Change in U.S. Cuba Policy Could Benefit Alabama

Change in U.S. Cuba Policy Could Benefit Alabama

Selling chickens to Cuba is complicated.

"If the Cubans want to buy chickens in the United States, before they load it on a ship, they have to pay a bank outside the country," said Jimmy Lyons, director of the Alabama State Port Authority, which oversees the docks in Mobile. "Those funds have to be sent to a bank in the United States. Only then can the chickens be loaded on a ship."

If that seems like a peculiar example, consider: Alabama ships roughly 32,000 tons of frozen chicken to Cuba each year, part of a broad economic relationship with Cuba that chiefly involves agricultural trade.

President Barack Obama's announcement Wednesday that the United States would take steps toward normalizing relations with Cuba — which has been under a trade embargo from the United States since the early 1960s — could make it easier for Alabama to sell its goods in the island nation.

The announcement does not mean the end of the embargo, which would have to be overturned by Congress. However, the announced changes include new banking and financial rules and an easing of trade restrictions with the communist country that will facilitate business transactions between Alabama and Cuba.

Cuba has purchased food from the United States since 2001, and agricultural products, such as chickens, have been Alabama's chief export to the island nation.

State officials such as former Agriculture and Industries Commissioner Ron Sparks have visited Cuba, and other boosters have seen potential for business with the country, just 626 miles from the state. About a quarter of Alabama's agricultural export revenues in 2006 came from Cuba, according to a 2008 study.

Besides food, Alabama's other major export to Cuba is lumber, frequently in the form of utility poles, which Lyons said could be a harbinger of further demands — if relations continue to improve.

"There will be a tremendous demand (in Cuba) for infrastructure, and that's where the need is," Lyons said. "You could see companies in Alabama getting business. But that's going to take full normalization."

Under Raul Castro, Cuba has made some efforts at economic reform, though Human Rights Watch calls the state "the only country in Latin America that represses virtually all forms of political dissent." However, other nations have begun investing Cuba.

"I've got two or three friends who have gone there on business trips," said John McMillan, Alabama's Commissioner of Agriculture and Industries. "It's unbelievable what foreign countries like China are investing in hotels. There are some things going on there."

Lyons said there is potential for Alabama to further expand its existing trade with Cuba. The new regulations allow American tourists to buy up to $400 worth of goods during visits to Cuba, including up to $100 worth of cigars.

"How much it goes up depends on how much the Cubans can afford to buy," Lyons said. "As Cubans get more foreign exchange, that's money they will have to buy things."

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