Friday, July 23, 2010

Are we preparing for the Cuban economic hurricane?

jamaicaobserver editorial:

The United States policy of an embargo against Cuba has been a comprehensive failure. Castro's administration has survived.

The redundant embargo should have been abolished long ago. Had it not been for hubris and an outdated determination to impose its will as a global superpower, the US would have stopped jousting with this imaginary enemy. Just how much of an anachronism the embargo is has been clearly demonstrated by the fact that the US has diplomatic relations and trade with Vietnam, a country with which it fought a full-scale war. The Organisation of American States has removed the ban on Cuba's membership clearing the way for Cuba to rejoin the organisation.

The outstanding internationalism has been blemished by flawed human rights and the absence of pluralist democracy. Critics in the Western world, in particular the US, have used the shortcomings of Cuban democracy as the justification for an economic blockade and a campaign of political isolation. Admirers of Cuban self-reliance and resistance to US hegemony have been willing to turn a blind eye to the palpable restraints on individual freedom.

The appointment of Raul Castro to the presidency of Cuba after an apprenticeship of almost half-a-century has brought important changes. He has moved to liberalise access to consumer goods the rest of the world takes for granted, such as cellular phones. Some private farming and more foreign travel have been permitted.

Learning the lesson of the implosion of the Soviet Union and the amazing economic development of China, the Cuban Government is moving towards "Market Leninism". The objective is to improve the standard of living by diversifying beyond sugar and tourism. This will require international trade and foreign investment and increased participation in the capitalist world economy.

The remaining impediment was the continued imprisonment of political opponents. That is now out of the way. It is an opportunity for the US to switch its foreign policy towards Cuba from isolation to engagement.

Exporters and potential investors in the US are salivating at the prospect of re-entry to the Cuban economy. There is already a flourishing trade in US food to Cuba. The business interests are pressing the Congress and a willing but coy Obama administration to normalise relations as it has done with former enemies Germany, Japan, China, Vietnam, and North Korea.

A change in US policy is imminent and Cuba's release of political prisoners is the "olive branch". It is now only a matter of time.

When it happens it will have the most profound effect on Jamaica and the Caribbean. The most worrying is the impact of competition from Cuba for foreign investment, export markets, development aid and tourism.

Cuba has the advantage of being the largest market in the Caribbean, a new tourism destination to US travellers, an undersupplied market and a literate, disciplined and inexpensive labour force.

Jamaica will have to compete and we can do so successfully if we make the necessary preparations.

In the same way that the Government has an emergency plan to cope with hurricanes, then it should immediately prepare a plan to cope with the intense economic competition which the return of Cuba to the global economy will cause.

The warning signs for this Category 5 economic hurricane are plain to see. There is no reason to be caught off guard.

jamaicaobserver editorial