North Dakota officials see opportunity in Cuba behind looming political barriers.
Agriculture Commissioner Doug Goehring led 14 delegates on a trade mission to Cuba in October, but North Dakota companies interested in doing business in the country face issues of credit and economic embargo.
On Dec. 17, 2014, President Barack Obama and Cuban President Raul Castro announced the beginning of normalizing relations since the U.S. severed diplomatic relations during the Cold War. North Dakota agricultural representatives visited with the aim of furthering inroads into the country.
“The goal is not to displace food in their food system, but to incorporate our products to enhance it with quality and nutritional value,” said Goehring, adding that he sees potential for marketing black beans, pinto beans, chickpeas, as well as wheat and flour, to the country.
“They’re a big consumer of cereal grains,” he said, pointing out there may also be potential for malt barley.
But credit and an economic embargo still maintained by the U.S. are considered a hindrance by the Cuban government.
Eric Hardmeyer, a trade mission delegate and president of the Bank of North Dakota, said the bank would like to play a role in helping provide credit where possible, though there are no programs available at present. He said BND could get involved through the U.S. Export Import bank should Congress choose to reinstate it.
Cuba produces 40 percent of its caloric needs, Goehring said, but because of tourism, it imports 80 percent of its food.
“We believe there’s a lot of opportunity,” said Goehring of the many newly established hotels and restaurants in the country.
Delegates met with restaurant owners who were not in business two or three years ago. They also toured a newly formed farmers market, the first of its kind in 40 years.
“It was rudimentary, but it was the beginning of a free market,” Hardmeyer said.
The last time Goehring was in Cuba was 2010 to discuss phytosanitary rules. This time around, he saw buses and taxis.
“You’ve never seen that there; they’re evolving. They’re actually doing very well considering,” said Goehring, pointing to land redistribution as more evidence of decentralization and a free market.
“They are giving the land back to the peasants,” he said of a process to give 30 to 35 acres for private farming and 85 to 100 acres for cooperative farming. When complete, 75 percent of developed farm land will be privately held.
Three new hotels in Havana developed in partnership with European countries stand as evidence of other countries’ interest in the island nation. Goehring said Asian and European countries are already offering the credit sought by the Cubans.
While there, delegates also met with the minister of foreign affairs and the export/import arm of the country. Goehring said officials asked about BND and the North Dakota Mill and Elevator. He said he sees potential in an exchange of ideas as well as goods, particularly when it comes to research and introducing North Dakota products to increase shelf life.
Hardmeyer said he has offered to provide information about successful entrepreneurial programs at BND to the country as fledgling businesses take off within its borders.
Goehring said the next step is getting approval for a reverse trade mission, bringing Cuban delegates to North Dakota, and maintaining contact with the country’s officials as Washington, D.C., works out the political kinks.