Cuban economy assessed as stable

Businessmen who recently returned from a visit to Cuba dismissed the notion yesterday that that country's economy will collapse with the passing of President Fidel Castro, or that his death will spur an exodus from the island.

Questions about the effect of Mr. Castro's political departure or death have taken on urgency since his hospitalization last year and ceding of power to his brother Raul.

Meanwhile, dozens of federal, state and local agencies participated with the military in an exercise in Florida this week to prepare for any influx of Cubans when Mr. Castro dies.

Wayne S. Smith, a senior fellow at the Center for International Policy, which sponsored the businessmen's trip, disputed the idea that Mr. Castro's death or departure would bring down Cuba's system.

"This idea that the Cuban economy is collapsing and the regime is on the ropes is absolute nonsense," he said, adding that Cubans are not likely to flee the island in the event of Mr. Castro's death.

Efforts have begun in Congress, with its new Democratic majorities, to chip away at the U.S. embargo of Cuba. Businessmen who participated in the trip offered cautious appraisals of economic opportunities for U.S. firms.

Timothy Deal, senior vice president of the U.S. Council for International Business, said Cuba has reached a critical point and is "looking to the outside world to provide new resources."

The U.S. embargo allows certain cash sales of food to Cuba. Daniel O'Flaherty, vice president of the National Foreign Trade Council, said the United States is Cuba's third-largest source of imports, while Cuba is a major market for U.S. rice, chicken and wheat.

Jake Colvin, director of the pro-trade industry group USA Engage, said Cuban interest in outside investment is more limited than its interest in trade but that Havana has a particular interest in outside investment in the energy sector, including oil and gas production.

Rep. Jeff Flake, Arizona Republican, said the United States lacks meaningful information about activity in Cuba. He previously sponsored legislation to allow U.S. companies to work with Cuba to exploit oil reserves, and is likely to introduce similar legislation this year.

U.S. diplomats in Havana, he said, are capable but are "so totally divorced from reality because ... they can't meet with the Cuban government."

He termed U.S. diplomacy toward Cuba "sophomoric."

"And then we wonder why we get bad intelligence in Cuba about the transition. It's because they can't and won't talk to anybody there," he added.