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Weekly Report - 18 December 2014 (WR-14-50)

Obama sets bold new course on Cuba

Barack Obama has made history – and cast his legacy – by becoming the first US President to make a decisive move to end the last Cold War anachronism in the Americas. On 17 December President Obama used his executive powers to decree a major change in US-Cuba policy, paving the way for the restoration of diplomatic relations after 53 years. “These 50 years have shown that isolation has not worked,” Obama said. “It’s time for a new approach.”

The US Congress, which will shortly be controlled by the Republicans, will endeavour to block, or at the very least hold up, the executive measures decreed by President Obama (see below). Only Congress has the authority to lift the reviled trade embargo on the island. Congress can also refuse to ratify any ambassadorial appointment by Obama to head a planned new US embassy in Havana, although Obama would be able to appoint a more junior diplomat to run the post. But none of this can detract from the scale of Obama’s unprecedented gesture, which will have repercussions throughout the region. The reaction in Latin America was unanimously positive. Even Venezuela’s President Nicolás Maduro recognised Obama’s “brave gesture”, which he portrayed as a victory for Fidel Castro’s pertinacity, as the US also released three convicted Cuban spies.

The first Latin American pontiff, Pope Francis, has also cast his legacy in helping to secure the historic breakthrough, which was announced on his birthday. Cuba’s President Raúl Castro gave a brief televised address at the same time as Obama. After a long preamble which made up half of his address, he said, with classic understatement, that “we have been able to make headway in the solution of some topics of mutual interest for both nations”. Only towards the end did he mention that “We have also agreed to renew diplomatic relations”, before concluding that “We must learn the art of coexisting with our differences in a civilized manner”.

The well-known Cuban dissident blogger Yoaní Sánchez was critical of Obama’s move, fearing that the government in Havana would use it to bolster its legitimacy; and critics questioned the lack of any requirement for Castro to initiate a democratic opening or improve human rights in Cuba in exchange for Obama’s undertaking. In an editorial the conservative Washington Post went as far as to suggest that Obama was throwing Cuba a lifeline when the trade embargo, which has failed to achieve its objective in half a century, was close to achieving its aim: “Mr. Obama may claim that he has dismantled a 50-year-old failed policy; what he has really done is give a 50-year-old failed regime a new lease on life.”

The majority of Americans, however, including many Cuban-Americans in the key swing state of Florida, favour normalising relations, according to a nationwide poll carried out by the Atlantic Council earlier this year, and are likely to back Obama’s move, which follows fast on the heels of his earlier executive action on immigration policy which, it has now emerged, was also encouraged by Pope Francis.

The details of the story behind the announcement were as fascinating as the announcement itself, with a full 18 months of secret talks facilitated by Canada and the Vatican since mid 2013 and Pope Francis recently penning personal letters to Presidents Obama and Castro asking for the release on humanitarian grounds of the US government sub-contractor, Alan Gross, in jail in Havana since December 2009 on charges of acts against the Cuban State. The 68-year old Gross has arrived back in the US. Also released from jail were the three remaining members of the ‘Cuban Five’ - Gerardo Hernández, Antonio Guerrero and Ramón Labañino - Cuban intelligence agents arrested in Miami in 1998 and convicted of espionage (two had already been released following completion of their sentences). These were apparently ‘swapped’ for a key US intelligence agent who has been held in Cuba for two decades (thereby allowing the US to say that Gross was not part of any ‘exchange’).

The unknown agent, described by Castro as “a spy of Cuban origin who was working for [the US]”, was called a hero by Obama, who said he had been critical to US operations in past years. Brian P. Hale, director of public affairs for the Office of the Director of National Intelligence, released a statement saying that “Information provided by this person was instrumental in the identification and disruption of several Cuban intelligence operatives in the United States and ultimately led to a series of successful federal espionage prosecutions.” This included the “information that led to the identification and conviction of Defense Intelligence Agency (DIA) senior analyst Ana Belen Montes; former Department of State official Walter Kendall Myers and his spouse Gwendolyn Myers; and members of the Red Avispa network, or ‘Wasp Network,’ in Florida, which included members of the so-called ‘Cuban Five’.” Hale concluded that his “swap for three of the Cuban spies he helped put behind bars is fitting closure to this Cold War chapter of U.S.-Cuban relations”.

Cuba has also agreed to release 53 prisoners identified as political detainees by the US (Cuba denies having any political prisoners). Again, the identity of these dissidents is unknown. Cuba released 75 dissidents in 2010 and 2011 following mediation by the Vatican and the Spanish government. Spain’s foreign minister, José Manuel García-Margallo, who recently visited Havana, said he welcomed “a new stage, which puts an end to a disagreement that has lasted for 50 years”. He stressed, however, that the future in Cuba “can only be built on the basis of respect for democracy and human rights”.

Main measures

The big symbolic move by the US is a promise to restore an embassy in Havana, where former president Jimmy Carter (1977-1981) established an Interests Section in 1977. Obama also announced a range of new measures aimed at facilitating travel, telecommunications and commercial links. Obama did everything he could within the confines of his executive power to promote direct bilateral economic relations with Cuba, but only Congress can repeal the 1961 trade embargo on Cuba, which in 1996 was codified into US legislation under the Helms Burton Act, which explicitly states that the embargo cannot be lifted until the Castros leave power. Republicans will fight tooth and nail to ensure the letter of the law is enforced. It is worth noting that one of the fiercest critics of normalising ties with Cuba, Republican Senator Marco Rubio (Florida), will become chairman of the panel overseeing Western Hemisphere relations in January.

Congress also holds the key to allowing direct and unrestricted tourism to Cuba. But the flow of US visitors to Cuba should increase significantly after Obama made general the various categories of travel licences that previously required approval on a case-by-case basis. He also authorised direct financial transactions between the US and Cuba. Travellers to Cuba will be able to use US credit and debit cards. Obama also lifted the level of permitted remittances sent from US citizens to Cuban relatives from US$500 to US$2,000 per quarter, and travellers will be able to bring in US$3,000 in remittances. Republicans argue that this influx of US dollars will help bolster the Castro regime.

US Secretary of State John Kerry will review Cuba’s designation as a state sponsor of terrorism. Cuba has long petitioned for its removal from that list, which would also facilitate its access to sources of external financing. Finally, good news for US cigar lovers. Licensed US travellers to Cuba will be able to return with US$400 in Cuban goods, including tobacco and alcohol products worth less than US$100 combined. This effectively means that the longstanding ban on importing Cuban cigars is more or less at an end, albeit with limits.

  • Unbridled regional delight

Latin American leaders heralded the announcement as a major step forwards for regional integration. Brazil’s President Dilma Rousseff said it marked a “change in civilization”. Brazil, which has favoured quiet relationship-building with the Castro government in recent years, now stands to benefit from its significant investment in the Cuban port of Mariel development project. Mexico’s President Enrique Peña Nieto applauded the “decisive and historic step”, sentiments echoed by José Miguel Insulza, the secretary general of the Organization of American States (OAS).

It was noteworthy that in concluding his statement President Obama declared: “This April, we are prepared to have Cuba join the other nations of the hemisphere at the Summit of the Americas. But we will insist that civil society join us so that citizens, not just leaders, shape our future.” Panama is hosting the OAS Summit of the Americas on 11 and 12 April, and had confirmed on 12 December that Cuba would attend for the first time.

A potential loser in all of this could be Venezuela’s President Maduro, who may now find himself a little isolated in the region in his vitriolic anti-US rhetoric. His allies Rafael Correa of Ecuador and Evo Morales of Bolivia have been more measured in their rhetoric latterly, suggestive of tentative efforts to rebuild ties with Washington. Diplomatic efforts by the Vatican earlier this year (and backed by the US) to foster internal dialogue in bitterly-polarised Venezuela failed, but are said to be ongoing behind the scenes. End box

  • Groundbreaking Farc gesture

On the very same day as the momentous US-Cuba announcement, there was another significant development in Havana in the bid to bring to a close the region’s other longstanding intractable conflict. ‘Iván Márquez’ (Luciano Marín Arango), head of the negotiating team of the Fuerzas Armadas Revolucionarias de Colombia (Farc), read a statement declaring an indefinite unilateral ceasefire, which he said “should be transformed into an armistice”, as the Colombian peace process enters the home straight.

The Farc said the ceasefire would begin on 20 December and, unlike previous unilateral ceasefires declared by the guerrilla group (during presidential elections and Christmas holiday periods), this one has no pre-established end point. The Farc attached one major condition, however: the ceasefire will end if the guerrillas come under attack from the Colombian armed forces. This is an attempt to force President Juan Manuel Santos to accept the bilateral ceasefire he has resisted since the peace process began on the grounds that the Farc would merely misuse it to regroup militarily.

Santos did recently accept that while a bilateral ceasefire was out of the question, “this doesn’t mean that in the course of the talks the first steps towards de-escalating the conflict cannot be taken.” He might just be tempted sooner rather than later to make a bold move on this front himself. After Obama’s historic announcement, Santos tweeted that the US policy change on Cuba “will change the history of the hemisphere”, and he too wants to cement his legacy by being the President that delivers peace with the Farc: “Cuba and the US are an example of however large the differences which divide us, with dialogue and perseverance it is possible to resolve them.”

  • Excerpts from President Obama’s address

“To those who oppose the steps I’m announcing today, let me say that I respect your passion and share your commitment to liberty and democracy. The question is how we uphold that commitment. I do not believe we can keep doing the same thing for over five decades and expect a different result. Moreover, it does not serve America’s interests, or the Cuban people, to try to push Cuba toward collapse.....Change is hard – in our own lives, and in the lives of nations. And change is even harder when we carry the heavy weight of history on our shoulders. But today we are making these changes because it is the right thing to do. Today, America chooses to cut loose the shackles of the past so as to reach for a better future – for the Cuban people, for the American people, for our entire hemisphere…..Todos Somos Americanos”.

 

  • US companies line up

Despite the anticipated congressional moves to block or water down implementation of the new policy changes, potentially by holding up new funding for the Department of Homeland Security (for which funding recently expired), US companies clearly stand to benefit moving forward. Within hours of the White House announcement the financial newswire Bloomberg reported that the US$45m Herzfeld Caribbean Basin Fund, comprising companies that stand to benefit from the removal of US trade restrictions with Cuba, rose 29%, the most since April 2009. The fund includes the airline Copa and Coca-Cola bottler Femsa, among others.

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