The holes in the blockade on Cuba

Opinion

Hey there, time traveller!
This article was published 08/07/2024 (456 days ago), so information in it may no longer be current.

I’ve been thinking, and reading, a great deal about the U.S. embargo of Cuba. It was a major point of conversation during my May trip to the island.

Let me say from the outset that I’m certainly no fan of the U.S. sanctions regime against Cuba, and neither are a good many Cubans. Moreover, the government in Havana has been using the blockade for propaganda purposes for 65 years now.

But I am wondering about how religiously or rigidly the blockade is being enforced by the current U.S. government. When I asked about it, one Cuban was quick to opine: “The embargo has more holes in it than Swiss cheese.”

More strikingly, he maintained that most Cubans don’t believe that the U.S. blockade is primarily responsible for their economic travails. Economic mismanagement by the government, the socialist system itself, an overly bureaucratic apparatus with vested interests in maintaining the status quo and a governmental unwillingness to veer too far from the revolution’s ideals are all important explanatory variables.

Having said that, I’m never really sure that I understand the full nature and extent of the U.S. embargo of Cuba. For the most part, the U.S. sanctions regime, both national and extraterritorial, is all about punishing and isolating Cuba — through trade, investment and international financial restrictions.

It is important to note that the financial sanctions part of the blockade, which involves restrictions on foreign banks, a banning of dollar-denominated commercial transactions and access to the international payments system or SWIFT, are particularly onerous on Havana.

So, how tight is the embargo? In other words, does the U.S. executive branch have wide discretion when it comes to the enforcement of the blockade?

Furthermore, if most other countries are not bound by the U.S. sanctions regime, what is that Cuba doesn’t get from the U.S. that it can’t get from one of these other countries? Does Cuba not get crude oil, for example, from Mexico, Venezuela and others? Are there not also ways for Cuba to conduct commercial activities through third countries, to create shell companies and to sell Venezuelan oil on the black market?

How much of Cuba’s problem is not about getting access to imported goods and produce and more about not having the hard currency to pay for it? For the longest time, Cuba was getting by on credit, borrowing money from friendly countries, subsidization and favourable contract arrangements.

But those days appear to be over now. There were reports when I was in Cuba that two oil tankers from Algeria would not dock because the Cuban government was unable to pay for the product.

More significantly, there is all kinds of chatter in Cuba about the growth of micro, small and medium-sized private enterprises (known as “mipymes”) — numbering somewhere north of 11,000 entities. I saw privately owned grocery stores, bakeries, modified transport buses, fruit stands and coffee shops. And I even darkened the doors of a certified private restaurant in Cienfuegos.

Through a somewhat convoluted process, food from the U.S. (mostly from Miami) is getting to Cuba through private commercial means — and private entrepreneurs should soon be able to open bank accounts in the U.S. The food is bought in Florida (in some cases by family members in Miami or by small business entities), oftentimes transported daily to the island, and then delivered to various communities (to individuals and businesses) throughout Cuba via Cuban operators.

I have no real sense of what the volume and dollar amounts are. But a Cuban friend told me that every day he sees a number of Mercedes-Benz trucks racing through his town and making a host of food deliveries.

Not only is off-island food making its way to Cuba, but so too are expensive U.S. vehicles. I witnessed with my own eyes trucks, less than five years old, built by GMC and Ford. I was told that these vehicles are being brought in for some Cubans and paid for by family members in the U.S.

Apparently, they are able to bypass the U.S. embargo because these items are viewed in Washington as helping to improve living conditions for the Cuban people. These types of transfers are being approved via a licence granted by U.S. President Joe Biden and implemented by the U.S. Treasury Department. Again, it was told to me that the Cuban government benefits financially to the tune of roughly US$30,000 in fees for each vehicle imported for simply authorizing the appropriate documents.

Don’t get me wrong, though. I still believe that the U.S. embargo hurts individual Cubans and the overall Cuban economy.

But I am beginning to wonder if the blockade is the proximate reason for what ails contemporary Cuban society. Of course, my doubts about the blockade’s true impact today haven’t altered my view that the embargo’s best-before-date has long since expired.

Peter McKenna is professor of political science at the University of Prince Edward Island in Charlottetown.