Photo by Tabrez Syed

1 February 2021, Issue 1083

The Biden White House has confirmed that it will review the former Trump administration’s policy towards Cuba. Speaking on 28 January the White House press secretary, Jen Psaki, said that in doing so the new administration “will take its own path”.

In answer to a question, she said that future US policy towards Cuba will be governed by two principles. The first will be, “support for democracy and human rights” which will be at the core of the administration’s efforts; and the second is that “Americans, especially Cuban Americans are the best ambassadors for freedom in Cuba”.

“So we’ll review the Trump administration policies as we are in a

number of other areas of national security with an eye to ensuring that our approach is aligned with that. But we will take our own path”, she said.

Her remarks confirm comments made by the incoming US Secretary of State speaking at his confirmation hearing before the Senate Committee on Foreign Relations (Cuba Briefing 25 January 2020). Then, Antony Blinken, the US Secretary of State designate, appeared to indicate that the Biden Administration may review Cuba policy sooner rather than later. In reply to a question from Senator Marco Rubio (R-Florida), Blinken said that he proposed to review “very very quickly” whether the Trump administration’s policies were having the objectives intended, while appearing to accept that, more generally, pressure on Cuba would continue. Blinken’s comments and others by Biden appointees suggest that the areas of rapid movement could be in relation to the restoration of US travel, remittances, staffing the US Embassy in Havana, and dialogue with the Cuban government.

In a related development the US Congressman, James McGovern (D-Massachusetts), who is the Chair of the House Rules Committee and a senior member of the House Agriculture Committee, has published the text of a letter written on 15 January to then President-elect Biden, seeking the restoration of relations with Cuba.

In it, he urged the new administration to “act early, quickly and comprehensively to reverse all Trump- imposed policies, restrictions and sanctions against Cuba”. McGovern said that he believed that adopting an incremental approach would be a mistake and acting now on Cuba would free up the Biden White House to focus on other high priority Latin American challenges and opportunities.

McGovern proposed that Cuba be removed from the State Sponsors of terrorism list, the Presidential waiver on Title III of the Helms-Burton Act be restored, and US non-profit and private sectors ‘be given ample space’ to advance relations, programmes and projects.

The Congressman who travelled to Cuba with President Obama in March 2016, and is close to President Biden, also wrote that like the President he believed that the American people are the best ambassadors and that restoring their ability to travel ‘to support and re-establish relationships with the Cuban people’ would bring significant benefits.

McGovern proposed the restoration of a fully functioning US Embassy with consular services and the reestablishment of collaborative working groups on human rights, economic and financial reforms, and the restoration of previous collaborative working groups on law enforcement, national security cooperation, migration, human trafficking, environmental cooperation, and counter narcotics operations. The letter can be read at https://mcgovern.house.gov/news/documentsingle.aspx?DocumentID=398665

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Photo by Chris Hardy

25 January 2021, Issue 1082

The European Union’s High Representative, Vice-President Josep Borrell, has criticised the inclusion of Cuba in the US list of state sponsors of terrorism.

An EU statement following the third EU-Cuba Joint Council meeting noted that Borrell regretted that the decision by the outgoing Tump administration “will have a negative impact on foreign direct investment in Cuba and will further aggravate the already difficult situation of the Cuban people in the midst of the pandemic”.

The EU described as “fruitful” the 20 January meeting held virtually with Cuba’s Minister of Foreign Affairs, Bruno Rodriguez, and senior Cuban officials.

According to Cuban and EU reports, the exchanges considered the overall state of EU-Cuba relations and reviewed the various lower-level dialogues that have taken place in the framework of the EU-Cuba Political Dialogue and Cooperation Agreement (PDCA). There was, however, a more detailed dialogue on the impact of US sanctions on the Cuban economy and on EU trade and investment interests. The meeting also considered the economic reforms Cuba is undertaking which the EU said it was “ever ready to support” …. “in the interest of all”.

Other issues discussed included confirmation of EU support for the now delayed annual UN resolution condemning the US embargo, the EU’s continuing opposition to the application of Titles III and IV of the Helms-Burton Act, and development co-operation.

The Cuban media quoted Bruno Rodríguez, the Cuban Foreign Minister as saying in his introductory remarks that the continuity of the political dialogue with the EU confirmed that “it is possible to build spaces for dialogue and cooperation for mutual benefit, while respecting our differences.”

Rodríguez was also said that the COVID-19 pandemic indicated the urgency of strengthening multilateralism and cooperation and suggested that there were additional opportunities for cooperation with the EU. Speaking specifically about the PDCA, he said that Cuba particularly valued the mechanism for discussing unilateral coercive measures (sanctions).

Rodríguez said that the meeting was an indication that relations between Cuba and the EU were progressing, and emphasised Cuba’s commitment to working to preserve and consolidate the relationship created in recent years.

High level participants on the EU side included Arancha Gonzalez, the Spanish Minister of Foreign Affairs, EU and Cooperation, Jutta Urpilainen, the EU Commissioner for International Partnerships, and representatives of other EU Member States; all of whom Rodríguez described as “vital actors in the implementation of the EU-Cuba PDCA”.

Speaking a day after the Joint Council, an EU spokesperson said that the EU continued to oppose the US embargo and said that it will continue to express this to the new US administration.

The online Brussels-based EU Observer quoted her as dismissing the US decision to name Cuba as a terrorist sponsor, noting that the reason that Cuba had hosted members of Colombian insurgent group the National Liberation Army (ELN), was because of the Colombia and EU-backed peace process, which the spokesperson said the EU still wanted to facilitate. “This will only aggravate the already difficult situation of the Cuban people in the midst of the pandemic,” she told the publication.

The publication also quoted Cuba’s Ambassador to the EU, Norma Goicochea, as saying that ‘EU support in persuading Biden to overturn Trump’s measures was “very important” for Havana’.

The Caribbean Council is able to provide further detail about all of the stories in Cuba Briefing. If you would like a more detailed insight into any of the content of today’s issue, please get in touch

Photo by Ricardo IV Tamayo

In the dying days of the Trump administration the US State Department has again designated Cuba as a ‘State Sponsor of Terrorism’. The decision could slow efforts by the incoming Biden administration to take calibrated steps to gradually restore US-Cuba relations.

The decision to redesignate by the US Secretary of State, Mike Pompeo, was taken with little external consultation and, according to Reuters, was subject to months of legal review, with some administration experts questioning whether it was justified. The decision effectively broadens the US definition of terrorism.

In an 11 January statement, Pompeo said that Cuba has “repeatedly provided support for acts of international terrorism in granting safe harbour to terrorists”. He also alleged that Cuba had “fed, housed and provided medical care for murderers, bombmakers and hijacker” while, he said, “many Cubans were hungry, homeless and without basic medicine”. Pompeo additionally indicated that by supporting Venezuelan President Nicolas Maduro, Cuba had enabled “a permissive environment for international terrorists to live and thrive within Venezuela.” He also justified the decision by referencing Cuba not having extradited ten Colombian ELN guerrilla leaders from Havana when peace talks with the Colombian government broke down in 2017, comments that sought to set aside the existence of protocols agreed by all parties guaranteeing safe passage home for all participants.

The listing, Pompeo said, was intended to hold the Cuban government accountable and “send a clear message: the Castro regime must end its support for international terrorism and subversion of US justice”.

The decision has the effect of subjecting Cuba to sanctions that penalise persons and countries engaging in trade with Cuba, restricts US foreign assistance, bans defence exports and sales, and imposes export controls on some dual use items. It also requires the US to oppose loans to Cuba by institutions such as the World Bank and the International Monetary Fund. For the most part the substance of the designation is academic, but it effectively chills relations, creates uncertainty for US and international investors, and makes more difficult the gradual easing of restrictions expected under the incoming Biden administration.

The decision, just nine days before President elect Joe Biden is sworn in, was fiercely rejected by the Cuban government, and met with dismay by countries around the world hoping for an improvement in US-Cuba relations.

President Díaz-Canel said on Twitter that the “cynical categorisation (of Cuba) as a State sponsor of terrorism” was “the death throes of a failed and corrupt administration committed to the Cuban mafia in Miami”. Also writing on Twitter, Cuba’s Foreign Minister, Bruno Rodríguez noted that the US decision would be recognised as “political opportunism” by those “who are honestly concerned about the scourge of terrorism and its victims.”

Criticism also came from the new chairman of the House Foreign Affairs Committee, Congressman Gregory Meeks (D-New York) and other members of the House and Senate. Meeks told AP that the move sought only to tie the hands of the Biden administration. “This designation of Cuba as a state sponsor of terrorism with less than a week to go in his presidency and after he incited a domestic terror attack on the US Capital … that’s hypocrisy”, the news agency quoted Meeks as saying.

The decision by President Obama to remove the designation of Cuba as a state sponsor of terrorism in 2015 was an important step towards restoring diplomatic relations and enabling his policy of détente to move forwards and for him to visit Havana in 2016.

During the election campaign President elect Biden said that he would promptly reverse the Trump administration’s policies on Cuba that “have inflicted harm on the Cuban people and done nothing to advance democracy and human rights.”

In media comments late last year, Juan Gonzalez, Biden’s choice for Senior Director for the Western Hemisphere at the National Security Council, said that while he expected the incoming administration will continue to press for change in both Venezuela and Cuba, it will have clear objectives and seek multilateral solutions.

In Cuba’s case the intention of the Biden White House is to ease restrictions on US travel and remittances, as a part of an incremental strategy aimed at helping the Cuban people. However, the eleventh-hour sanctions imposed by Pompeo – seen in Washington as one of several signals that he is preparing to run for the Republican Presidential nomination in 2024 – has the effect of delaying any decisions on Cuba policy until a further review of the terrorism designation is undertaken. Syria, Iran, and North Korea are other countries on the US list.

The Caribbean Council is able to provide further detail about all of the stories in Cuba Briefing. If you would like a more detailed insight into any of the content of today’s issue, please get in touch

Photo by tiago claro

Cuba’s state insurance company ESICUBA (Seguros Internacionales de Cuba SA) has issued an official note indicating how the process of monetary and exchange rate unification will affect its clients both individual and corporate. ESICUBA reported that following currency unification on 1 January all current policies will maintain current rates, until expiration.  It said that Current policies written in Cuban Peso (the CUP) will maintain their terms and conditions. Current policies in Cuban Convertible Pesos (the CUC) whose policyholders are Cuban citizens and foreigners will see values, insured limits and premiums revalued to the CUP at the exchange rate of CUC1 to CUP24, while all other terms and conditions will continue to apply.  

ESICUBA also said that current policies issued in CUC whose policyholders are legal entities (state companies, Cuban mercantile companies, joint ventures, Asociación Internacional Economica (AEI), foreigners, and state budgeted units) will convert their values, insured limits and premiums to CUP at the exchange rate of 1 to 1, maintaining all other terms and conditions. The company said that all current policies issued in foreign currency will keep their values, insured limits and premiums expressed in the currency in which they were written until their expiration. All operations and transactions (payment of premiums, payment of indemnities, returns of premiums, bonuses) must, ESICUBA noted, be modified to CUP at the official exchange rate against foreign currencies, as determined by the Central Bank of Cuba, while maintaining all other terms and conditions. It further noted that medical expense insurance will retain the same level of service, but values ​​and premiums must be recalculated to CUP at the exchange rate of 1 to 24, while   travel insurance will retain its same terms and conditions expressed in foreign currency. ESICUBA noted that in each case the currency modifications will be included by endorsement of the policies concerned and renewals and new policies will now be written in CUP based on the risk declaration made by each client. The company said that all legal entities local and foreign now needed to assess the sufficiency of their insurance in terms of values ​​and insured limits in the event of the occurrence of a covered claim

11 January 2021, Issue 1080

President Díaz-Canel has called on Cubans to exercise greater responsibility to drastically reduce the spread of a third outbreak of the COVID-19 pandemic which is reported to have reached a new peak.

Leading a meeting of the country’s high level ‘Temporary Working Group for the prevention of COVID-19’, Díaz-Canel said that between 70 and 80% of Cubans now testing positive were linked to imported cases brought into the country by “travellers”, the expression being used to define Cubans living overseas as opposed to tourists. 

Referring to “growing concern in the population”, Cuba’s President spoke about “the violation of hygienic-sanitary measures and the non-respect of physical distancing and social isolation during the end of the year parties in which international travellers or their contacts participated”. Cuba, he said, now had to rapidly introduce “extreme measures”.

Cuba’s state media reported that at the 7 January meeting, the Prime Minister, Manuel Marrero, told provincial governors participating virtually that severe measures would be introduced and that many provinces and municipalities would be returned to earlier pandemic recovery stages. This, he said, would require them to rigorously contain the situation.

The new regressive classifications apply in different ways to seven of Cuba’s fifteen provinces and to many municipalities. These include Villa Clara and the Santa Clara municipality; Matanzas and the municipality of Matanzas; Mayabeque and the municipality of Güines; Artemisia; the municipality of Santiago de Cuba; Guantánamo and the municipality of Guantánamo. In the provinces of Las Tunas and Camagüey the working group meeting noted several municipalities would regress if the upward trend in infections was not reversed.

In the case of Havana, the province and all its municipalities will return to phase I of the recovery (it was in phase III). It was announced that, in addition, incremental measures will be implemented in the municipalities of Plaza de la Revolución, Centro Habana, Habana del Este, Habana Vieja, Cerro, La Lisa, Boyeros and 10 de Octubre, in such a way as to allow the rapid control of the epidemiological situation.

At a subsequent meeting of Havana’s Provincial Defence Council recognised the urgency of increasing the perception of danger among citizens by all possible means and agreed to analyse further measures ‘taking into account that in the city there is less lethality, but viral circulation has grown’.

Speaking on Cuban television, the National Director of Epidemiology at Cuba’s Ministry of Health, Dr Francisco Durán, indicated that that a gradual change in the epidemiological trend was beginning to be seen and the number of imported cases was now declining. 

He said that since the number of flights to Cuba had been cut from the US, Mexico, Panama, Haiti, the Dominican Republic and The Bahamas (See the Americas below and Cuba Briefing 4 January 2021) the number of ‘travellers’ entering Cuba daily averaged 1,400, compared to the more than 5,000 reached on peak dates in December.

He however predicted that the numbers of new cases would remain high for a while yet reflecting year-end festivities, but that Cuba would again bring the disease under control as it did in 2020. 

Durán reported that 3,479 people remained in Cuban hospitals of whom 746 were active cases, 946 suspected and 787 under epidemiological surveillance. By global per capita standards Cuba’s death and infection rates remain very low. The figure recorded at the end of December was the highest for any month since the start of the epidemic.

The meeting confirmed that schools would remain open and that all economic activity across the country that was functioning normally would continue. At an earlier meeting to discuss the pandemic, Vice Prime Minister Roberto Morales was reported to have confirmed that the national increase in infections was not associated with hotels in tourist centres or foreign tourists.

The Caribbean Council is able to provide further detail about all of the stories in Cuba Briefing. If you would like a more detailed insight into any of the content of today’s issue, please get in touch

In an indication of the political sensitivity of the economic, exchange rate and currency reforms being implemented, the Cuban government has reconsidered the sharp increase in electricity prices it had planned for 2021.

Before Christmas and following criticism on social media as well as objections by many Cubans, Vice President Marino Murillo, Head of the Permanent Commission for Implementation told members of the Cuban National Assembly meeting on 16 December: “Everything is being reviewed, all the opinions of the population …. including the electricity rate”.

Subsequently speaking on the television programme Mesa Redonda, he said that government had decided to rectify and reduce the electricity tariffs proposed initially.

The announcements followed widespread expressions of concern on social media and growing social discontent reflected in the state media. The objections led to the rare public policy reversal and the unusual announcement that in response to citizen concerns the rate would be lowered in a manner that would protect the ordinary Cuban. It was also announced that there would be a special rate that favoured private businesses, similar to that for state companies.

Speaking on Mesa Redonda, Murillo said “we have respectfully reviewed everything”, while referring to the importance of the guidelines provided by Raúl Castro as First Secretary of Cuba’s Communist Party, and President Díaz-Cannel about the need to listen to the opinions of the population. He also said that the price of pharmaceuticals and regulations in relation to non-state management, both of which are also contentious, would be discussed on future editions of the programme. “There are certain opinions that everything we have done has been to harm them (private business entities) and that they are not in good condition in this process”, he said.

Murillo however cautioned that addressing Cuba’s economic problems required evaluating how far one can go in making concessions. Much depended on what the economy can support, he said, considering the global crisis caused by the COVID-19 pandemic and the tightening of the US embargo. “None of that can be minimised”, he emphasised. He also observed that if it were not possible to maintain cost levels and noted that if “consumption skyrockets” the country could face a worst-case scenario of additional fiscal expense in the order of CUP5bn.

“Therefore, there is another principle, and it is necessary for the population to understand it, this could increase spending on the budget, and the Government’s decision is to face this with the same fiscal deficit approved in the National Assembly”, Murillo warned.

In early December, President Díaz-Canel had announced a range of economic measures to be introduced on 1 January related to prices subsidies and wages that will be introduced in parallel to the unification of Cuba’s dual currency system and setting an exchange rate of CUP1 to US$24 (Full details Cuba Briefing 14 December 2020).

Alongside the announcement of a minimum wage increase of 525% for state employees and a 450% hike in pensions, Government also announced and published details of significant increases in the price of goods, unregulated foodstuffs, pharmaceuticals, and services, including electricity.

The Caribbean Council is able to provide further detail about all of the stories in Cuba Briefing. If you would like a more detailed insight into any of the content of today’s issue, please get in touch

 Cuba’s Central Bank has granted a license to Servicios de Pago Red SA (REDSA) to enable it to facilitate the processing of remittances. 

Although the decision in relation to REDSA comes shortly after Western Union withdrew from Cuba as a consequence of US sanctions on FINCIMEX (Cuba Briefing 2 November 2020), Cuban officials have indicated that FINCIMEX continues to process remittances from send markets other than the US. 

The official media platform Cubadebate reported that REDESA’s licence has been modified to include among its activities the management and processing of family remittances from abroad to Cuba, with the intention of enabling the non-bank entity to develop a remittances operation in future. 

The online publication quoted the Central Bank as saying, “the measure approved for REDSA is a provision for the future, which does not take effect immediately; it enables this institution to manage and process family remittances from abroad to Cuba”. It also wrote that the measure was not related to the suspension of remittances through Western Union as “FINCIMEX continues to process remittances from other destinations.” 

Under the new regulation REDSA will be able to act as a processing centre for electronic paymentsin accordance Central Bank regulations; provide, manage and monitor electronic payment channels; administer, control, manage and further develop the country’s ATM network; and carry out interbank clearing processes for operations through Cuba’s Control and Monitoring Centre for Electronic Payments (CCMPE). 

The new regulation also allows REDESA to issue bank cards, process and send data for the reconciliation purposes involving RED and non-RED cards; and process and settle claims for operations undertaken through the CCMPE. 

Another resolution published in the same official gazette expands the remit of Financiera SA enabling it to process remittances received through REDSA. It makes clear that Compañía Financiera’s original licence has been cancelled and a new one granted to provide a range of services that includes the ability to undertake ‘any other operation and service of non-bank financial institutions’ in accordance with the law. 

On 27 November, Western Union closed its 400 offices in Cuba following the revocation of its license by the Trump administration on the basis that FINCIMEX, its Cuban operating partner was a subsidiary of CIMEX which is a subsidiary of GAESA, the powerful military-run Cuban business conglomerate. 

The effect has been to reduce the much-needed remittances from the US that provides the families and friends in Cuba with support that pays for food, rent, other expenses and supports many micro-businesses. There are early indications that once in office US President elect Joe Biden may sign an executive order reversing his predecessor’s remittances sanctions, perhaps explaining why, at this stage, the Central Bank is saying that the new REDESA service does not replace that provided by that of FINCIMEX. 

A recently published analysis by the US based Havana Consulting Group indicated that cash remittances to Cuba have so far this year fallen by about US$3.3bn in cash. The Group reportedly forecast that overall cash remittances by the end of this year are expected to decline by 36.8% to an estimated US$2.3bn. 

President Díaz-Canel has called on provincial Governors and officials to “battle” the steep rise in the price of foodstuffs and essential items now being seen across Cuba. 

“Abusive and speculative prices cannot be allowed, and we must go out to discuss with those who are currently raising prices, why they are doing it”, he was reported by Granma as having told participants during a videoconference. 

Noting that taxes have not risen, and the state continues to provide free health care and education, Díaz-Canel said that he could not understand the basis on which “a self-employed person or even a state entity now appears to be raising prices” 

According to the Communist Party publication, Cuba’s President said that the issue of high prices was one of the “main causes of disgust that, in recent weeks, the population has expressed,” especially in relation to agricultural products. 

It was a matter, Díaz-Canel said, that would require rigorous confrontation requiring action “with coherence and rigour” in ways that make Cubans a “part of the combat”. He also noted that the sanctions on transgressors needed to be “severe and exemplary” and that the issues be exposed in the media “so that the population knows what they are and can act against any violation”. 

In a related but broader intervention, Vice Prime Minister, Alejandro Gil, the Minister of Economy and Planning, said that three fundamental challenges now faced Cuba: food production, the development of exports, and the unification of the country’s monetary and exchange rate system. 

Speaking at an event to recognise the role of economists, he said that the country’s economic and social strategy, ‘requires freeing productive forces, granting more autonomy to the state sector, and creating similar management systems regardless of the type of ownership’. 

In remarks reported on the Cubadebate platform, he stressed the importance of a new focus on food production and food supply which he acknowledged was experiencing ‘unjustified and speculative inflation’. 

Gil stressed the importance of adding value to exports in order “to create wealth”. To achieve the ‘proceso de reordenamiento’ – the reordering task – the expression being used for the linked economic reforms now underway. It was, he pointed out, essential to end the country’s dual currency system and to make adjustments to the exchange rate, incomes, state subsidies and ‘undeserved income’ if employment is to be created and Cubans are to have a decent life. For these reasons, he said, the application of the measures approved required “acceleration, innovation and dynamism” and a willingness “to face risks” without improvising. 

In a similar vein, Vice President, Salvador Valdés Mesa, speaking in Guantánamo was quoted as telling a meeting on food sovereignty and nutrition that it was “essential for the country to produce more food in the shortest time possible, and take better advantage of the existing potential in all territories”. 

The issue of rapidly rising food prices has become highly sensitive in Cuba as its more liberal internet environment has enabled the posting of many comments online on official platforms and social media. For the most part these are highly critical and questioning about why state enterprises as well as non-state producers and farmers are being allowed to raise the price of goods from tomatoes to confectionery and shampoo. 

Recently, the official publication Cubadebate questioned why prices were rising so steeply when the country’s planned reforms to its currency had not yet taken place. An op-ed piece asked how ordinary Cubans existing on state salaries were meant to cope when prices are already surging for food and services. Price increases the author argued were only meant to occur when the process of monetary unification and exchange rate regulation was in place (Cuba Briefing 17 November 2020). 

The Caribbean Council is able to provide further detail about all of the stories in Cuba Briefing. If you would like a more detailed insight into any of the content of today’s issue, please get in touch