Texans visiting Cuba say they see little change in trade

Texans visiting Cuba say they see little change in trade
Published: 02 May 2015 11:17 PM
Updated: 03 May 2015 12:13 AM

HAVANA — At a restaurant in Old Havana, Ben Scholz waited anxiously for
his plate of lobster, rice and beans, trying to choose the right words
to describe the takeaway from his first visit to the communist-run island.

He and 12 other Texans had just spent two long days meeting with Cuban
bureaucrats and visiting a farm and a port undergoing a massive
expansion. It was the first trip to Cuba for a Texas trade group since
Presidents Barack Obama and Raúl Castro signaled a thaw in their
countries' complicated relationship. And yet Scholz, a plainspoken wheat
farmer from Lavon, just east of Dallas, struggled for words.

"I wouldn't say I'm more or less excited," Scholz said, referring to
prospects for improved trade ties. "I'm more informed."

The Texans say they came with open minds to talk about the price of
soybeans, wheat and rice and about new technology for agricultural
efficiency. At one point, Scholz said, he took out his smartphone to
show pictures of his crops, vast fields of wheat that have benefited
from technological breakthroughs. He spoke to his hosts in Spanish. The
Cubans seemed impressed and awed by the possibilities, Scholz said.

Frozen in time

The Texans listened carefully to gauge any opening on the part of their
hosts. But by the end of the trip, the Cubans seemed frozen in time,
Texans said. The bureaucrats from the agricultural and import sectors,
farm cooperatives and port authorities talked more about the "gains of
the revolution" than of finding ways to overcome imposing financial
hurdles. Some spoke only through prepared scripts and limited media
access, explaining that they needed prior approval. They seemed fixated
on one thing, the Texans said: Lift the U.S. embargo, which they called
the "blockade."

The anticipation following the thaw in U.S.-Cuba relations, the most
significant easing of tensions between the two countries in more than 50
years, was tempered with a dose of reality: The U.S. Congress shows no
sign of lifting the embargo, and the Cuban government seems determined
to continue to use it as a political tool and an excuse for the nation's
ills, analysts say.

Caught in the middle are many Cubans and Americans, including the
Texans, who are trying to turn the page on a Cold War grudge.

John Kavulich, senior policy adviser to the U.S.-Cuba Trade and Economic
Council, said many in Congress are reluctant to hand Raúl Castro and his
older brother Fidel what could be perceived as a victory.

"As long as both Raúl Castro and Fidel Castro remain alive," he said,
"there will be reluctance to provide a perception that they have 'won'
and outlasted the embargo."

Natural market

With 11.3 million people, Cuba is hardly considered a giant trade market
for the U.S. But for more than 50 years, the U.S. embargo ceded a market
90 miles from the United States to companies from Europe, Asia, Canada
and Latin America. Texas farmers, who already dominate the Caribbean
market, want to expand their reach into Cuba.

"This market is hardly a game-changer in terms of U.S. trade," said Ken
Davis of the Texas Wheat Producers Board and Association. "But we
already control up to 90 percent of the Caribbean market, so Cuba is a
natural market for us."

Since trade sanctions were relaxed in 2000 to allow the sale of
agricultural products, U.S. sales to Cuba have grown from $4 million in
2001 to over $300 million in recent years. Texas farmers believe
improved ties between Texas and Cuba could usher in a new era of trade
in a post-embargo period that could increase U.S. farm sales alone to
more than $1 billion, said Dwight Roberts, president and CEO of the U.S.
Rice Producers Association.

More costs, delays

For now, all trade transactions go through the Cuban government, not
individual Cubans or companies, making business cumbersome. Payments are
made through third-country banks, which creates more costs and delays.

On this trip, the Texans were eager to see more nuanced language, a sign
that the Cubans were moving forward and had embraced the cordial posture
of Obama and Castro during their historic handshake at the recent Summit
of the Americas in Panama. Both leaders announced plans to re-establish
embassies. Obama later removed Cuba from the government's list of
countries that sponsor terrorism. Excitement grew.

But the Texans found the Cubans keeping to a hard line.

"The Cubans are afraid of getting in the water and giving capitalism a
chance," said Ned Meister of the Texas Farm Bureau.

Benjamin Smith, managing director of Amarillo-based Attebury Grain,
said: "It was clear this relationship between Cubans and Americans is
like a marriage where the two sides aren't communicating. As business
delegations, whether from Texas or anywhere else, we have to be the
marriage counselors and push things forward. And that's why we came."

Others saw signs of flexibility. This was Cynthia Thomas' 38th visit to
the island. She's president of Dallas-based TriDimension Strategies, a
policy consultant group that has long advocated expanded trade to Cuba
to include airlines, oil, technology, agricultural products and tourism.

She came to push for the sale of powdered milk, and she said the Cubans
provided strong indications of working toward a potential deal that
could mean millions of dollars.

"I've noticed a much more relaxed atmosphere, a real willingness to do
business," she said.

'All or nothing'

But for veterans like G. Glen Jones Jr. of the Texas Farm Bureau in
Waco, the signs weren't there. He last visited Havana in 2008. At the
time Texas was selling about $25 million a year in agricultural goods to
Cuba under the waiver to the U.S. trade embargo allowing the sale of food.

"I didn't see any real changes," he said. "They still want all or
nothing," referring to a lifting of the broader trade embargo, imposed
in 1962.

The bureau is meeting next month to determine what steps to take next
regarding its position on future U.S.-Cuba policy.

Thomas said that the ball is in the Americans' court.

"The hurdle is the U.S. Congress," she said. "We need to fill the space
created by President Obama, or this can go backward before it moves
forward."

Meanwhile, Cuba is taking steps toward enhancing its capacity for
foreign trade. About 45 minutes west of Havana lies the port of Mariel,
once known the site of the massive exodus of Cuban refugees headed for
the United States. These days, hundreds of workers toil to finish the
country's biggest project in modern history, a 180-square-mile special
economic zone known as ZED Mariel.

The estimated $1 billion cost of the project is largely financed by
Brazilians, Chinese and Vietnamese. It includes a new railroad to carry
the cargo containers from the port to across the country and is part of
a long-term plan to attract $3 billion in foreign investment, according
to a port brochure. Construction began in 2010, long before there was a
hint of a thaw in U.S.-Cuba relations, a telling sign for Smith.

"I came here thinking they needed us," he said. "But even if we don't
come anytime soon, they will survive. They have been surviving with the
help of other countries. It's cost them more money, but they are not
paralyzed. The more the U.S. tightened the noose, the more creative they
become."

By the end of the trip, Scholz was a bit disappointed yet still somewhat
hopeful. He spent his last day at a farm, followed by a visit with a
family at their home, a place filled with family portraits and pride. It
reminded him of his own family back in North Texas.

"Despite our differences, theirs is also a culture rooted in family," he
said. "There are common values we share. I liked that."

Source: Texans visiting Cuba say they see little change in trade |
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