Partnership backs open trade with Cuba
WASHINGTON, D.C. – Building on the success of a May mission that netted $10 million in trade agreements with Iowa companies, the Greater Des Moines Partnership has stepped up its support for normalized commerce with Cuba, announcing a new initiative during the business group’s annual lobbying trip to the nation’s capital June 11-13.
Partnership Chairman Steve Zumbach outlined the details of a multi-pronged initiative for open trade with Cuba during a reception at the Cuban Interests Section on June 11. Open trade would allow Iowa to capture part of the $1 billion market in food and agricultural products to Cuba imports from non-U.S. sources annually. Iowa stands to gain nearly $70 million in potential sales to Cuba, according to the Partnership.
Specifically, the Partnership advocates immediately:
o Ending the travel ban;
o Easing restrictions and regulations on agricultural exports;
o Approval of an amendment to the 2000 Trade Sanctions Reform and Export Enhancement Act that would expand the definition of agricultural products to include agricultural machinery and food processing equipment; and
o Maintaining people-to-people programs to reduce tension between the two nations.
For the longer term, the Partnership advocates an end of the 40-year embargo on selling goods to Cuba, normalization of economic and political relations between the two countries, and reducing political tensions.
Cuba has emerged as a growing market for U.S. food and agricultural products since 2001, when Congress allowed more transparent trade with the communist country, including cash sales of food and medicine.
Since trade restrictions have been lifted, Iowa interests have exported nearly $25 million worth of grain to Cuba, Iowa Secretary of Agriculture Patty Judge said at the reception. Iowa and Arkansas are the two states poised to benefit most from normalized trade relations between the two countries, she said.
Negotiations are currently in the works for the export of meat, eggs and other food products. Wells Dairy Inc. sent two containers of Blue Bunny ice cream to Cuba, and efforts are under way to tap the island nation as a market for distiller’s grain, a byproduct of ethanol production, which would be used to provide protein for livestock.
Judge praised the Partnership’s initiative, saying it’s “the right thing for you folks to do” to increase business opportunities for Iowa farmers and agribusinesses in Cuba.
The Partnership’s agenda requires “pretty heavy lifting,” said Congressman Leonard Boswell, D-Iowa, who traveled to Cuba in May with Judge and other officials. The Bush administration has taken a hard stand against normalizing trade relations, and those objections won’t be easily overcome, he said.
“But,” Boswell said, “the fact that we are going down there and are having some successes demonstrates what we do rather than what we say.”
Normalized trade relations with Cuba not only would increase opportunities for Iowa farmers and agribusinesses to tap a new market, but also might help relieve the stress on Cuba’s limited financial resources. Products imported from the United States would be significantly cheaper than those currently imported from Europe because of lower transportation costs.
“It’s the right thing for the Cuban people,” Judge agreed. “It’s the right thing for the people of Iowa.”
Tom Rial, director of government and international relations for the Partnership, said that though the congressional act of 2001 eased restrictions, it’s still cumbersome for U.S. exporters to trade with Cuba and some companies have shied away from opportunities. A license isn’t needed to ship agricultural products, but the U.S. Commerce Department requires exporters to fill out the same forms for every contract sale they make.
Rial said Iowa exporters are focusing on building strong relationships with the future leaders of Cuba, who “no longer see us as a bunch of bad people.”
The ability to participate in a free market could accentuate positive aspects of the Cuban society, including a high literacy rate, low infant mortality rate, universal access to health care and a new focus on tourism, and make it “a bright spot of the Caribbean,” Rial said.