U.S. Companies Impeded By The Perils Of Cuba's Ideological Brake-Pad

The Perils Of The Ideological Brake Pad
U.S. Companies Are Unnaturally Constrained
Commercial Malpractice
5 Titans Of Failure
Role Of Trustee

Representatives of the Government of the Republic of Cuba continue to regale audiences throughout the United States and in other countries with narratives of overwhelming desire by companies throughout the world to engage with the Republic of Cuba.

Unfortunately, there are too few corresponding narratives provided by the government of the Republic of Cuba to illustrate commensurate engagement and, specifically, desire becoming reality.  Companies have wanted to do more than the government of the Republic of Cuba has wanted them to do. 

The list of companies, including those within the United States, who want to export to, import from, provide services for, and invest within the Republic of Cuba is reported ever-increasing; the Ministry of Foreign Affairs (MINREX) and Ministry of Foreign Trade (MINCEX) offer they are inundated with proposals so much so that telephone calls (and voice mail) and correspondence (letters, emails, text messages) do not receive prompt responses- or a response.  

For most governments, an enviable challenge; for the government of the Republic of Cuba the activity represents a potentially harmful velocity by an ideologically-masked vehicle whose ultimate destination may be unknown, but whose ultimate result is certain: disruption and change; each unalterable.

If there are so many desirous, why has the number of United States companies with agreements to export to, import from, provide services for, and create direct investments within the Republic of Cuba remained unnaturally constrained?  

Since 17 December 2014, approximately fifty (50) United States companies have an operational presence (no direct foreign investment (DFI)) in the Republic of Cuba: The companies are primarily focused within the travel sector (supporting visitors from the United States who have the highest net-profit margin for any visitor to the Republic of Cuba) and further still focused upon bringing revenues to the Republic of Cuba.  Some companies have donated their products and/or services.  This operational presence does not include companies which export healthcare products, food products and agricultural commodities to the Republic of Cuba under provisions of statutes enacted in 1992 and 2000. 

If perhaps 2% of the meetings and receptions and conferences held since 17 December 2014 in Washington DC, throughout the United States and in Havana, not including the hundreds of delegations (official and unofficial) whose participants were representatives of United States companies meeting (usually) with representatives of MINREX and MINCEX had resulted in agreements, the bilateral commercial landscape would resemble today a formidable obstacle to any commercial, economic or political disruption.  Some would argue that the landscape would be impervious to interference.  That’s not what the government of the Republic of Cuba wanted; they preferred the interest to the reality.

The interest of United States companies served as bait for the government of the Republic of Cuba to entice the interest of companies in other countries.  It worked.  Unfortunately for the government of the Republic of Cuba, if one who is fishing runs out of bait (a marketplace that purportedly has revenues to support itself and companies seeking to participate in that marketplace), the fish (in this instance companies, financial institutions and governments) will turn elsewhere for nourishment.  That’s happening… and it shouldn’t.  

The commercial, economic and political elasticity of fifty-seven (57) years, the barrier from reality which protected the government of the Republic of Cuba from changes it abhorred, which maintained a rolling status quo, no longer exists.  There are no more lifeguards to cushion or harbor the Republic of Cuba.  Monies provided by benefactors with near-permanence and nearly devoid of obligation now require fiscal discipline, meaning political discipline… and change.

Tragically for the United States business community, the Obama Administration and the government of the Republic of Cuba engaged in eight (8) years of commercial malpractice.  That neither party modeled for an 8 November 2016 election outcome other than a victory for the nominee of the Democrat Party was both a preventable and catastrophic failure.  

Complicit, and yet-to-be held accountable in the multi-year series of undernourished opportunities are Members of Congress, advocates and lobbyists (both self-professed above-the-radar and below-the-radar), academics and commentators who insularly focused upon seeking legislative remedies rather than regulatory remedies and adhered to discussionary-exclusion.  Now, despite squandering the final twenty-five (25) months of the Obama Administration, they seek financial and political support from United States companies to create resistance to what the Trump Administration may implement.  Astounding audacity.

Remembering some of the most egregious Titans of Failure: 1) two commercial imports authorized- coffee and charcoal 2) 50% of what was required for direct correspondent banking 3) two meetings about certified claims in 2,923 days (766 days if calculated from 17 December 2014) 4) limited removal of financial transaction restrictions (complete removal would have encouraged banking and credit card/charge card/debit card activity) 5) Cabinet Secretaries disagreeing about whether their delegations could include representatives of United States companies.  However, more than two hundred (200) representatives of the United States government visited the Republic of Cuba during the final twenty-six months of the Obama Administration- including the President, First Lady, Second Lady and six (6) members of the Cabinet.

Although permitted by regulations implemented during the Obama Administration and thus far uninterrupted during the Trump Administration, why has the government to the Republic of Cuba not permitted representative offices (other than airlines), retail stores, distribution centers, assembly facilities, manufacturing operations, ferry services (even on a trial basis) and not permitted United States companies to directly export to the 200+ categories of licensed businesses?  Each of these activities are authorized by the Office of Foreign Assets Control (OFAC) of the United States Department of the Treasury, Bureau of Industry and Security (BIS) of the United States Department of Commerce, and United States Department of State.

Because of an ideological brake pad which impedes momentum, impedes efficiency, impedes creativity, impedes decision-making and most onerously impedes the cessation of conversation (ending “talk” and “talk about the talk” and embellishment and aggrandizing about “talk”), the pivot from nothing to something remains inconsistent and too often illusory; determining the glide-path from nothing or little to something has become an exhausting exercise.  

It’s almost as though the government of the Republic of Cuba wants United States companies to be uninterested as the result has more political value- victimization.  To whom does it have political value?  Isn’t a goal to create greater disposable income for the citizenry and diminish their dependence upon the government?  

The government of the Republic of Cuba needs to cease focusing upon the “embargo” and focus upon using existing United States statutes, regulations and policies to mitigate its impact upon the nation… that could have been a breathtakingly successful strategy from January 2009 through January 2017.

There are United States companies who believe they can provide value to the 11.3 million citizens of the Republic of Cuba; the government of the Republic of Cuba does not believe the management of those companies.  

The only means to determine if the suspicion by the government of the Republic of Cuba is warranted is to permit a presence, monitor that presence, evaluate that presence, and then determine its value.  That means accepting risk.  That means having confidence.

Thus far, the government of the Republic of Cuba is working the equation in reverse order- devoid of evidence; which potentially means more years of expensive “talk.”

The strategy of the government of the Republic of Cuba should be to take (make) advantage of the interest by United States companies.  

MINREX and MINCEX report that executives of United States companies want (in some instances described as “desperate”) into the Republic of Cuba marketplace- on terms that exist for companies in other countries who enter the Republic of Cuba marketplace.  Let them in.  

That generosity by United States companies to contravene prevailing political atmospherics in the United States is waning….  No company in the United States needs to access the Republic of Cuba marketplace; that’s difficult for an ego in the Republic of Cuba to absorb, but until it is appreciated the bilateral commercial, economic and political relationship will continue to be one of simultaneously tapping the brake and the accelerator.  A successful direction is not rotational.  

The government of the Republic of Cuba serves as trustee for the livelihood of 11.3 million occupants of the 800-mile archipelago.  Sometimes, acting against the interests of the trustee is acting for the interests of those who are served. 

There are sixty-eight (68) days until the OFAC, BIS, and Department of State issue their revisions to existing regulations.  

The distance in time until 15 September 2017 needs to be used wisely by stakeholders in Washington DC and in Havana.

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