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Competing with Cuba

Friday, May 29, 2015


The region will need to adjust to competition from Cuba, in areas that include tourism, agricultural production and medical services. The process will be slow.

But Cuban relations with the United States are thawing: In terms of competition, tourism will be a major factor.

During the North American winter, Cuban weather is not as attractive as that of Central America. On the other hand, Cuba is warmer than Florida, and almost as close.

Cuba last year earned $3 billion from tourism, the island’s biggest industry.

Some Cuban agricultural exports, including sugar, would have problems competing in the United States and European Union, which impose import duties and quotas.

Central America has free trade deals with both major markets.

On the other hand, many Cuban agro products face few or no barriers, while benefitting from low-cost shipping.
Havana is 370 kilometers from Miami.

Another potential growth area involves medical services for foreigners.

Growth in Cuban-American business will take time. The United States Congress is unlikely in the near term to allow normalized trade.

But other signs are positive.

United States President Barack Obama and his Cuban counterpart Raul Castro met at last month’s Panama summit, while French President Francois Hollande came to Havana with a delegation that included potential tourism and oil-gas investors. Japan, the Netherlands and the United Kingdom also sent delegations.

Since the start of this year, Americans in various fields, including science, education and entertainment, can visit Cuba, as result of an agreement between both governments, which in addition plan to restore diplomatic relations, severed since 1961.