Introduction

Cuba has been at odds with the United States since Fidel Castro assumed power in 1959. Successive U.S. administrations have employed tough measures against the country, including prolonged economic sanctions and designation of Cuba as a State Sponsor of Terrorism, but none have substantially weakened Castro's rule. In February 2008, longtime president Fidel Castro formally resigned from office, sixteen months after transferring many powers to his brother Raúl due to illness. Despite stirrings of U.S. economic interest in Cuba and some policy softening under President Barack Obama, experts say that normalization of bilateral relations is unlikely in the near to medium term. Tensions between the two countries peaked with the 2009 arrest of U.S. citizen Alan Gross, who was tried and convicted of attempting to destabilize the Cuban regime through a U.S.-sponsored program. Recently, Raúl Castro has implemented major reforms, including the lifting of fifty-year-old travel restrictions for Cuban citizens, which, analysts say, are helping the country strengthen ties with its Latin American neighbors.

Share

--

--

What is the status of U.S.-Cuba relations?

They are virtually nonexistent. There is a U.S. mission in Havana, Cuba's capital, but it has minimal communication with the Cuban government. Since 1961, the official U.S. policy toward Cuba has been two-pronged: economic embargo and diplomatic isolation. The George W. Bush administration strongly enforced the embargo and increased travel restrictions. Americans with immediate family in Cuba could visit once every three years for a maximum of two weeks, while family remittances to Cuba were reduced from $3,000 to just $300 in 2004. However, in April 2009, President Obama eased some of these policies. He went further in 2011 to undo many of the restrictions imposed by the Bush administration, thus allowing U.S. citizens to send remittances to non-family members in Cuba and to travel to Cuba for educational or religious purposes.

Congress amended the trade embargo in 2000 to allow agricultural exports from the United States to Cuba. In 2008, U.S. companies exported roughly $710 million worth of food and agricultural products to the island nation, according to the U.S.-Cuba Trade and Economic Council. However, that number fell by about 50 percent in 2012. Total agricultural exports since 2001 reached $3.5 billion as of February 2012. Nebraska, Oklahoma, and Texas have all brokered agricultural deals with Cuba in recent years.

Tension between Cuba and the United States flared in December 2009 with Cuba's arrest of Alan Gross, a USAID subcontractor who traveled to the country to deliver communications equipment and arrange Internet access for its Jewish community. Cuban authorities alleged Gross was attempting to destabilize the Cuban regime through a USAID-sponsored "democracy promotion" program, and he was subsequently sentenced to fifteen years in prison.

Despite initial optimism over Obama's election, Cuban politicians and citizens are less hopeful of a positive relationship developing between the two countries. Raúl and Fidel Castro have both criticized the Obama administration. In a 2009 speech, Raúl Castro accused the United States of "giving new breath to open and undercover subversion against Cuba."

What is U.S. public opinion on the isolation of Cuba?

Some U.S. constituencies would like to resume relations. U.S. agricultural groups already deal with Cuba, and other economic sectors want access to the Cuban market. Many Cuban-Americans were angered by the Bush administration's strict limits on travel and remittances, though a small but vocal contingent of hard-line Cuban exiles, many of them based in Florida, does not want to normalize relations until the Communist regime is gone. "When they're polled, the majority of Cuban-Americans say that the embargo has failed, and support lifting the travel ban or loosening the embargo or some steps along that continuum of liberalization and normalization," says Julia E. Sweig, CFR director of Latin American studies.

Ending the economic embargo against Cuba would require congressional approval. Opinions in Congress are mixed: A group of influential Republican lawmakers from Florida, including former representative Lincoln Diaz-Balart, his brother Mario Diaz-Balart, and Ileana Ros-Lehtinen are stridently anti-Castro. Still, many favor improving relations with Cuba. In 2009, Sen. Richard Lugar (R-IN), the top-ranking Republican on the Senate Foreign Relations Committee, released a report calling for U.S. policy changes. He said: "We must recognize the ineffectiveness of our current policy and deal with the Cuban regime in a way that enhances U.S. interests" (PDF).

What is the likelihood that the United States and Cuba will resume diplomatic relations?

Given the range of issues dividing the two countries, experts say a long process would precede resumption of diplomatic relations. Daniel P. Erikson of the Inter-American Dialogue says that though "you could have the resumption of bilateral talks on issues related to counternarcotics or immigration, or a period of détente, you are probably not going to see the full restoration of diplomatic relations" in the near term.

Many recent policy reports have recommended that the United States take some unilateral steps to roll back sanctions on Cuba. The removal of sanctions, however, would be just one step in the process of normalizing relations. Such a process is sure to be controversial, as indicated by the heated congressional debate spurred in March 2009 by attempts to ease travel and trade restrictions in a large appropriations bill. "Whatever we call it--normalization, détente, rapproachement--it is clear that the policy process risks falling victim to the politics of the issue," says Sweig.

What is the main obstacle in U.S.-Cuban relations?

A fundamental incompatibility of political views stands in the way of improving U.S.-Cuban relations, experts say. While experts say the United States wants regime change, "the most important objective of the Cuban government is to remain in power at all costs," says Felix Martin, an assistant professor at Florida International University's Cuban Research Institute. Fidel Castro has been an inspiration for Latin American leftists such as Venezuelan President Hugo Chávez and Bolivian President Evo Morales, who have challenged U.S. policy in the region.

What are the issues preventing normalization of U.S.-Cuba relations?

Experts say these issues include:

• Human rights violations. In March 2003, the Cuban government arrested seventy-five dissidents and journalists, sentencing them to prison terms of up to twenty-eight years on charges of conspiring with the United States to overthrow the state. The Cuban Commission for Human Rights and National Reconciliation, a Havana-based nongovernmental group, reports that the government has in recent years resorted to other tactics besides prison --such as firings from state jobs and intimidation on the street-- to silence opposition figures. A 2005 UN Human Rights Commission vote condemned Cuba's human rights record, but the country was elected to the new UN Human Rights Council in 2006.
• Guantanamo Bay. Cuba indicated after 9/11 that it would not object if the United States brought prisoners to Guantanamo Bay. However, experts such as Sweig say Cuban officials have since seized on the U.S. prison camp--where hundreds of terror suspects have been detained--as a "symbol of solidarity" with the rest of the world against the United States. Although Obama ordered Guantanamo to be closed by January 22, 2010, the facility remains open as of January 2013, and many analysts say it is likely to stay in operation for an extended period.
• Cuban exile community. The Cuban-American community in southern Florida traditionally has heavily influenced U.S. policy with Cuba. Both political parties fear alienating a strong voting bloc in an important swing state in presidential elections.

However, CFR's Sweig says that Raúl Castro's tenure as president and the reforms he has brought to the country have indicated a willingness to normalize relations with the United States again. "It's not realistic to expect the United States to undertake a series of unilateral moves toward normalization; it needs a willing partner," she told CFR.org in a 2012 interview. "I believe we have one in Havana but have failed to read the signals."

What kind of changes has Raúl Castro implemented in Cuba?

Raúl Castro has implemented a number of significant changes to the structure of the Cuban government and economy. Several changes related to agriculture, including a decision in 2008 to give individuals land for farming, were meant to spur food production on the island. He liberalized the real estate and auto markets, created space for small businesses, and cracked down on corruption. "Raúl Castro, though no democrat, is clearly a more practical man than his brother," said a 2010 Economist article. "He recognizes that time is running out for his island. The population is shrinking and ageing, the economy is hopelessly unproductive and the state can no longer pay for the paternalist social services of which Cuba was once proud."

However, Raúl Castro's steps toward capitalism have been "both remarkable and extremely limited," writes Damien Cave for the New York Times. "What Cuba has ended up with is handcuffed capitalism: highly regulated competitive markets for low-skilled, small family businesses."

In 2012, Raúl Castro made a historic change to the country's travel laws. Under the new policy, which took effect in January 2013, Cubans are eligible to apply for passports to travel abroad, rather than having to acquire a formal letter of invitation and exit visa. Furthermore, Cubans are able to stay outside of the country for twenty-four months--extended from eleven months--without losing their status as Cuban residents. The new policy makes exceptions for "citizens who have obligations with the state or are not authorized under rules designed to preserve the skilled workforce and protect official information," in which case the state exercises its own judgment.

Raúl Castro has signaled he is willing to engage in dialogue with Washington. At the same time, says CFR's Sweig, seeking normalized bilateral relations is clearly not a priority for the Cuban government, which has moved to diversify its relationships in the region. "Cuba no longer seems to need to see the relationship with the United States improve as rapidly as it might well have, for example, when the Soviet Bloc collapsed and it lost its Soviet subsidy overnight," Sweig told CFR.org in a March 2009 interview. A 2009 Human Rights Watch report found that Cuba's judicial system remained oppressive, saying, "Raúl Castro's government uses draconian laws and sham trials to incarcerate scores more [political prisoners] who have dared to exercise their fundamental freedoms."

Why is Cuba on the State Sponsors of Terrorism list?

According to the State Department, Cuba remains on the list because it opposes the global war on terrorism; supports members of two Colombian insurgent groups, the Revolutionary Armed Forces of Columbia (FARC) and the National Liberation Army (ELN); and provides safe haven to several Basque ETA members from Spain. But some experts say there is little evidence to support these allegations.

The State Department reaffirmed its position after Cuba protested its addition to the list of countries whose citizens require heightened screening upon entry to the United States. State Department spokesman P.J. Crowley said, "Cuba is a designated state sponsor of terrorism, and we think it's a well-earned designation given their long-standing support for radical groups in the region."

What is the status of Cuba’s economy?

After introducing a few market reforms--opening up Cuba to tourism, allowing some foreign investment, and authorizing self-employment for certain occupations--in the early 1990s, the Cuban government reasserted central control. In 2004, Cuba reverted to a peso economy, with the government as the only body authorized to exchange pesos into dollars. Since Raul assumed power in July 2006, he has encouraged dialogue about the Cuban system, and in particular, the economy. This has led experts to speculate he might institute economic reforms. However, the economic devastation wrought by three hurricanes in late 2008 has "taken an enormous amount of energy and momentum away" from the government, according to Sweig. The global financial crisis is also taking a toll on Cuba. Currently, the economy is divided into the following revenue streams:

• Nickel. Cuba has the third-largest nickel reserves in the world. Nickel is the country's biggest export, bringing in roughly $2.7 billion in 2007 (Reuters). Nickel prices dropped over 40 percent in 2008 and severely affected Cuba's nickel export earnings.
• Tourism. Now the economy's largest source of revenue, tourists--primarily from Canada and the European Union--bring some $2.7 billion into the country, according to the Cuban government.
• Remittances. Academic sources estimate remittances total more than $1 billion a year, most coming from families in the United States. If limits on remittances are lifted, this figure could increase substantially.
• Sugar. Sugar was long the primary industry in Cuba, but production has plummeted due to outdated factory equipment. In 1989, production was more than 8 million tons, while the harvest in 2005 was only 1.3 million tons. The 2008 hurricanes damaged sugar crops in the eastern part of the country.
• Foreign investments. Cuba receives hundreds of millions of dollars in foreign investments from Venezuela, Spain, and China. Experts believe foreign investment from Venezuela might decline as the country suffers financial difficulties as a result of the fall in oil prices in late 2008 and early 2009.

How does Venezuela assist Cuba?

In October 2000, Chávez and Fidel Castro signed the Integral Cooperation Accord, an agreement that specified an exchange of Venezuelan oil for Cuban goods and services. The accord was reaffirmed and extended for another ten-year period in 2010. Venezuela now sells Cuba some 90,000 barrels of crude oil daily at preferential prices, and Cuba sends tens of thousands of medical professionals to work with Venezuelan communities. Florida International University's Martin calls the relationship "very intimate," and says it is getting "stronger and stronger every year."

Chávez also helps Cuba from an ideological standpoint. In addition to removing any incentive to approach other countries for economic assistance, Chávez 's support means that Cuba no longer stands alone against the United States. This "provides them with a kind of insurance policy that they haven't had since the Soviet bloc collapsed," Sweig says. Other experts point to Cuba's burgeoning friendship with China as an indication of the growing worldwide support for Castro's regime.