Should the U.S. seek to tighten its economic grip on Cuba? If so, why?

Ans:

A distance of 90 miles (144 kilometers) separates the Republic of Cuba from the United
States of America. That distance is close enough for cultural if not political influences
between the two countries. US should not extend the economic restrictions on Cuba,
mainly because it would more likely hurt its economy than achieve its foreign policy aims,
which have proved to be unattainable for last 40 years. On one hand US may seek to slow
down the flow of dollars to Cuba to weaken Castro’s positions and speed his downfall,
however it will hit American economy by mostly affecting air charter companies and
money-transfer services now operating in Cuba.

From a practical standpoint, most would argue that without the cooperation of the rest of
the world, there is little left that the United States can do. Further, given that China is now
a member of the World Trade Organization (WTO) and nations like Vietnam are trading
with the United States, the Cuban embargo gives the appearance of cold war relic that is
no longer relevant in today’s world. However, given the consensus that Cuba consistently
violates human rights, the continuance of U.S. trade sanctions against Cuba is consistent
with U.S. policy. In addition, Cuba’s expropriation of American property without
compensation is internationally recognized as unacceptable behavior; thus, retaliation can
be seen as an appropriate response. Finally, there is the continuing argument that if the
Cuban economy can be further weakened, Castro may at last be overthrown.

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2. Should the United States normalize business relations with Cuba? If so, should the United
States stipulate any conditions?

Answer: Embargo is a definition of hatred against one nation. It only rectifies the crudeness in
inhumane rules and regulations causing distress and unhappiness amongst the people who are
deprived of family interaction and relations. Not only so, the restriction on not allowing the
Cuban and Cuban exiles to cross borders to America, nor can the American and subsidiary
companies can do business with Cuba otherwise would face severe penalization. It deprived the
Cubans to get access to consumer goods of America, develop their infrastructure, and remain a
poor country.

Trade is not just money and entrepreneurial opportunities. It also means exposing an economy
to different ideas, and ideas that are an anathema to a bureaucracy that is in power. The
benefits of the Cuban embargo may have been relevant during the Cold War. Today, however,
it seems to be more of an impediment to Cuban-American families and companies who seek
entry into Cuban markets. There is a considerable amount of money to be made for both
countries if trade opens up and with trade opening up, there might be pushes to get a more
constitutional government. However, for that to happen, there needs to be pushes to get rid of
the embargo. Nonetheless, the advantages of engaging Cuba is significant from businesses
perspective and diplomatic ties are beneficial, especially with a country so close to our borders.
In the past, methods of exclusion have produced tense and rigid structures that require even
more energy to maintain.

Moreover, the actual victims of this unwise policy are the two generations of Cubans who are
deprived of U.S consumer products under the act of embargo. In addition to that, they were
completely secluded from the notion of democracy and freedom the totalitarian nation.
Meanwhile, the closest allies of the U.S have not stopped to trade and do business with the
Cubans and have made prosperous deals with them. They have been active in setting up
business to take share of the Cuban market and are sending tourists to Cuba, which the U.S are

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not fully part of as yet. The Americans have a big market opportunity in Cuba for their
agricultural products and should exercise their power to normalize business relations with
them. Embargoes are almost meaningless when the rest of the world ignores them. The U.S.
should end the trade and business embargo with Cuba and move quickly to allow tourism
between our two countries. Most importantly, they should restore full diplomatic relations with
Havana. Only then will we have the leverage to press the new Cuban leadership to restore
human rights, establish a free market-based economy, and move to democracy.

Historically, American foreign policy towards Cuba has been a process of negotiating with
financial incentives in return for political reform and, as the Cuban embargo demonstrates,
Cuba has been resistant in conceding to these demands. Instead, the United States’ foreign
policy on Cuba has partitioned relations and created a “West versus the Rest” mentality.

The consequences of the Cuban embargo were felt almost immediately by all Cuban business
owners, ranging from small to big, as well as the many investing companies from abroad. Cuban
reliance on sugar export to the United States further affected the Cuban economic structure.
This economic area serves as a conduit for future diplomatic exchanges. Also, this area could
potentially lift the burden that the United States has placed on the Cuban economy. Economic
sanctions will only continue to promote slow development of revenue earning sectors in Cuba
and restrict access to both Cubans and Americans to markets of labor and manufactured
products. Such sanctions, as history has shown, will reluctantly force Cuba turn to other nations
who can provide access to their markets.

Thus, the U.S should try to fully leverage their business and trade with the Cubans, but have to
make rules for the security the American nation in terms of illegal drug business and other
illegal forms of business, which might increase detrimentally due to the free access across
borders. This is big concern and U.S should impose conditions on such things , that if any such
illegal businesses are found to be conducted then, there would deductions in areas of certain
business and export/ import. This would create a sense of concern continuously amongst the

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Cubans to not violate the terms and conditions. Moreover, the U.S government must impose
stricter terms and conditions on financial incentives to the Cuban businesses or government,
that is, they must emphasize heavily on the political reformation and human rights reformation
for the good of the nation.

Therefore, the normalization of business relations between Cuba and America is beneficial to
both the parties and causes more returns for the majority of the people. Under the utilitarian
theory, a greater good for greater part of the society, this will be fulfilled. After the lifting up
embargo and allowing open business, U.S must also provide strict conditions on ensuring a
secured and safer means of business, which will not allow any illegal drug trade in the U.S
nation. Also the human rights and freedom of choice should be exercised if the business
relations are made normal.

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Q3. Assume you are Fidel Castro. What kind of trade relationship with the United States would
be in your best interest? What type would you be willing to accept?

To think like Fidel Castro it is important that we take a brief look at his background to ascertain the
type of decision maker he was and his decision making traits.

Fidel Alejandro Castro Ruz is permanently in the history books and known as a leader of
tremendous capability and his revolutionary leadership quality. He was born in 13 th August 1926 on
a sugar plantation in eastern Cuba. He was a powerful and charismatic speaker and soon emerged
as one of the leaders in the growing movement against the dictatorship of Fulgencio Batista and the
Cuban revolution under his leadership overthrew Fulgencio Batista. He became the prime minister
of Cuba in December of 1959 and remained in the office till December of 1976. Soon after his victor
he began to steer the country towards communism by collectivizing farms and nationalizing banks
and industries including $1m worth of U.S. properties. Fidel Castro suspended political liberties and
jailed government critics.

Mr. Castro fostered a close alliance with the Soviet Union, a policy that put Cuba on a collision
course with the United States. Washington imposed a trade embargo against Cuba in 1960 and
broke off diplomatic relations in early 1961. In 1965 he became the first secretary of the
Communist Party of Cuba and led the transformation of Cuba into a one-party socialist republic.
Mr. Castro built up his armed forces and sent his troops around the globe to various Cold War
hotspots, such as Angola. He also supported leftist guerrilla movements in Latin America in the
1960's and 70's in an attempt to spread communism in the hemisphere.

At the same time, Mr. Castro established a health care and education system that lifted Cuba
among the top nations in the developing world for high literacy rates and low infant mortality.
These achievements in social welfare came at the cost of human rights and democracy. Towards
the end of 1976 became the president of Cuba and remained in office till his resignation in 2008.

Now to think like Fidel Castro it is important to take into consideration his personality traits and the
U.S. – Cuba history so far. Fidel Castro would most definitely want to improve Cuban economy and
enhance its growth. To do so it is important to be in trade with the largest economy and to take
some sort of incentive or subsidies from them to compete with such a large economy and well

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established producers. The economic growth prospects from the U.S. trade would possibly make
Castro even more popular among the Cuban and thereby reassuring longer time at the office as a
leader. Therefore it is important to improve the trade relations and in general political relations
with U.S. However there would be a conflict of interest if U.S. would want to inflict a social or
political ideology change in Cuba. A clear line of rules, regulations and expectations from one
another needs to be outlined before any trade can occur. Fidel Castro would not want to give away
full ownership of the companies of firms that would engage in the trade thus the U.S firms willing
to invest in Cuba must have to do so via indirect investment methods in the short run.

There is clear scope for profitable trade between the two countries which was clear in 2000 when
Cuban agricultural products were allowed in the U.S. market and soon Cuba became the 25 th largest
supplier to U.S. This being said the proximity of the countries also greatly bolster trade.

I would be willing to accept any form of direct investment that would come the countries way as it
is important to develop the infrastructure. Beginning to trade with U.S more openly would also
mean the other friendly countries of U.S would also be a potential market and the outcast status
that is tagged on the country would be lifted. In addition the Cuban products that are being
smuggled into the U.S can then be traced and proper taxation revenue can be enjoyed. Since Cuba
already have a comparative advantage in tobacco products opening up the markets for foreign
direct investment could meant the products becoming even more popular and far reached. As with
products like tobacco prices are insensitive and could mean a steady flow of income for years.

Any form of subsidy with unbound or bound conditions should be accepted as it is important for
the country to survive and develop. However political decision making should not be given out to
U.S.

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