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Politics

Trump to restore some restrictions on Cuba travel, targets island's military-run enterprises

The changes leave intact the greatest achievements of Obama’s Cuba legacy, including the restoration of diplomatic ties and the re-opening of the U.S. embassy in Havana, as well as the relaxing of travel restrictions and the reintroduction of regular commercial flights.
16 Jun 2017 – 9:02 PM EDT

President Donald Trump will announce a “readjustment” to U.S.-Cuba policy during a visit to Miami on Friday, tightening travel restrictions for Americans visiting the island and banning all financial transactions with Cuba's extensive military-run enterprises.

"The president vowed to reverse the Obama administration policies toward Cuba that have enriched the Cuban military regime and have increased the repression on the island," a senior White House official said in a conference call on Thursday.

The policy modifications are designed to restore some restrictions loosened by former President Barack Obama under his two-year-old effort to normalize U.S.-Cuba relations.

However, the changes leave intact the greatest achievements of Obama’s Cuba legacy, including the restoration of diplomatic ties and the re-opening of embassises in Havana and Washington, as well as the relaxing of travel restrictions and the reintroduction of regular commercial flights.

Cruise ship packages to Cuba which were launched last year will also be allowed to continue, as well as other commercial operations such as U.S. cellphone roaming in Cuba.

Travel for Cuban Americans and remittances sent to their families will also be unaffected. Trump even appears ready to allow Americans to bring back Cuban cigars and rum.

“It’s not as bad as I had feared, not as good as I had hoped,” said Pedro Freyre, a Cuban-born attorney who heads the international practice at the law firm Akerman in Miami and represents clients interested in doing business in Cuba. "Now we know what the rules are," he added, noting widespread speculation in recent weeks of harsher measures.


Commerce
Before Obama
The US allowed the sale of agricultural products to Cuba as well as some medical equipment, but no direct investment in the island. The US did not allow the import of any goods from Cuba. Financial dealings with the Cuban military were banned under the US embargo.
With Obama
Obama relaxed restrictions on commercial dealings with Cuba, including with the island’s extensive network of military-run enterprises. Obama also removed Cuba from a list of state sponsors of terrorism in 2015. Cuba had been on the list since 1982. Being listed subjects a country to U.S. restrictions on banking and financial cooperation as well as foreign aid.
With Trump
Trump will ban any financial transactions with military-run companies grouped under the holding company GAESA (Grupo de Administración Empresarial, S.A.) that controls 50% of Cuba’s economy, by some estimates.
Travel
Before Obama
The Bush administration tightened restrictions on travel and remittances. Cuban American families were only allowed to visit their relatives in the island for up to two weeks every three years. This applied only for immediate family (parents and children only). They could only send $300 quarterly in remittances. (i.e. $1,200 a year total). US travel to Cuba was strictly limited to journalists, US officials, the sale of US agricultural goods, as well as humanitarian, religious and medical reasons.
With Obama
Under Obama, 12 categories of legal travel to Cuba were created either in group packages or as individual “self-directed” tours, for culture, education, sports, religion etc. There was little effort to investigate or enforce violations.
With Trump
Trump will limit the category for “people-to-people” travel to group packages only. Trump will strictly enforce reporting requirements for U.S. travelers who will need to present documents showing their itinerary under one of the 12 categories. They will be subject to audit by the U.S. Treasury Department.
Embargo
Before Obama
The Bush administration loudly upheld the US embargo and fought off efforts in Congress to weaken it. It voted at the UN firmly against an annual resolution condemning the embargo.
With Obama
Obama criticized the long standing U.S. embargo on trade and commerce with Cuba, but made no effort to lift it in Congress. In 2016, he abstained at the United Nations in an annual vote to condemn the embargo.
With Trump
Trump will ban any financial transactions with military-run companies grouped under the holding company GAESA (Grupo de Administración Empresarial, S.A.) that controls 50% of Cuba’s economy, by some estimates.
Human rights and democracy
Before Obama
The US condemned Cuba’s human rights record including the lack of free, multi-party elections and the harassment and arrest of dissidents. It supported dissidents in Cuba via a USAID pro-democracy program.
With Obama
Obama continued the USAID pro-democracy program, but he did not directly tie his policy to human rights and democracy, though he did persuade Cuba to release dozens of political prisoners in 2015.
With Trump
Trump will demand that Cuba hold free elections and stop jailing political opponents before any improvement in relations can occur.


Stricter travel

Trump's policy will mean stricter enforcement of regulations governing travel to Cuba by U.S. travelers who are not of Cuban origin.

In future, travelers could be subject to a Treasury Department audit of their trip to check that it meets the permitted categories.
Obama's policy expanded regulations allowing many Americans to visit Cuba for the first time under a dozen categories, such as cultural exchanges, academic research or a loosely-defined purpose known as "people-to-people" travel.

As a result, the number of U.S. citizens traveling to Cuba leapt 74 percent from 2015 to 2016, according to Cuban government statistics.

Under Trump, those traveling in the “people-to-people” category will no longer be able to travel by themselves with their own itinerary, and will have to join a licensed group package.

The policy changes will not go into effect for 90 days while lawyers thrash out the regulatory details.

Trump is due to announce the new policy on Friday, at Miami’s Manuel Artime Theater, named after one of the late leaders of the 2506 Brigade that led the failed 1961 Bay of Pigs invasion of Cuba. During the campaign Trump visited the 2506 Brigade and promised to address their concern about Obama's normalization policy.

White House officials stressed that the new policy is a return to traditional efforts - abandoned by Obama - to force Cuba into abandoning its one-party, communist-run system and hold free, multi-party democratic elections. It also marks a partial victory for hard line Cuban American political leaders, led by Florida Senator Marco Rubio, who are fiercely critical of Obama’s Cuba policy, which was launched in December 2014 after months of secret talks with the Cuban government.

“If we’re going to have more economic engagement with Cuba, it will be with the Cuban people,” Rubio told the Miami Herald.

“All the pressure comes from American business interests that go to Cuba, see the opportunities and then come back here and lobby us to lift the embargo,” Rubio said. “I’m trying to reverse the dynamic: I’m trying to create a Cuban business sector that now goes to the Cuban government and pressures them to create changes."

On twitter Rubio highlighted a quote from a Cuban military website claiming that one military-run tourism company, Gaviota, welcomed nearly half of the visitors to Cuba in 2015.


Military spider's web

Cuba's military holding company, GAESA (Grupo de Administración Empresarial, S.A.), is the island's largest business empire and controls about 50 percent of the economy, according to some estimates.

It comprises at least 57 companies and is headed by Luis Alberto Rodriguez, the son-in-law of Cuban president Raul Castro.

"The Cuban military is an enormous spider that eats the smaller spiders around it," said John Kavulich, a long time Cuba watcher and president of the U.S.-Cuba Trade and Economic Council in New York. "It's appetite thus far has been insatiable," he added.

It was unclear how much the new policy would adversely affect the U.S. businesses that have invested in Cuba in the last two years, such as Airbnb and Google. Limiting individual "people-to-people" travel that could actually hurt Cuba's privately-run Aibbnb network.

A drop in U.S. travel to the island could also affect airlines that have begun flying to destinations across the island from a dozen U.S. cities.

The policy includes some exemptions including U.S. exports of agriculture and medicines via the military-run port of Mariel.

Critics of reversing Cuba policy point out that Obama's policy has enjoyed strong support nationally as well as among Cuban Americans.

"Don't be fooled. The Cuban people overwhelmingly want engagement with the U.S. - they know better than Trump what they need," " tweeted Ben Rhodes, who was Obama's senior adviser and former Cuba negotiator.

The new policy is also unlikely to push Cuba to reform, critics say. ""The Cuban system has proved its resilience to U.S. attempts at isolation over the past five decades," said Jason Marczak with the Atlantic Council, a Washington think tank that favors engagement with Cuba.

"A backtrack in our Cuba policy will only give new anti-US ammunition to countries like Venezuela, while making the U.S. approach to Cuba increasingly hard to defend among our allies."



In photos: After Obama's visit, Cubans still waiting for change

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