Dec. 18 (Bloomberg) -- President Obama announced on December 17 that the
United States will resume diplomatic relations with Cuba after more
than 50 years of antagonism. Bloomberg's Sam Grobart recaps the standoff
between the two nations, and explains why the icy relationship has
begun to thaw.
“The business community here is starving for opportunities to be explored down in Cuba,” said Milton Vescovacci, a Miami-based partner at the firm and head of its Cuba business unit. “You can hear in my voice the kind of energy that I have about this subject. That’s the same energy we’re seeing from clients.”
Real-estate developers, sugar growers, medical-device manufacturers and telecommunications firms each see opportunity in friendlier relations between the U.S. an
d Cuba, which are separated by just 90 miles (145 kilometers).
In Florida, an $800 billion economy that is home to two-thirds of the nation’s 2 million Cuban-Americans, Obama’s measures could have the strongest economic impact, said Vescovacci. Some business leaders in Miami’s exile community, home to the fiercest opposition to Cuba’s communist government, see in the island nation an opening to expand their operations.
“If eventually trade relations are completely normalized, then Florida, by its proximity, stands to gain more than any state,” said Sean Snaith, who teaches economics at the University of Central Florida in Orlando.
People stand outside the Little Havana restaurant Versailles after news that U.S.... Read More
“The embargo has not worked,” said Greer, who traveled to Havana two years ago on a personal trip. “It’s been 55 years and what has happened? The regime has gotten stronger and the embargo hasn’t changed anything.”
Prisoner Swap
Horacio Yaikime Reyes-Lovio, a Cuban immigrant who opened the La Fontana Miami restaurant in Miami Beach last month, said the mood was upbeat at lunch as customers watched the president’s speech.In exchange for a prisoner swap, Obama outlined measures he planned to take, including easing travel restrictions, allowing more trade, authorizing the use of U.S. credit cards in Cuba and opening an embassy in Havana.
“It’s the best,” Reyes-Lovio said.
Reyes-Lovio operated a private restaurant in Havana by the same name for two decades before moving to Miami, where he faced fewer restrictions in setting up a small business. Obama singled out Miami as an example of how better relations with Cuba could improve the island’s economy.
‘Disappointed and Frustrated’
“Countless thousands of Cubans have come to Miami -- on planes and makeshift rafts -- some with little but the shirt on their back and hope in their hearts,” Obama said in Washington.Some Cuban exiles and Republican lawmakers decried Obama’s actions, saying they would only embolden Cuban President Raul Castro to continue human rights abuses.
“I was so disappointed and frustrated when I heard the news,” said Gus Machado, an 80-year-old Cuban-American who came to the U.S. in 1949 and owns two car dealerships in south Florida. “Now they have decided to be friends and forget the past, but that’s not what thousands of people died for after working all their lives to have democracy in Cuba.”
Florida Republican Senator Marco Rubio, the son of Cuban exiles, vowed to block Obama’s actions.
Embassy Funding
“We’re going to have a very interesting couple of years discussing how you’re going to get an ambassador nominated and how you’re going to get an embassy funded,” said Rubio, who is slated to become chairman of a panel that oversees foreign relations in the Western Hemisphere.Florida’s Republican Lieutenant Governor, Carlos Lopez-Cantera, said Obama’s actions legitimize the “brutal dictatorship” of the Castro regime and “make it harder for the people of Cuba who are fighting for democracy.”
Without support from Congress, Obama’s actions will have limited impact, said Joe Arriola, a Miami businessman who serves on the board of Perry Ellis International Inc. (PERY)
“This is not going to allow me to open a business in Havana tomorrow or open a bank in six months,” he said. “Until the United States Congress amends the embargo, very little active business can occur.”
Sebastiaan Berger, who invests in Cuba through Ceiba Investments Ltd, based in Guernsey, Channel Islands, said that while Obama’s actions will increase tourism, a broader impact won’t be felt until the embargo is lifted.
Political Pressures
“The real things that Florida companies are looking for are still not allowed,” he said, using Miami-based Carnival Corp. (CCL) as an example. “Carnival will only be allowed to land a ship in Cuba when there is something more happening than the easing of tourism restrictions.”Political pressure from Florida’s Cuban community could make that difficult, he said. In Florida, the nation’s largest presidential swing state, politicians viewed as soft on Cuba have faced a backlash from a politically active exile community.
Greer said that backlash has mostly come from an older generation, one that is slowly being replaced by U.S.-born descendants of Cuban exiles who travel to the island more frequently and are open to ending the embargo.
“My generation would be split 50-50 on it, but everybody younger than me is in favor of getting rid of the embargo,” he said. “For the generation that left Cuba in the early 1960s, Cuba to us is the stories that our fathers and uncles told us and photos in black and white.”
Business leaders in South Florida are positioning themselves for an end to the embargo, said Vescovacci. His law firm led a seminar in Orlando last month for business leaders interested in Cuba. It’s planning another one for 2015.
“Maybe next year we’ll have it in Havana,” he said.
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