Copyright Joe Raedle, Getty Images
Havana, Cuba

Is Cuba Ready for Life without US Trade Embargo?

Jan. 8, 2015
The lifting of U.S. sanctions would allow an injection of U.S. capital into Cuba's economy and the introduction of new products in a market that is light years away from the levels of a typical Western consumer society.

As U.S. President Barack Obama prepares to ask Congress to lift the Cuban trade embargo -- in line with his decision to normalize diplomatic ties -- some Cubans wonder if they're ready for such an economic tidal wave.

The embargo outlawing most economic and financial transactions with the communist-run island was decreed in 1962 by then president John F. Kennedy and severely toughened under the so-called Helms-Burton law of 1996.

The Havana government regularly cites the embargo as an impediment to Cuban development. Damages -- the opportunity cost of all the trade that never happened -- are often estimated by Cuban officials at $100 billion over 50 years.

But for the time being, prospects for Cuban exporters seem limited. 

Only rum and Cuba's famed cigars seem to have real potential to make inroads in the U.S. market. However, they account for just $600 million a year in export revenue, less than 4% of Cuba's $17.5 billion-total.

Cuba's top export, generating $11 billion in revenue, are professionals, including doctors. But physicians are not needed in the United States.

And Cuban-made medicines, which account for $900 million a year in export revenue, would have trouble obtaining approval in the U.S., which has some of the strictest regulations.

Cubans could also find their access to movies and computer software drastically changed. Currently, under the shelter of the embargo, Cubans pirate much of their content, but if the sanctions are lifted they would have to honor copyrights and pay.

But for better or for worse, said Esteban Morales, a specialist on U.S.-Cuban relations, the country would have to get used to life without sanctions the same way it got used to the embargo in the first place.

"What are we going to say, 'postpone the lifting of the sanctions, because we are not ready'?"

--By Carlos Batista

Copyright Agence France-Presse, 2015

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