Cubans will benefit from normalized ties with the U. S.
Tourism will foster economic boom, Denis Rey writes.
U. S. President Barack Obama recently took important steps toward normalizing relations with Cuba. Even though it will take an act of Congress to lift the 50- year- old embargo, the president retains the ability — through executive action — to foster greater economic activity between the two countries. Will such an opening help the Cuban people? My belief is that Cubans will benefit greatly. To begin, unilateral sanctions tend to hurt the target country’s citizens more so than bring about political change. Research has shown that political elites are often able to insulate themselves from whatever economic hardships sanctions bring about. Cuba exemplifies this phenomenon.
Fifty years of isolation has had a devastating effect on Cubans. The human condition becomes evident as soon as one drives through small towns, rural villages, and larger cities alike; mostly observing infrastructure that is falling apart, transportation that appears vastly inefficient, and food scarcity that is pervasive. The difficulties are plenty and efforts to resolve them usually involve employing the informal market, where goods can be had if paid with convertible currency instead of moneda nacional, or Cuban pesos. After digging a little deeper, one learns that the black market is fuelled by the pilfering of state- owned enterprises and through remittances and products ( for resale) sent from the United States. Even the regime understands the significance of this informal market, choosing to turn a blind eye rather than orchestrating a crackdown, because, if not for the black market, survival would prove much more challenging.
How will Obama’s actions benefit Cubans? Allowing increased remittances will have an immediate impact. The executive action will now permit relatives to send up to $ 2,000 per
Changes in the rules governing banking also will have a positive impact on the lives of Cubans.
quarter. For many, these additional funds will help meet their day- to- day needs; however, for many others, it represents startup capital for private business ventures, which recent government reforms have allowed, albeit with a high tax burden. When I return to Cuba this May I will likely observe many more privately run restaurants, barber shops, and other small enterprises. Changes in the rules governing banking also will have a positive impact on the lives of Cubans. Cubans have always been resourceful when it comes to the transfer of goods and capital from the U. S. The practice of human mules is sure to continue. Nevertheless, transferring money to Cuba has just been made easier. One can now open an account, provide the Cuban recipient of remittances a debit card, and fund the account from the U. S. Finally, and in all honesty, the greatest impact that Obama’s new rules will have on the Cuban people consists of simply allowing more Americans to visit and spend freely without needing to obtain a special licence. A strong dose of U. S. consumerism on the island will be paramount to prosperity, the influx of U. S. dollars increasing demand for goods and services.
In essence, the combination of greater remittances, U. S. banking, and increased tourism will foster an economic boom on the island that has not been seen since the 1950s. Such economic activity has the potential of lifting thousands out of poverty and starting them on the road to prosperity. Granted, this will take time, as many hurdles will need to be cleared; but the possibility is real. I, as proponent of change, remain very optimistic.