US-Cuba Pact Excites Texas Businesses, But Problems Loom

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The Dallas Morning News ran a very informative piece about the Texas business implications of the lifted Cuban embargo. While to be fully realized Congress will have to lift the export embargo (more on that below), diverse industries across the state are angling to jump on what would be a significant opportunity in the nation of 11 million people.

Florida, Texas’ competitor for the market, finds itself at a disadvantage due to the virulently anti-Castro Cuban political faction. Businesses there face more hurdles before taking advantage of newly open trade between the United States and Cuba. Texas is poised to benefit greatly.

Alfredo Corchado explains:

Over the years, Texas leaders have touted possible deals for beans, cotton, rice, grain, packaged desserts, organic soaps, livestock, even airlines and ports. Success has come slowly, with overall sales of Texas agriculture products topping $89 million in 2009 before falling. Some agricultural products are exempt from the embargo.

There is an interesting kinship between Texas and Cuba that many people these days may not know. When Fidel Castro made his sole trip to the United States, he came to Houston and donned a cowboy hat. In Cuba, visiting Texans are known as “John Waynes”. Cuba’s “homeland town” Camaguey is a huge Tex-Mex music center, and a favorite of Fidel Castro’s. Corchado notes: “Both [countries]have had revolutions. Both have a passion for gritty cowboys, fine cattle and baseball. And both have unwavering pride in their independent spirit, underscored by their flags, each emblazoned with a single star.”

Texas business excitement aside, however, the problem of Cuban poverty looms. The vast majority of the population is poor, and it may take years — even a decade — for the Cuban market to take shape. A core component, however, will be stateside. A tourism boom will help Texas airports serve as hubs for travelers to Cuba. If the economic embargo is lifted fully, Houston will likely become the main American port for shipping agricultural goods to Cuba.

But that’s a big “if”. The other problem besides Cuban poverty is a frequent thorn in the side of progress: Congress. For full economic relations, it would need to repeal the Helms-Burton Act of 1996 barring most exports to Cuba. That appears unlikely in the next two years; Speaker John Boehner said that “[r]elations with the Castro regime should not be revisited,” period, and the loudest Republican voices — Marco Rubio and Ted Cruz among them — say the same. And with the gerrymandered-Republican House, it may take preposterously long.

Nonetheless, if you follow economics, adjustment to the Cuban market will be a big theme in coming years. UPenn’s Wharton school will host a “major conference for senior U.S. executives to gain insight into the legal and business challenges of doing business in Cuba as well as to formulate a strategic roadmap for entry into the market” this April in New York City. Vox offers you answers to “9 questions about Cuba you were too afraid to ask”. Cuba’s economy is improving, but very slowly and many metrics are unavailable. That’s due both to Castro administration restrictions as well the American export embargo. Don’t expect Congress to do its part to help both countries soon, but the question will almost certainly stay on the table long enough to get answered the right way eventually.

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About Author

Ben Sherman

Ben Sherman has been a BOR staff writer since 2011. A graduate of the University of Texas, Ben has worked on campaigns, in political consulting, and has written for other news outlets like Think Progress. Ben considers campaign finance reform the fundamental challenge of our time because it distorts almost every other issue in American politics.

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