The Obama administration relaxed trade rules with Cuba, changes that were promised when President Obama announced normalization of relations on Dec 17. The Treasury and Commerce departments published regulations in the Federal Register to facilitate trade. “These changes will immediately enable the American people to provide more resources to empower the Cuban population to become less dependent upon the state-driven economy, and help facilitate our growing relationship with the Cuban people,” said the White House.
The revisions include a new Treasury Department interpretation of the “cash in advance” rule for sales to Cuba to mean “cash before transfer of title and control” instead of “cash before shipment.” Farm groups complained for years that “cash before shipment” slowed agricultural sales to Cuba and drove up costs by forcing ships to wait in U.S. harbors before sailing to Cuba. Treasury also changed its rules so U.S. banks can have correspondent accounts in Cuban banks. Until now, payments had to be routed through third-party banks, which entailed additional fees and time.
The Commerce Department revised rules to allow sales of tools and equipment to small farmers, along with allowing sale of building materials to the private sector and goods to small businesses including restaurants. Said Sen Jerry Moran, Kansas Republican, “Amending these regulations is not just about increasing commercial ties for agriculture producers in Kansas and across the country – I believe closer ties could help change the nature of the relationship between the Cuban people and their repressive government.”.
A Treasury Department fact sheet on the revisions is available here. A statement by Treasury Secretary Jacob Lew is available here. The White House fact sheet, “Charting a new course on Cuba,” issued on Dec 17, is available here.