many of these graduates are forced to join the historic exodus of young professionals abroad in order to find an economic return on their educations.

The possibilities for these young entrepreneurs will be virtually limitless once the island is equipped with a modern telecommunications infrastructure — something that can be made possible with the help of American investment. But in order for U.S. telecommunication services and other businesses to help bring meaningful change in Cuba, Congress needs to lift the trade embargo.

Because while American entrepreneurs and businesses await an end to the embargo, both Americans and Cubans are missing out. It is estimated that the U.S. is currently forgoing 1.6 billion in potential sales to Cuba annually due to current policy. Americans from across political parties have duly noted this fact. According to a Pew Research Center report, 72 percent of Americans, including 59 percent of Republicans, favor ending the Cuban trade embargo.

It is ironic that many embargo supporters rightly critique the Cuban government for restricting the free market inside the Island while simultaneously supporting an embargo that unfairly restricts American businesses abroad and any benefits they could bring to Cuba’s struggling entrepreneurs and its people. By allowing Americans to bring business and investment to the Island, we will grow our own economy while supporting the Cuban people, including cuentapropistas, in the process.

henkenteaching_001_jpgTed A. Henken, Ph.D., is the President Ex-Officio of the Association for Study of the Cuban Economy (ASCE) and co-author of the book “Entrepreneurial Cuba: The Changing Policy Landscape.” Henken is a member of the Policy Council of Engage Cuba, a bipartisan organization dedicated to mobilizing American businesses and non-profit groups to support the ongoing U.S.Cuba normalization process.

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POLL: CUBAN AMERICANS FAVOR OBAMA’S POLICY OVER RUBIO’S

Original Essay: Cuban Americans: Obama over Rubio and Cruz zzzzzzz CUBA STANDARD

Bad news for Marco Rubio and Ted Cruz: Most Cuban Americans support President Barack Obama’s normalization policy with Cuba, suggests a poll published by Miami-based Bendixen & Amandi International on Dec. 17, the anniversary of the normalization announcement by the presidents of the United States and Cuba.

The survey’s results suggest that presidential candidates Marco Rubio and Ted Cruz, both Cuban American Republicans espousing hardline views of U.S.-Cuba relations, do not represent the majority views of the Cuban community in the United States.

According to the poll, a clear 56% majority support Obama’s normalization policy, 12% more than a year ago, and 53% of Cuban Americans would like to see the embargo lifted, 9% more than last year. The majority is larger among younger Cuban Americans: Sixty-six percent of those age 18-49 favor an end of U.S. sanctions.

Bendixen conducted the survey Dec. 14-16 among 400 Cuban Americans. Florida, a center for histórico exiles who have been driving the U.S. sanctions policy, polls less favorable for Obama’s policy than the rest of the United States. Only 41% of Cuban Americans living in Florida said they had a favorable impression of normalization policies, compared to 56% of Cuban Americans living elsewhere in the United States. Despite broad support for his policy, 52% of Cuban Americans said they would oppose a trip to Cuba by Obama.

The U.S. president announced this month that he would like to visit the island, on condition of progress by the Cuban government on human rights issues.

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CUBAN BASEBALL CRISIS: THE DOWNSIDE OF WARMING RELATIONS WITH AMERICA

The Economist, December 18, 2015

Original Essay: Cuban Baseball Crisis

zzzzThe Havana Sugar Kings of the old International League, circa 1956

LOOK for the Che Guevara mural on a pitch-black street corner in Lawton, a run-down district on the outskirts of Havana. Turn left, walk up the concrete steps and give the password (today it’s “I sell green dwarfs”). Inside, around 20 Cuban men sit silently. Despite the humidity, the ceiling fan is still, allowing puffs of sweet tobacco smoke to hover in the flickering fluorescent light. The newcomers are asked for a “solidarity contribution” of 25 Cuban pesos, or $1. After the customary first drops are spilled to sate the thirst of the saints, a $3 bottle of clear rum makes its way around.

It could easily be a clandestine political gathering. But this group has far more important business: the first game in the Major League Baseball (MLB) semi-final series between the Kansas City Royals and Toronto Blue Jays. For half a century after Cuba’s revolution in 1959, the island’s sports fans knew little of professional leagues beyond their shores. But today, thanks to the internet’s belated arrival and a wave of Cuban players defecting and starring in MLB, in-depth knowledge of American baseball is a badge of honour for baseball-loving Cubans—that is, nearly all the men and plenty of the women, too. “You didn’t know Kansas City won? You’re an embarrassment,” one attendee teased a friend during the ride to Lawton in an exhaust-spewing 1950s taxi, whose shock absorbers were no match for the area’s cavernous potholes.

The easiest way for Cubans to follow MLB in real time is at hotel bars in Vedado, a central Havana district packed with middle-aged American tourists taking advantage of the recent relaxation of travel restrictions. But few Cubans can afford a beer priced in dollars. And if a woman happens to be running a shift at the bar, locals say, there’s always a risk she will put a soap opera on the TV instead. So baseball fans gather in speakeasies like this decrepit flat, whose owner has managed to acquire an illegal satellite broadcast signal and hook it up to his 1980s Japanese television.

The group try to keep quiet, lest the neighbours snitch to the local Committee for the Defence of the Revolution (a network of government informants in every town). But they are rooting for the Royals because of the team’s first baseman, Kendrys Morales, who fled Cuba on a raft in 2004 after serving several stints in jail for his seven previous failed escape attempts. Every time he comes up to bat they allow themselves a muffled cheer. A round of high-fives follows Kansas City’s 5-0 victory.

The next day a big game is scheduled in the domestic baseball league, at Havana’s rickety 55,000-seat Latin American Stadium. It pits the hometown Industriales, Cuba’s answer to the New York Yankees, against a visiting club from nearby Matanzas. A few years ago the stands would have been packed. But today the outfield bleachers are empty, and only the rows of seats closest to the action appear even half-full. Bored-looking police drag on cigarettes. A group of hometown fans tries to rouse the crowd by blaring on hand-held air horns, but it is well short of critical mass.

One reason for the apathetic mood is that the government has banned alcohol sales in stadiums to stop fights. A bigger problem is the poor quality of the play. Last year 11 Industriales players left for the United States; Matanzas lost ten. Only the weaker players remain, and they are demoralised: runners seem content to jog around the basepaths, and fielders let the ball skip past them on difficult plays. In recognition of the depleted rosters, the Cuban league now disbands half of its teams at mid-season and shares their players among the eight clubs that are doing best.

Today’s game is painfully lopsided, as the Matanzas hitters pound the Industriales starting pitcher for seven runs. The biggest attraction is Rey Ordóñez, who defected in 1993, played in MLB for nine years and is catching a game on a visit home. Fans pose with him for pictures. “It’s very hard for the team,” says Lourdes Gourriel junior, the 21-year-old shortstop for the Industriales, following his team’s defeat. “It’s weird seeing someone on TV [in MLB], and just yesterday they were here with you. But that’s everyone’s individual decision. We’re still friends with those who left.”

South American football fans are accustomed to their countries’ brightest sporting stars decamping to richer European leagues. But for Cuban baseball fans the exodus is new. Less than a year after the United States and the government of Raúl Castro, Fidel’s younger brother and successor, announced they would re-establish diplomatic relations, this brawn drain is the most visible consequence of rapprochement with the yanquis, and an indication of what might be lost as the Cuban economy liberalises.

BOTTOM OF THE NINETEENTH CENTURY

Although baseball originated in the United States, the sport arrived in Cuba during its infancy in the 1860s. Within a decade of the first recorded match on the island, Cuba had established the first professional league outside America and put its adopted national game at the service of political aims: the league’s organisers funnelled its profits to guerrilla groups fighting for independence from Spain, and the movement’s spies posed as baseball players when shuttling messages and funds to and from supporters in the United States. “Baseball is more Cuba’s national pastime than it is America’s,” says Roberto González Echevarría, the author of a history of Cuban baseball. “It was considered modern, democratic and American, while the Spaniards had bullfighting, which was retrograde and barbaric. It’s as if the American Founding Fathers had been wielding Louisville Sluggers [an iconic brand of bat].”

After Cuba gained its independence in 1902 baseball became one of its principal means of exercising soft power. It was Cuban athletes, not American soldiers, who spread the sport across the Spanish-speaking Caribbean, helping to form a shared cultural identity with the Dominican Republic, Puerto Rico, Venezuela and eastern Mexico, and earning the Cuban players the nickname the “apostles of baseball”. And it was baseball players who became the best-known Cubans in the United States. Of all the MLB players born in Latin America who started playing before 1959, two-thirds were Cuban, even though most of the island’s stars were black and banned from MLB until the league’s colour barrier was broken in 1947. (In 1912, in response to inquiries about the lineage of two olive-skinned Cuban players, the Cincinnati Reds conducted an “investigation” which declared them “two of the purest bars of Castilian soap [that] ever floated to these shores”.) During the same period Cuba was putting black and white talent on the same fields in its racially integrated winter league, establishing the country as an exemplar of moral leadership in sports.

After Fidel Castro (pictured, swinging) took power and became the island’s baseball-fan-in-chief, the sport’s tacit political role became explicit. He proclaimed athletes to be “standard-bearers of the revolution playing for the love of the people, not money”. He banned professional sports and founded the National Series, a wildly popular amateur league in which each province fielded a team of players from its territory. He also established a formidable player-development system, with scouts identifying talented children and academies to train them once they became teenagers.

American fans, who then, as now, paid attention only to MLB, were unaware of the stars Cuba was producing, since they never played for a team in the United States. But Cuba’s athletic assembly line yielded a national team that dominated the weak competition in international events like the Olympics (in which MLB players do not participate): from 1987 to 1997, the squad won 156 straight games. The elder Mr Castro made such successes central to his propaganda strategy. “The only way Cuba could raise its head in the world was in sports,” says Ismael Sené, who ran the sports department of the Communist Youth in the early 1960s. “There was a campaign against us from the outside, saying that we were all needy, that we didn’t have food. Well, look at our athletes!” The fact that baseball, America’s “national pastime”, was Cuba’s strong suit made each victory extra sweet.

Fidel Castro might be proud of Cuba’s ability to export baseball players, were they not going to America

But setting so much store by its baseball players left the government vulnerable to shifting geopolitics. In 1991 René Arocha, a pitcher in the national team, walked out of his hotel room during a tournament in Miami, made his way to his aunt’s house, and never returned, making him the first team member to defect in history. He had not been planning on playing baseball afterwards, because he had assumed that MLB players were far superior to Cuban ones. But after connecting with a Cuban-born agent, he was given an MLB contract with a six-figure salary, and the next year became the St Louis Cardinals’ second-best pitcher.

After Mr Arocha had proved that Cuban players were of MLB quality, and the fall of the Soviet Union plunged Cuba into a “special period” of unprecedented poverty, more defectors began to leak out. Two half-brothers, Liván and Orlando Hernández, left the island separately in the 1990s, one at a tournament, the other on a rickety boat. Both played starring roles for World Series champions in their first years in MLB, providing Miami’s Castro-hating exiles with a remarkable narrative about the risks Cubans will take for a taste of freedom and the chance to play America’s game. To reduce the risk of further defections, the Cuban team put its players under tight surveillance whenever they travelled abroad, making their national treasures feel like prisoners and encouraging more defections.

SQUEEZE PLAY

The government responded to early defections with stoicism. “When one leaves, another ten better players emerge,” Fidel Castro once said. But in the past few years, the trickle of defections has become a torrent. As recently as 2007 there were just ten Cubans in MLB. Today there are 27. And whereas some of the early defectors had undistinguished careers, the current crop is aking an impact that, were it to occur anywhere but in the reviled United States, Fidel Castro would probably regard as his greatest accomplishment. Yoenis Céspedes, a burly outfielder with a pronounced uppercut swing, single-handedly powered the New York Mets to the World Series this year. His deadly accurate throws to home plate from distances of 300 feet (91 metres) or more have earned him the nickname the Cuban Missile. José Fernández, who fished his mother out of the ocean after a wave swept her overboard during their escape to Mexico when he was 15, is the toast of Miami’s Little Havana for his unhittable array of blazing fastballs and knee-bending curves. Aroldis Chapman holds the record for the fastest pitch in MLB history at 105 miles (169km) per hour. At the “Esquina Caliente” (Hot Corner), a bench in a downtown Havana park where die-hard fans have gathered daily for decades to talk baseball, the regulars today come prepared with the latest statistics on how Cuban players—and even the American-born children of Cuban exiles—are performing in MLB. They use websites like CubanPlay, a new, locally run site, by connecting their phones to public hotspots accessible with $2-an-hour Wi-Fi cards.

Major-league success has been accompanied by major-league riches: the 27 Cuban MLB players earn an aggregate annual salary of $100m. As the rewards have grown, a sophisticated infrastructure to smuggle more players has built up. Almost all recent defectors have escaped with the help of sinister human-trafficking syndicates. These hire boats to bring players to nearby countries, bribe the Cuban coastguard to let them depart, and Dominican or Mexican authorities to grant residency papers, pay tribute to organised-crime groups for the right to operate on their turf, and hold players hostage until they sign an MLB contract and provide a return on the gangsters’ investment, perhaps from their signing bonus. Yasiel Puig, a star right fielder, was held at a motel in Mexico’s Yucatán peninsula for months while his captors, associated with the fearsome Zetas mafia, argued over payment. Leonys Martín, an outfielder, was held at gunpoint in Mexico and forced to sign a contract in which he promised to pay 30% of his earnings to a front company; his smugglers are now in a Florida jail.

Since Raúl Castro became Cuba’s president in 2006, he has cautiously tried to relax state controls. But the defections have forced the pace when it comes to baseball. In 2013 Cuba said it would allow athletes to play professionally in foreign leagues—if they paid a 20% tax and returned for international tournaments and the winter National Series. A handful have gone to the Japanese league in the summer and earned seven-figure salaries.

Both MLB and the Cuban government now say they want a “normalised” system, in which Cuban athletes can travel to America legally and safely, play for MLB teams on a work visa and return home in the off-season. Antonio Castro, one of Fidel’s nine acknowledged children, an international baseball official and the national team’s doctor, has publicly called for such a change.

In an echo of the 1970s “ping-pong diplomacy” in which table tennis helped restore relations between the United States and China, MLB is encouraging a thaw between Havana and Washington. It has applied for an American government licence to do business in Cuba, is sending former players on a pre-Christmas goodwill tour of the island and is trying to organise an exhibition game in Havana featuring one of its teams next March. Meanwhile, Cuban baseball stars are giving Americans a new perspective on a country many perceive as nothing more than a totalitarian dystopia.

Yet the defections continue, for two reasons. The first is that the Cuban baseball authorities’ proclamations that players are now “free to go” ring hollow. It is the government, not athletes, that determines who can leave and for how long, to which country and team, and how much they will be paid. It generally selects older stars who have shown loyalty to the regime.

The second is the continuing influence of ageing “cold warriors” in the United States. Although Barack Obama has streamlined much of the bureaucracy required to authorise contracts with Cuban players, they must still establish residency outside Cuba and sign an affidavit saying that they “do not intend to, nor would [they] be welcome to, return to Cuba”. And America’s trade embargo, which can only be lifted by Congress, bans transactions with the Cuban government. That precludes any arrangement in which athletes would pay a modest tax on their foreign earnings in recognition of the state’s investment in training them, just as the United States taxes its citizens on their worldwide income. Cuba’s requirement that its players working abroad also participate in the National Series and be available to the national team represents another stumbling block, since MLB clubs would never allow their stars to skip out for an international tournament during the season, or risk injury during a long winter campaign in Cuba.

 

Yet for all the Cuban government’s rhetoric about America’s athletic imperialism, it may have an unlikely ally in MLB on the issues that concern it most. Despite MLB’s reputation as a fiercely capitalist industry worth $9 billion a year, the game’s economic model has much in common with Cuban-style socialist principles. To maintain fans’ interest, MLB needs a competitive balance between its rich and poor clubs. It accomplishes this by levying a tax on teams with high payrolls, and via an annual draft that routes the best young players to losing franchises. Cuban players aged over 23 with at least five years in the National Series are exempt from these rules. That enables them to auction their services to the highest bidder, undermining MLB’s carefully calibrated system of economic redistribution and reducing club owners’ profits. As a result, MLB is likely to advocate a tightly controlled system of acquiring Cuban players, rather than a free-for-all.

Moreover, MLB clubs and agents are already warning that after so many defections, the Cuban baseball pipeline is running dry and will need to be replenished. At the Premier 12, an international tournament held last month in Taiwan and Japan, Cuba finished an embarrassing sixth. The unique baseball culture Cuba has developed over 50 years of isolation has proved to be a formidable manufacturer of outstanding players. The Dominican Republic and Venezuela serve as providers of raw athletic material for MLB. Ordinary Cubans, by contrast, have grown accustomed to a remarkable closeness to world-class athletes, who play only for their home provinces and for almost no pay. “I’m just another fan,” says Reinier Reynoso, a 27-year-old pitcher for Industriales who is hanging out with the faithful outside the ballpark before a game. Fans and players “party together”, he says.

Since MLB has a keen interest in producing a new generation of Cuban superstars, it is reluctant to meddle with this potent combination of popular encouragement and state support. “We have no interest in going to Cuba and taking all of their players,” says Dan Halem, MLB’s chief legal officer. “We want Cuban baseball to thrive. We’re perfectly happy for Cuba to develop their own stars and keep them for a period of time. If they lose all their stars, fans will lose interest. There aren’t enough countries where baseball is played for this to just be a feeder for Major League Baseball.”

zzzzzzA recent friendly game

zzzzzWorld champions many times over

CASTRO AT BAT 1977

A Cuban baseball star

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