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Business News/ News / World/  What the US’ new ‘Cuba Libre’ policy means
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What the US’ new ‘Cuba Libre’ policy means

Wednesday's agreement gives the US a diplomatic opening of sorts, given that its ties with Cuba, 90 km off Florida's coast, have been virtually non-existent since the 1960s

The US imposed a commercial, financial and economic embargo on Cuba in 1958 in response to the armed Cuban Revolution led by Fidel Castro. Photo: AFPPremium
The US imposed a commercial, financial and economic embargo on Cuba in 1958
in response to the armed Cuban Revolution led by Fidel Castro. Photo: AFP

New Delhi: It won’t be long before Americans or those visiting the US can sample some of the most exquisite Cuban cigars—the Partagas or the Cohibas, or its former President John F. Kennedy’s favourite, H.Upmann. Or for that matter, the globally famous Cuba Libre rum and coke cocktail, whose main ingredient is the Havana Club rum.

In one of the more interesting foreign policy coups in recent times, the US and Cuba on Wednesday announced a historic agreement towards normalizing relations between the two countries, ending over 50 years of hostility.

Wednesday’s agreement gives the US a diplomatic opening of sorts, given that its ties with Cuba, which lies 90 km off its Florida coast, have been virtually non-existent since the 1960s. The US imposed a commercial, financial and economic embargo on Cuba in 1958, which remains in place.

The embargo was in response to the armed Cuban Revolution led by Fidel Castro, which deposed the government of President Fulgencio Batista in 1959. Interestingly, India was one of the first nations to recognize the new socialist government.

In another historic first, US President Barack Obama and his Cuban counterpart Raul Castro spoke with each other on Tuesday, in a phone call that lasted about an hour, according to a CNN report. This was the first presidential-level communication between the two countries since the revolution.

The agreement means that both countries, primarily the US, will take steps towards renewing and restoring diplomatic ties with Cuba. Relations between the two countries have been severed since October 1960, when the US recalled its ambassador Philip W. Bonsal in Havana to protest against the Castro regime and its policies. The US withdrew diplomatic recognition of the Castro government in January 1961.

The two countries will now initiate talks to reopen a US embassy in Havana in the coming weeks.

“In the coming months, we will re-establish an embassy in Havana and carry out high-level exchanges and visits between our two governments as part of the normalization process," a White House summary said. The new policy also said that Cuba’s status as “a state sponsor of terrorism" (since 1982) will be under review.

The other key takeaway from Wednesday’s agreement is that prisoners from both sides would be released. Three Cubans—Gerardo Hernandez, Luis Medina and Antonio Guerrero—have been imprisoned in the US after they were convicted of alleged espionage. Likewise, an American contractor Alan Gross, imprisoned in Cuba since the last five years on charges of “Acts against the Independence and Territorial Integrity of the State" has been released by the Cubans. Gross was sentenced to 15 years in prison in 2011.

Cuba, for its part, is also expected to release 53 political prisoners it has imprisoned from a list provided by the US.

Though the Cuban economy is largely socialist in nature with the state controlling the means of production, it approved a law earlier this year allowing foreign investment. Its economy has largely been dependent on Venezuela, another socialist economy largely built on oil. It is likely that tumbling oil prices and Venezuela’s shaky economy forced Cuba to look elsewhere. Historically, Cuba and Venezuela have enjoyed close relations. Its late leader Hugo Chavez considered Fidel Castro as his mentor and supported a bloc of Latin American countries, who were opposed to what they called US imperialism.

The agreement between the US and Cuba, in many ways, couldn’t have come at a better time. The US is expected to ease licences for its citizens interested in doing business in Cuba and travel to the country for the same. While tourism, as per the new rules, won’t be initially permitted, it is expected to ease norms for American citizens to visit the country for other purposes. Americans will also be allowed to use credit and debit cards in Cuba, another move that is expected to improve the local economy and tourism.

Americans permitted to travel to Cuba will be allowed to import $400 worth of goods, of which up to $100 can consist of tobacco products and alcohol combined.

Cuba has among the lowest Internet penetration rates in the world—5% as per a White House summary. Cuba, on its part, is expected to allow its citizens increased access to telecommunications and the Internet.

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Published: 18 Dec 2014, 03:45 PM IST
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