- The Washington Times - Monday, November 25, 2002

U.S. exports to Cuba have skyrocketed from a year ago.
The United States sent $109.4 million in goods to Cuba from January through September, according to government figures released last week. In 2001, the United States shipped $2.3 million in goods during the same time.
The surge in sales reflects an opening for agricultural exports available since 2000 but used only since late last year. The Cuban market's increasing value has deepened interest in exporting among U.S. producers and is adding political momentum to calls for further relaxation of trade barriers.
The communist nation must pay U.S. companies cash upfront to ensure payment. Foreign companies that extend credit have had problems being paid.
"The ball is back in Congress' court," said an aide to Rep. George Nethercutt, Washington Republican. Mr. Nethercutt sponsored the legislation allowing agricultural sales to the island nation.
As soon as January, Congress will consider measures to lift a tourist-travel ban, allow at least some financing for exports, expand the list of products that can be sold and speed the application process for exporters, said the aide, who asked not to be named.
The House approved some of those measures this year, but they died in the Senate. The White House has resisted loosening the trade and travel ban, and has argued against financing, saying Cuba doesn't pay its debts.
The head of the American Farm Bureau Federation said Friday that his group will back efforts to allow farmers to use financing.
"We believe that private entities should have the opportunity to provide financing if they so choose," said Bob Stallman, president of the federation, which represents 5.2 million American farm families.
Cuban officials want the embargo lifted and blame it for severe economic difficulties.
The local economy, widely inefficient and under tight government supervision, fell into a deep recession in the 1990s after the loss of Soviet subsidies. Last year it took hits after September 11, when worldwide tourism dropped, and from Hurricane Michelle, which caused widespread destruction.
Even without more liberal trade rules, exports to Cuba have picked up dramatically. For all of 2001, the United States exported $6.9 million in goods to Cuba, about two-thirds of that in December.
The figure is a tiny fraction of the $730.9 billion in goods that the United States sends abroad annually.
Alimport, the Cuban-controlled company that buys the U.S. products, calculates that agricultural purchases from the United States will reach $175 million this year, said Pedro Alvarez, Alimport's chairman.
Total Cuban agricultural imports are about $1 billion, he said.
Without trade restrictions, U.S. companies could fill about 60 percent of Cuba's agricultural import needs, which are expected to reach $1.5 billion by 2005, Mr. Alvarez said.
One big question is whether Cuba can afford to pay for that much. U.S. law mandates that cash be paid for deliveries to Cuba, so U.S. companies cannot extend credit. The measure was included in the legislation because foreign companies have had difficulty collecting payments from Cuba.
Even with potential problems, many companies are eager to sell to the market, taking advantage of Cuba's needs and proximity.
"We need more markets for the products we raise. This looks like one opportunity," said Henry Chiles, owner of Crown Orchard Company, a Batesville, Va., grower of apples, pears and nectarines.
Mr. Chiles' company is one of 10 from Virginia that discussed agricultural exports at a Havana trade fair in September. He signed a deal and is waiting for final approval from Cuban inspectors before sending his first shipment of apples. The inspectors were scheduled to arrive last week, but the trip was postponed until January.
Mr. Chiles is still cautious about the opening market.
"My initial thought was there might be some opportunity there. But we won't really know until we see what problems there are," he said.
Virginia companies are poised to sell about $1 million in agricultural products, mostly apples, to Cuba, said Thomas Sleight, director of the Virginia Department of Agriculture and Consumer Services' marketing division.
The Trade Sanctions Reform and Export Enhancement Act, which allows food sales to Cuba, was approved in 2000, but Cuba did not start buying U.S. agricultural goods until the end of last year as its government measured the fallout from Hurricane Michelle. Michelle was the strongest hurricane to hit Cuba since 1952 and caused widespread damage across the central and western parts of the island.
Wheat, soybean products, corn, chicken and rice are the biggest U.S. exports to Cuba, according to the U.S. Census Bureau, which tracks export sales figures. Charitable donations, medicines, some plumbing fixtures and TV antennas are included in export figures.
Companies are eager to see measures that will help boost sales.
"Once you give companies a taste, they're going to want more," said John Kavulich, president of the U.S.-Cuba Trade and Economic Council Inc., a New York business organization that provides information on exporting to Cuba.


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