UK says it will oppose any tightening of US trade embargo

Two British Government Ministers have separately criticised the US trade embargo on Cuba and made clear that the UK will oppose any possible tightening of it in the coming months (Cuba Briefing, 21 January 2019).

Both Ministers indicated that Britain will work with other European Union nations to provide UK companies with the support they need to be able to trade with Cuba. This is believed to be a reference to the consideration that some EU member states have given to extending the three-country trade facilitation scheme that has recently been put in place for Iran, to Cuba.

In the case of Iran, following the unilateral re-imposition of US sanctions by the Trump Administration, the UK, France and Germany, set up a special trade channel, INSTEX, to keep some lines of trade with EU companies open by processing trade payments not subject to US sanctions. The measure avoids direct confrontation with the US.

Answering a government-friendly oral question on Cuba in Parliament on 22 January from MP David Davies, the Foreign and Commonwealth Office Minister for Europe and the Americas Sir Alan Duncan, replied: “As we have said on many occasions, we consider the US embargo to be counterproductive, and we oppose any possible tightening of it in the future. US sanctions and other unilateral administrative and judicial measures do the opposite of encouraging potential reforms and economic progress ….”.

Davies, a senior Conservative backbencher and former Cabinet Minister, then went on to urge the Government to do everything possible to remind the United States of its commitment to free trade around the world and its importance in encouraging freedom and democracy. In reply, the Minister noted that the UK consistently voted in support of UN resolutions to end the US-imposed embargo. He also noted that the UK Protection of Trading Interests Act 1980, made it “illegal for UK companies to comply with extraterritorial legislation such as the US embargo.

The UK would also, he said “continue to work together with our EU partners to provide UK companies with the support they need to be able to trade with Cuba”.

In a separate more specific written question on 29 January, the Labour Shadow Minister, Karen Lee, asked what plans Government had to support British companies that trade with Cuba if the US lifted the suspension of Title III of the Helms-Burton legislation. The Minister of State (International Trade), George Hollingbery, replied that the UK Government opposed any possible tightening in the future “on the grounds of its damaging impact on the Cuban economy, its counterproductive effect in achieving positive change in Cuba, and the negative extra-territorial effects that it has on UK business”.

He went on to note that the EU and UK had already passed legislation – the EU Regulation 2271/96 (“The EU Blocking Regulation”) and the Extraterritorial US Legislation (Sanctions against Cuba, Iran and Libya) (Protection of Trading Interests) Order 1996 – that made it illegal to comply with the extraterritorial effects of the embargo.

He noted too that Britain would “continue to work together with our EU partners to provide UK companies with the support they need to be able to trade with Cuba”.

According to a recent French Government statement, in the case of Iran INSTEX will initially support trade in sectors essential to the Iranian population including pharmaceutical, medical devices and agri-foods. It said that in the longer term it will be extended to economic operators from third countries.

These developments come as the US appears to be moving towards substantially toughening its trade embargo on Cuba. (See story below under United States).

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