by Pete Norstrum,
Miami
What US
embargo?
" Thanks to foreign subsidiaries and third parties,
the 34-year-old blockade
hasn't deprived Cuba of even US roller blades or boom boxes."
Despite a US embargo more than three decades old, US products
and its internationally renown brand names are still normal, (but
expensive) items in Cuban supermarkets and department stores.
In the seaside lobby of a posh hotel, local businessmen and tourists,
sip Coca-Cola while skimming through The New York Times. At appliance
stores, shoppers wait up to an hour to buy Zenith color televisions.
At a trendy new shop called Guess USA, teenagers browse racks
of American-made jeans.
Cubans who can afford them, wear Nike tennis shoes and smoke Marlboro cigarettes. Men buy Barbie dolls by Mattel for their daughters and eye shadow by Max Factor for their wives. They use Kodak film, watch Sylvester Stallone movies and brush their teeth with Colgate toothpaste.
Forget the US trade embargo against Cuba. Forget the Helms-Burton
Act. Forget any and all attempts to isolate the hemisphere's last
bastion of communism.
America is trading here in force. Thanks to foreign subsidiaries
and third parties, the 34-year-old blockade hasn't deprived Cuba
of even US roller blades or boom boxes. While most US products
still are available only at Ôdollar' stores, an increasing
number of US goods are finding their way to the open market as
well.
"Cuba is free to purchase whatever products it wants,
and we've been increasing our ties with other countries, so you
will find more US-type products here now," said Carlos Fernandez
de Cossio, director of the department on North America at the
Cuban Foreign Ministry.
Coke products, Gerber baby foods, and Campbell soups come in via
Mexico. McIlhenny Tabasco comes in via Venezuela. American bubble
gum comes in via Panama. All of it contributes to $300 million
or so a year in legally permitted trade through intermediaries,
say economic experts.
"This is all part of the fact and fiction of the US embargo,"
said Ignacio Sanchez, a Miami attorney and member of the board
of the Cuban-American National Foundation. "The embargo says
that US companies can't sell to Cuba, but it does not prohibit
these companies from selling to the rest of the world," Sanchez
said.
"There's nothing illegal in the US about this situation,
since American manufacturers are not responsible for their goods
once they are sold to third parties."
He added that the Cuban government has for years set up companies
in Panama designed to buy US products for export to Cuba, a charge
that Cuban officials would not confirm.
"If a US company sells a product outright, there usually
isn't anything written into the agreement that would prohibit
the buyer from re-exporting that product to Cuba, or anyplace
else," Sanchez said.
Most companies that distribute US products to Cuba are located
in Latin America, which have been seeking new markets for years.
Long confined to local customers by protectionism, Latin companies
are now exporting products to many countries, including Cuba,
in record numbers.
"One such company is Mercaribe Mexico, based in Mexico
City, which displayed everything from Coppertone suntan lotion
to Palmolive soap at a recent trade fair. Last year, the small
wholesaler exported about US$500,000 worth of US brands to Cuba.
"Before about two-and-a-half years ago, people in Cuba didn't
have enough money to buy something to eat," said Mauricio
Gonzalez, manager of Mercaribe. "But now people have a little
extra money and they are spending it on other things."
Cuba has become a good customer for such distributors. Faced with more than a million tourists this year Ñ a 25 percent increase over 1995 Ñ the government is anxious to buy the products their visitors want to consume. And with estimated $1 billion in revenue from these tourists, it has the money to do so.
"Cuba's tourism industry has become very important to
the country, and it depends on imported goods," said Damian
Fernandez, who chairs the International Relations Department at
Florida International University in Miami.
"Rather than go native, tourists want to consume products
that are familiar to them, so the government must make them happy
and provide these products."
Fernandez says imports of US products from third parties has
been increasing since 1991, when Cuba started paying for Russian
goods with hard currency instead the barter arrangements that
existed before the collapse of the Soviet Union.
"Cuba didn't want to spend hard currency on lesser-quality
products from Russia when it could get higher-quality products
elsewhere," Fernandez said.
To be sure, most Cubans still don't have the money to buy US products. The vast majority live hand to mouth, relying on monthly rations from state grocery stores. Items such as detergents, diapers, and underwear are simply out of reach.
In 1993, the government allowed ordinary Cubans to hold dollars, introducing a parallel economy in which money is actually worth something. With dollars returned to legal circulation, remittances from Florida have risen to more than $500 million a year. Today, the government estimates that some 40 to 50 percent of Cubans have access to dollars.
On any given day, these Cubans pack what were once called "The
Diplotiendas," or the hard-currency stores once reserved
for foreign diplomats, to buy everything from Kraft Cheez Whiz
to A-1 Steak Sauce. Despite prohibitively high prices (a can of
ravioli costs $4) lines that snake around busy check-out counters
contain dozens of harried consumers.
"American products have a sort of status attached to them,"
said Carmen Estevez, a mother of two. "The kids look at American
movies, so they see American products, and that's all they want,
because they are considered the best."
Executive Time "Online" also has a printed version which is available throughout the Caribbean and some selected North American cities.
