Eased Trade Restrictions with Cuba Would Benefit Agricultural Exports, ITC Says
The removal of Cold War-era trade restrictions with Cuba would likely increase U.S. agricultural exports to the country, according to a recently released report by the International Trade Commission (here) requested by the Senate Finance Committee. Experts recently highlighted the expected financial benefits of opening up trade with Cuba during a March 15 House Foreign Affairs Trade Subcommittee hearing (see 1603160001), the same day that the Office of Foreign Assets Control and the Bureau of Industry and Security relaxed several trade barriers between the U.S. and Cuba (see 1603150018). U.S. agricultural exports to the country peaked at $709 million in 2008 and fell to $149 million last year.
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U.S. agriculture exporters could play on a more level field with foreign suppliers if financial institutions could offer credit to Cuban entities, the report said. Also, U.S. products would derive a cost advantage from the production and marketing efficiency of U.S. exporters and the proximity of U.S. ports to Cuba, resulting in lower transportation costs and faster delivery times, ITC said.
Beyond agriculture, without existing U.S. export constraints, exports in several sectors would probably rise slightly in the short term, with prospects for bigger boosts in the longer term, dependent on changes in Cuba’s economic policy and growth, the report says. “Cuban nontariff measures and other factors may limit U.S. exports to and investment in Cuba if U.S. restrictions are lifted,” ITC said in the report’s executive summary. “These measures and factors include Cuban government control of trade and distribution, legal limits on foreign investment and property ownership, and politically motivated decision making regarding trade and investment.”
Senate Finance Ranking Member Ron Wyden, D-Ore., praised the report’s findings in a news release (here). "This report confirms a commonsense proposition: That there are significant economic opportunities for American producers if restrictions on U.S. trade with Cuba are eased,” Wyden said . “In particular, there are substantial opportunities for American agriculture, including dairy and wheat from the Pacific Northwest, and for goods manufactured in America, like construction machinery and building materials. At the same time, the U.S. must continue use all available economic and diplomatic tools to push Cuba to address its approach to the protection of human rights and to democratic reforms.”