On July 8 of 1963, 54 years ago, the Cuban Assets Control Regulations were approved, an essential component of the U.S. blockade of Cuba
Over the last 54 years, through Democratic and Republican administrations alike, the economic, commercial, and financial blockade of Cuba has occupied a spot on the agenda of the U.S. President of the moment.
Even though it is common to think of the blockade as a single law, it is actually composed of a number of different pieces of legislation that regulate sanctions against Cuba.
In this sense, the U.S. Treasury Department’s Cuban Assets Control Regulations are the most notable body of economic, commercial, and financial measures that sustain the blockade.
REGULATIONS TO CONTROL CUBAN ASSETS
These regulations stipulate the legal regime applicable to all commercial and financial transactions with Cuba, conducted by any U.S. citizen, permanent resident, or incorporated body established in the country.
They likewise allow for the freezing of Cuban assets in the United States, as well as the prohibition of Cuban exports to the country, and all financial and commercial transactions in U.S. dollars by the Cuban government – unless approved under a specific license.
Also prohibited are transactions in U.S. dollars by any person or corporation in a third country with Cuban individuals or entities.
Since its imposition more than 50 years ago, the blockade has caused the Cuban people damage estimated at a value of 753,688,000,000 dollars, impacting health, education, sports, culture, and other strategic sectors key to the country’s development.
THE BLOCKADE SINCE 12/17/2014
On December 17, 2014, then President Barack Obama publicly acknowledged that his country’s longstanding policy toward Cuba had failed. He subsequently implemented a series of executive decisions to modify certain aspects of the blockade, among them the Cuban Assets Control regulations.
In terms of travel, he authorized visits by U.S. citizens to Cuba under licenses in 12 accepted categories, including individual people-to-people travel, and allowed regular flights between the two countries to be established, although travel to the island for the purpose of tourism remained prohibited by law.
In the financial arena, use of the dollar was authorized for Cuba in international transactions, although not a single transaction has yet taken place and financial persecution continues. U.S. banks were also allowed to provide credit to Cuban importers wishing to purchase authorized U.S. products.
Nonetheless, fear of facing sanctions on the part of financial institutions has made the impact of these changes practically null. Moreover, prohibitions have been maintained which prevent Cuban banks from opening corresponding accounts in the United States, which impedes the establishment of direct banking relations between the countries, making commercial operations more expensive.
Changes regarding commercial relations were limited to the tele-communications industry and the private sector in Cuba (the self-employed and cooperatives), consistent with the “soft power” approach of the Obama administration to promote subversion of the Cuban people and replace socialism.
Generally speaking, the measures adopted confirmed that the U.S. President could use his executive powers to substantially modify the implementation of the blockade, without involving Congress.
Nevertheless, the changes were insufficient and limited in scope, while the many important restrictions and obstacles which remained in place hampered implementation, effectively blocking progress in the economic arena.
WHAT NOW WITH TRUMP’S ELECTION?
The election of Donald Trump as U.S. President has generated controversy and uncertainty worldwide.
The country’s policy toward Cuba has not escaped this reality. This past June 16, Trump announced a change in policy for his administration, to be implemented over the next few months.
This preparatory period continues, but it can be expected that the new measures will contrast sharply with those previously approved by Obama. Implementation of the Cuban Assets Control Regulations may be notably reinforced, along with the Treasury Department restrictions.
In this context, changes could mean a step backward in the process of normalizing relations between Cuba and the United States, limiting travel by U.S. citizens to the island, as well as commercial and financial relations between companies in the two countries.
Ana Luisa Fernández de Lara López, Cristian Andrés Padilla González, Maibel Costa Ramírez, Natalys Dinza Utria*, Granma
July 12, 2017
*Students at the Raúl Roa García Advanced Institute of International Relations