Cuba makes poor trade partner for Louisiana

March 13, 2005 | ShreveportTimes.com
By Frank Calzon

A March 8 Times editorial suggests Gov. Kathleen Blanco's "Cuba trip [is] politically risky [but] pragmatically right." Let's cut through that fog of wishful thinking: Fidel Castro is broke.
U.S. law allows Cuba to buy whatever food and medicine it needs on a cash-and-carry basis. Because Castro knows he can't continue paying for what he "buys," he's pressuring eager sellers to lobby our government to extend credit and provide export insurance. If he gets what he wants, American taxpayers will pick up his unpaid bills. Not surprisingly, Congress and the Bush Administration are resisting. Indeed, most Americans understand it's not good business to sell to deadbeats.

Sugar production in Cuba, once the cash cow supporting foreign trade, is at an all-time low. To maintain his communist state, Castro has been robbing Peter to pay Paul. Former Secretary of State Colin Powell testified to Congress that foreign governments complain Castro is stiffing them to get the cash to pay for goods he has bought from U.S. suppliers.

Sysco Corp., the U.S. food-service provider, canceled its trade deal after discovering an "advocacy agreement" was included requiring the company to support lifting what remains of the U.S. embargo. The Manatee County (Fla.) Port Authority last year rescinded an agreement because of a similar quid pro quo. American companies want trade; Castro wants to buy their political influence.

Trading with Havana is freighted with politics. When you sell, you tow the Castro line or you don't get paid.
After a tiff with Mexico's president, Castro stopped payments on Cuba's commercial debt to Bancomext, Mexico's foreign trade bank. Bancomext is now at an international court in Paris attempting to collect $50 million of an estimated $300 million Cuba owes Mexico.

Other international creditors have impounded Cuban ships in Africa and Europe to collect what they're owed.

In 2003, Cuba's National Bank reported a national debt of $12.21 billion; today that hard-currency debt totals $13.288 billion. Castro refuses to pay a $20 billion debt to Russia because "it is a debt to a country that no longer exists." In 1986 he stopped payments to the Paris Club, an international consortium of Western creditors. France, South Africa, Thailand and others have since suspended credits and export insurance. In January, the Spanish company Central Lechera Asturiana said it is leaving Cuba because "speaking from a business point of view, the island of Cuba is a lost cause."

One more point: Louisiana U.S. foodstuffs are unlikely to reach average Cubans. They're too expensive for people living on salaries of $10-$15 a month. Imported foodstuffs are mostly served in state restaurants to foreign tourists -- tourists whose money subsidize Castro's repression at home and his anti-Americanism abroad.

Frank Calzon is executive director of the Center for a Free Cuba, based in Washington, D.C.