Miami Herald
November 16, 2001
By Tim Johnson

WASHINGTON -- U.S. grain vendors on Thursday celebrated a decision by Cuba this week to buy up to $10 million in food and medicine supplies from the United States to deal with Hurricane Michelle's devastation.

"We're very excited about it," said Audrae Erickson of the American Farm Bureau. "We believe it's the beginning of rebuilding our trade relationship with Cuba."

Grain dealers said the historic agreement -- which is likely to produce the first U.S. commercial exports to Cuba in four decades -- could ignite broader lobbying efforts to relax a 40-year-old U.S. trade embargo of Cuba.

"It really does start the engines revving on U.S. interests in sales to Cuba," said Pamela Falk, a law professor at the City University of New York and frequent advisor to U.S. farm groups interested in selling to Cuba.

Already, a Cuban purchasing agency has contacted 12 U.S. companies to inquire about purchases of wheat, soy, flour, corn and rice. Inquiries are expected for wood products, baby food, powdered milk, poultry, cooking oil, beans and medicines, the U.S.-Cuba Trade and Economic Council said.

The New York-based group said Havana wants all purchases shipped by Dec. 10.

The State Department gave new assurances that it would facilitate the emergency sales.

"Given the humanitarian nature of their request, we will consult with other government agencies and seek to expedite authorization of approved sales," said Charles Barclay, spokesman for the State Department's Bureau of Western Hemisphere Affairs.

Hurricane

Observers of U.S.-Cuba relations said the devastation of Hurricane Michelle gave Cuba a way to change policy on purchases of U.S. food and medicine without appearing to back down on a previous refusal.

Thirteen months ago, Cuban Vice President Carlos Lage warned that the island nation would not buy "a single grain of rice or a single aspirin" from the United States unless Washington lifted the U.S. embargo. He made the remark after Congress enacted a law allowing cash sales of food and medicines to Cuba, but prohibiting Cuba from using U.S. banks or government entities to finance Cuban purchases.

In an about-face from that earlier stance, the government of President Fidel Castro said Nov. 8 that it would pay cash for U.S. goods. It also agreed to use U.S. vessels or ships from third countries to ship the goods.

Doing a 180

"This is Fidel doing a 180," said a U.S. official, speaking on condition of anonymity.

A variety of factors led Havana to the change, analysts said, including a sharp drop in tourism following the Sept. 11 terror attacks in the United States, and heavy damage from the Nov. 4 hurricane to the key sugar cane and citrus industries.

Another major apparent factor was Havana's realization that U.S. farm interests were growing irritated over Cuba's decision not to purchase U.S. goods despite the more relaxed rules.

Although the Commerce Department implemented regulations at the end of July outlining procedures for cash sales to Havana, Cuba balked at actually buying anything.

"The U.S. agribusiness lobby threw up its hands to some extent," Falk said.

Disappointment

The disappointment set in among powerful U.S. interests that have been instrumental in pressuring legislators to relax trade sanctions on Cuba.

"A lot of people watching the Cuba debate have seen the wind go out of the agricultural sector sails a bit," said Gillian Gunn Clissold, director of the Caribbean Project at Georgetown University.

With the need for hurricane relief, "it was a face-saving way out for the Cuban government to modify its policies on purchases of food," Falk said.

Even as U.S. grain vendors welcomed the sales, the trade group warned against excessive enthusiasm.

Admonition

"No United States-based company should be signing up for conferences on 'How to do business with the Republic of Cuba' based upon these sales," the U.S.-Cuba Trade and Economic Council told its members in a mass e-mailing.

The e-mail from the trade council, which advocates greater trade with Cuba, said U.S. concerns contacted by Cuba about sales include Archer Daniels Midland of Decatur, Ill., Arkansas-based Riceland Foods and Cargill Inc. of Minneapolis, Minn.

Slight profit

The director of the U.S.-Cuba council, John Kavulich, said U.S. businesses plan to sell to Cuba at cost or with only slight profit. He said he expected the one-time food and medicine sales to revive efforts by farm-belt legislators to seek a further relaxation of the four-decade-old U.S. embargo.

"There is a potential upside to this," Kavulich said. "Some members of Congress who have been supportive of a [trade] relationship [with Cuba] will be energized."

Cuba currently buys between $700 million and $1 billion in foodstuffs from U.S. competitors each year, primarily Vietnam, France and Argentina.

"We believe that a $1 billion market -- and one that might grow once American tourists arrive there -- is one worth pursuing," Erickson said.

Cuba calls U.S. offer of aid positive and says it's ready for normal relations with Washington