May 27, 2004, Country World News
By Monnette Taylor
At a meeting in Houston on May 12, sponsored by the Texas-Cuba Trade Alliance (TCTA), attendees heard about the Texas trade potential with Cuba, as well as the legalities necessary to make it happen.
The TCTA was founded in February 2003, and "serves as an information and education source for Texas farmers, ranchers and food processors wanting to export to Cuba.
" According to Dr. Parr Rosson of the Center for North American Studies with the department of agricultural economics at Texas A&M University, Cuba was a major U.S. market for pork, beans, rice, animal feed, soybean meal, wheat and corn before the United States imposed a trade embargo in February of 1962.
In October of 2002, the U.S. Congress passed the Trade Sanctions Reform & Export Enhancement Act (TSREEA), which has strict stipulations, but does allow for agricultural trade with Cuba ... if you have all the proper licenses and certifications required.
While Cuba is not allowed to export to the U.S. market at the present time, it (Cuba) was a top supplier of sugar, fresh citrus and vegetables before the embargo was created.
While the markets are very "price sensitive," Rosson explained that Texas has a "big advantage" because of the close proximity to Cuba, and the quality of U.S. products.
Any producer or agribusiness manager who is interested in trading with Cuba needs to talk with an attorney and receive legal advice before deciding if this type of trade is right for individual companies or producers.
Cynthia Thomas of TriDimension Strategies, LLC, of Dallas serves as TCTA president, and according to TCTA literature, there is a potential to bring at least $57 million to the United States through exports to Cuba, and create at least 1,500 new jobs in Texas.
Thomas noted that anyone wanting to do business with Cuba needs to contact the Office of Foreign Asset Control (OFAC) of the U.S. Department of Treasury to apply for a travel license to go to Cuba, after a visit with an attorney. When that is accomplished, the Bureau of Industry and Security (BIS) must provide a license for the product being shipped to Cuba.
Rosson said there are 11.3 million people in Cuba, and the country imported $826 million of products in 2002. He explained, of that, $545 million was for food and agricultural products.
He estimates the U.S. export potential could be in the range of $450 million to $1.2 billion, annually. Marketable products that are needed include corn, sorghum, wheat, rice, oilseeds, meats (poultry and beef) and cattle. Also, flour, cotton, logs/lumber, fertilizer, seeds, herbicides and machinery are needed in Cuba.
Thomas explained it is necessary to make at least one trip to Cuba to talk with representatives of Alimport, the government food import agency, before attempting to bargain with them to export products. She explained they (Cuban government) are very eager to work with the United States, but said they believe in an 8-to-5 workday, with little nonsense, and expect it from U.S. exporters, too.
When entering the Cuban food market, the United States requires that you have the proper licenses necessary to trade; all sales are in cash or with Third Country financing; payment is in U.S. dollars; and have all the U. \S. Department of Agriculture certificates (sanitary/phytosanitary). The Cuban requirements are that you must go through Alimport and use a licensed customs broker. All Alimport employees speak English, so there is no language barrier.
Thomas noted it usually takes between four to six weeks to attain all of the necessary licenses. She said that while in Cuba, there are limits on the amount of cash visitors can spend per day, records of all money spent must be kept, and only cash may be carried.
In closing, Thomas said that while the Cubans are "truthful and focused, don't say you can do what you can't do!"