Somos+, Germán M. González, 26 April 2019 — When Donald Trump won the 2016 presidential election, the Cuban government and Communist Party assumed a disinterested attitude. At first, official propaganda outlets gave the event little attention and toned down their routine attacks on American leaders. That attitude persisted until some time after the presidential inauguration, when the growing closeness between the business-magnate-turned-president and Cuban-American politicians had become more apparent.
Initially, the new administration did not take harsher measures. It even maintained the policies of the previous administration in regards to matters of real interest to Havana: remittances, family visits and business trips by Cubans and Cuban-Americans to and from Cuba. But the power struggle in Venezuela was becoming ever more acute and Russia’s presence in the country was becoming increasingly obvious.
The Russian presence ran the gamut, from its highly publicized military presence to the much less publicized Russian appropriation of Venezuelan assets in an effort to secure loans and investments. It is worth remembering that these assets include, or may include, CITGO, a subsidiary of PDSVA (Venezuela’s state-owned oil and gas company), which owns an extensive number of properties and accounts for up to 10% of all the gasoline sold at U.S. service stations.
In other words, the Russian intrusion was not limited just to the proverbial “backyard.” It extended to the house itself, an unprecedented development, which made the Americans apprehensive. The situation began during the presidency of Barack Obama, who declared Venezuela a threat to national security, increasing the level of hostility. Nevertheless, we do not know why Cuba was not, until recently, part of the team of old hawks, known Latin American “specialists,” currently ruling Venezuela.
Recently, the U.S. canceled the agreement signed by the Major Leagues and the Cuban Baseball Federation (which would have been paid as the players’ agent), arguing that it was a Cuban government entity. Freighters owned by PDVSA and several international companies that transport oil from Venezuela were also sanctioned, striking at something of vital interest to the Cuban regime. The action involves freezing PDSVA assets under American jurisdiction, preventing financial transactions and blocking the company’s access to US ports.
It was during lunch with Secretary of State John Bolton on the 58th anniversary of their defeat during the Bay of Pigs invasion on April 17, 1961 that members of Brigade 2506 learned that the White House was applying new or toughened sanctions on Cuba, something that the State Department was putting into place that same morning. These include but are not limited to Title III and Title IV of the Helms-Burton Act, which allow individuals to file suit in American courts against companies that operate on property confiscated by the Cuban government. Enforcement has been waived every six months for the last twenty-three years.
The first cases were filed by Cuban-Americans on May 1. Potential plaintiffs vary from giant companies like Bacardi — it has annual receipts of 33 billion dollars, three times the value of all Cuban exports — to individuals whose small homes, cars, household appliances and personal effects were confiscated under Che Guevara’s philosophy that even toothbrush constituted private property.
The European Union and Canada have announced countermeasures to defend their interests. They involve various entities which manage the hard currency income generated by joint venture projects — tourism, airports, the port of Mariel, mining operations — between Cuba and its creditor nations. The projects are part of a “debt swap,” intended repay the enormous sums of money Cub borrowed from those countries.
It is an interesting development given that the Europeans, and especially Canada, have been accompanying Trump & Co. on his crusade against the Maduro regime and, like the Americans, are worried about Russia’s involvement in the western hemisphere. Title IV also allows individuals and their family members to be sued, a highly sensitive issue for businesspeople involved in global trade, especially if that trade is with the world’s most powerful economy.
Restrictions on travel and remittances. In 2018 some 658,000 Americans and 521,000 Cuban Americans visited Cuba, an increase of over 20% for both groups. According to the Havana Consulting Group, annual remittances in the form of cash and merchandise totalled 6.5 billion dollars. It is the country’s second largest source of hard currency after income from the labor force. The measure will limit the flow of travelers and remittances (one thousand dollars per quarter) and will hinder cruise operations associated with the use of confiscated properties.
Expanding the list of restricted Cuban companies. Currently there are more than 200 Cuban entities subject to economic sanctions by the United States. The list was created in November 2017 and expanded last March. Six more entities have since been added, among them Aerogaviota. The ruling prohibits financial transactions between U.S. citizens and firms with those business entities run by the Revolutionary Armed Forces and the Ministry of the Interior.
Cuba’s return to the list of state sponsors of terrorism. This measure and several others have yet to be adopted. But expectations are that, the next time the Department of State sends the new list to Congress, Cuba will added to it. International financial transactions by countries on the list are subject to extreme scrutiny. Individuals, companies and countries which engage in commercial transactions can also be penalized. The measure also means the chances are greater that the processing of visas will take longer and that state universities in Florida will have to cancel exchange programs with Cuban academies as well as student trips to the island.
This decision by the Trump administration is based on the presence of Cuban military and intelligence personnel in Venezuela, who are there to support the Maduro regime. The Cuban elite also has deep ties to organizations like the FARC and ELN in Colombia. Havana has close relations with Iran, North Korea and Syria, countries designated as sponsors of terrorism by the U.S. Department of State.
Cuba itself was on the terrorism list from 1982 until 2015, when it was removed by President Obama upon the restoration of diplomatic relations. In addition to Cuba, sanctions were placed the Central Bank of Venezuela, a Nicaraguan bank, and on a son of Daniel Ortega.
Conclusion. Based on news reports, there are clear indications that the second Special Period (one wonders why it is called this since we have been in this period, more or less, for the last sixty years) has arrived. The consequences and possible scenarios merit a separate discussion but, if anything is becoming clear with each passing day, it is the need to democratize the country and restore full rights. These include civil, political and economic rights for all Cubans, no matter where they live. If the party and government do not take action in this direction, it is sacrificing its own existence and our own national identity to the interests of caste and a political-economic system that has never worked.