After the announcement by the United States Department of the Treasury to put into practice measures, promised two years ago, to benefit the Cuban private sector, entrepreneurs on the island are waiting expectantly for the next step.
Businesspeople interviewed by OnCuba agree that it is a positive decision. However, several doubts remain about its actual implementation and permanence over time if U.S. President Joe Biden leaves the White House next January.
The measures include the ability to open and use U.S. banks through the Internet; export of software of Cuban origin from the United States to other countries; access to Internet services blocked for Cuba; and a financial decision to facilitate the sending of remittances.
U.S. authorizes Cuban entrepreneurs to open U.S. bank accounts through Internet
Good news, but delayed
“They are good, but late,” Alfonso Larrea, director of the private enterprise EVEXCON, which organized the first business meeting of MSME owners with U.S. and Cuban-American counterparts last year, said this about the measures.
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The businessman stated that the announcement of this decision was expected at the end of 2023, but a campaign in Miami against MSMEs boycotted that intent.
“The U.S. government authorizes it, but the banks can provide the service or not, so now it remains to be seen what they’ll do,” he commented.
For her part, Katia Sánchez, CEO of the digital communication agency La Penúltima Casa and host of a podcast that debates with Cuban entrepreneurs, assured that the measures do not take her by surprise, since there have been rumors.
“It was quite expected, but it’s also been a long time coming,” she said.
“Although there is optimism in the sector, we also have to wait to see how they develop, how they are put into effect and each of the associated specificities such as banks, taxes, risks, visas and other United States sanctions that could affect them,” she said.
The owner of the well-known light food brand Juanky’s Pan, Juan Carlos Blain, commented that he feels optimistic about the implementation of these decisions. However, he acknowledged that some moves that could have benefited the Cuban private sector have only been announcements.
Possible benefits
Alejandro Peñalver, owner of the online sales site CBM Tienda, explained that, if implemented, the possibility of operating accounts in dollars would allow him to reduce financial costs.
“Today we have a loss due to the exchange rate for the simple fact that clients pay in USD and I receive euros,” he said.
The young businessman also commented that it would be favorable to be able to access U.S. payment gateways, whose commissions are cheaper. “That would be a big advantage,” he pointed out.
Ease of financial operations, access to global financial services and greater integration into the international market are three of the benefits identified by Alain Peña, founding partner of the software MSME Pyxel Solutions.
“The decision to allow the export of software and mobile applications of Cuban origin from the United States represents a great opportunity for technological SMEs in our country. This opens the doors to a global market, allowing us to offer our products in international app stores,” he said about another of the measures announced by the United States.
Meanwhile, Yulieta Hernández, CEO of the enterprise πlares Construcciones, assessed that the measures are very positive, taking into account the unfavorable context in which Cuban businesspeople work.
“The country is in a condition of sustained, structural crisis, which right now has very strong repercussions on the development of our businesses, that is, not even on growth but on ensuring that our businesses are maintained,” she said.
2024, election year
However, the biggest fear of entrepreneurs is that these measures advance, the money is deposited into the accounts and a change of U.S. administration results in restrictive policies that harm them financially.
The outlook is uncertain, given that the distance between Joe Biden and Donald Trump in voting intention is very small.
Regarding this, Yulieta Hernández reflected on the risks that exist, above all, due to Cuba’s permanence on the list of state sponsors of terrorism.
“U.S. banking is private. There is a very high-risk perception with financial operations in Cuba. The question would be: how many banks are going to allow the opening of accounts? In my experience, I think there will be very few,” she stated.
Hernández commented that, if there are very limited opportunities, due to the law of supply and demand, bank taxes would not be favorable for entrepreneurs.
For his part, Liu León, owner of the LiangWare software development MSME, wondered how the opening of accounts from Cuba would be implemented, what documents would have to be shown, if it would be necessary to use VPN due to the blockade, or if the money could be repatriated to the country.
Meanwhile, Greta Tilán, an entrepreneur in the cosmetics sector, said she received the announcement of the measures with skepticism.
“Will the banks take the risk? Will we entrepreneurs risk the possibility of accounts being frozen?” she questioned. She stated that the outcome of the upcoming elections is crucial.
It’s just a first step
“The measures are positive, but they remain on the surface of the ocean and do not go deep, in harmony with the real needs of Cuban entrepreneurs,” considered Miguel Hernández, CEO of the local development project (LDP) Comunidad Colaborativa y Asesores, from Camagüey.
The economist, who runs this business consultancy, regretted that the new definition of entrepreneurs has not included LDPs like his, which are also private.
He commented that he still perceives few benefits for entrepreneurs when they are prevented from obtaining business visas and U.S. citizens are prevented from traveling to Cuba, for example.
Meanwhile, businesswoman Yulieta Hernández encouraged the Biden administration to provide other support to the sector, such as granting business visas to Cubans and the possibility of access to credit and financing. “This is now a first step of many more that are necessary.”
From activism
Professor Carlos Lazo, leader of the Bridges of Love movement, explained to OnCuba that “any measure that tends to alleviate the economic asphyxiation suffered by the Cuban people, no matter how small or insufficient it may be, is welcome.”
At the same time, he recalled that when at the beginning of May a group of Cuban-Americans from various organizations delivered a letter addressed to President Joe Biden asking for an end to the sanctions against Cuba, at the State Department, “the same officials told us that they knew how difficult it was for the banks to allow even the little that was allowed in terms of transactions to Cuba due to fear of the list of terrorist countries. And that they, State Department officials, had called banks to clarify that there were things that could be done, precisely because the banks, in a position, as they say in English, over jealous, which means they did not want to get into trouble, were not allowed to do, in terms of transactions and bank accounts, not even what was allowed.”
“Although it is a positive measure, the effect it will have on the Cuban economy will be almost zero, if it has any effect at all; the effect on the self-employed is going to be almost zero if at all it has any effect…because the obstacles will continue for this type of bank accounts as long as Cuba is on the list of state sponsors of terrorism; even while the blockade exists, but above all that list makes banks very afraid of interpreting the measure in a certain way; knowing, furthermore, that President Donald Trump could again come out, and that he would reverse all those measures and they could even be sanctioned by the new administration or by another interpretation of the law.”
“It seems to me that it is perhaps an electoral move because President Biden and the administration at this moment feel that, first, those who did not vote for them, Republicans, Trumpists, are not going to vote for them; and second, those of us who vote for Biden, those of us who actively participate in his campaign, those of us who support the president on all fronts, many are disappointed. The perception I have is that they want to give a vote of punishment to the president for having done practically nothing and for having allowed the living conditions over there of the family of those of us who live here have deteriorated terribly; and that is due, in large part, to the continuation of Trump’s policies under the Biden administration.”
For its part, the Alliance for Cuba Engagement and Respect (ACERE) praised the Biden administration “for finally implementing long overdue regulations — initially announced two years ago — designed to support the growth and operations of Cuba’s independent private sector and increase access to web-based services for all Cubans.”
This is affirmed in a statement in which they add that “Cuba’s rescission from the list is also vital to encourage the resumption of European tourism to Cuba, which particularly benefits Cuba’s private Airbnb hosts, restaurateurs, taxi drivers, agricultural producers, cultural workers, and others.”
“Resuming nonimmigrant visa processing in Havana would help facilitate Cuban entrepreneurs’ travel to the United States for business activities and the marketing of their goods and services, as well as their acquisition of essential U.S. products for use and sale in their businesses on the island,” the statement continued.
“While ACERE expresses concern that these measures took two years to implement after having been announced in May 2022 — reportedly over pressure from members of Florida’s congressional delegation — today’s announcement shows that the Biden administration can and should pursue a foreign policy toward Cuba that not only bolsters the operations and market share of U.S. businesses and service providers on the island but also supports the Cuban people and civil society by removing obsolete, U.S.-imposed restrictions.”
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Osvaldo Pupo
it will only benefit USas always , the money of the hard worker of Cuban people private sector sitting on a foreing bank … what are you thinking…. keep selling your country