Albion Monitor /Commentary

Anti-Cuba Law Backfires on U.S.

by Dalia Acosta

(IPS) HAVANA -- The old Cuban saying that "God may squeeze you, but won't strangle you" can be likened to the effects of the Helms-Burton law, the latest attempt by the United States to economically isolate this country.

More than 30 years have passed since Washington began its embargo against the regime of President Fidel Castro but, while it has cost Cuba billions of dollars in lost revenues it has neither toppled the government nor distanced Cuba from the rest of the world. Helms-Burton appears unlikely to make any difference.

U.S. policy, meanwhile, has provided Cuban authorities with a reliable excuse for inefficiency although, on many occasions, the errors have had absolutely nothing to do with the measures cooked up in Washington.

"It used to be the blockade, and now its Helms-Burton," said a university professor firmly committed to the belief that lifting the blockade would benefit the United States far more than Cuba.

Cuba contends that a large part of the U.S. debts could have been settled in 1960

Former owners of expropriated U.S. property in Cuba, affected in 1960s by Washington's decision not to negotiate compensation, have seen the possibility of any solution to their claims gradually fade into the distance.

"The new law suspends possibilities for a rational resolution for the process of claims on nationalized property between the two countries," said Cuba's Minister of Foreign Investment and Economic Collaboration, Ibrahim Zerradaz. Cuba holds to the principle that any negotiation concerning compensation should operate at an intergovernmental level, on an equal basis, as was the case with Canada, Spain, Britain, Italy and Mexico.

Government sources contend that a large part of the U.S. debts would have been settled already if Washington had accepted the payment of compensation in the form established by Cuban legislation.

Cuba's Decree 851, issued on July 6, 1960, allowed for the forcible expropriation of property belonging to U.S. citizens or legal bodies on the island and the payment of these through the issue of Republic Bonds, to be redeemed within a period of no less than 30 years at an interest rate of no less than two percent per year.

The fund created for this end was fed by 25 percent of the income corresponding to the U.S. annual sugar imports from Cuba above a quota of three million Spanish long tons and at a price not less than 5.75 cents per British pound.

"These conditions on the compensation payments, backed by the traditional volumes of sugar exports to the United States, formed a real material basis for the expropriated goods to have been totally, or mostly, compensated," said Alejandro Aguilar in a study published by the National Institute of Economic Research.

Helms-Burton included measures against foreign companies established on the island that "trafficked" in former U.S. property

In 1972, the Foreign Claims Commission presented the U.S. Congress with a list of 5,911 approved claims against Cuba, whittled down from an initial 8,816, asking for compensation of $1.8 billion.

Most Cuban observers have used these figures when the time comes to evaluate the claims, but Cuban officials have stressed that checks never were made to see if the approved requests or valuations were true, inflated, duplicated, or even achieved with false documents.

Robert Muse, lawyer with the U.S. Mansfield & Muse legal concern, recognized in Havana that any legal claim would run up against the great obstacle that "the primary information on the ownership of property is archived in an unusable form and is only accessible in Cuba."

The Helms-Burton legislation, signed this year by President Bill Clinton in a response to the shooting down of two civilian aircraft which violated Cuban airspace, exhumed the old issue of compensation in an attempt to stop the flow of foreign capital to Cuba.

As well as maintaining the conditions of the economic, trade and financial blockade, the new legislation included measures against foreign companies established on the island that "trafficked" in former U.S. property.

During an international seminar in Havana last week, Muse commented that it was "hard to understand" the exclusive application of the law to the case of Cuba considering that its expressed aims are to demonstrate "a moral repugnance" to the "trafficking" of "confiscated" U.S. property.

"What then is the basis of the principles which allow the traffickers of property confiscated in Eastern Europe, Russia, China, Vietnam and Iran to enter the United States, when in the case of Cuba, these traffickers are excluded?" he asked.

The meeting, called by the Cuban company Associated Consultors, was attended by lawyers and entrepreneurs who looked into the implications of the U.S. bill.

40 new economic associations and joint ventures were established in spite of the influence of the Helms-Burton bill

According to the Cuban Foreign Investment minister, in the first eight months of this year, 40 new economic associations and joint ventures were established with foreign capital in spite of the influence of the Helms-Burton bill. Ferradaz said the quality and total value of these deals was worth more than those established during the same period of the previous year.

He added that no companies had asked to withdraw from Cuba, and that those participating in more than 100 new projects have appealed to the local authorities to make the negotiations more flexible.

A report from the Ministry of Economy and Planning pointed out that, despite the caution shown by the foreign investors, 240 economic associations with foreign capital are in operation, there are 660 accredited trade representations and twelve foreign banks have representatives here.

The only piece missing from the jigsaw is the United States, an absence which, according to the Cuban studies course at the U.S. John Hopkins University, affects some 200 companies interested in carrying out business with Cuba, freezing a multimillion dollar export potential. The annual losses of U.S. companies due to the lack of opportunities in Cuba, as a result of the embargo, was estimated at $750 million in 1988 and increased by between $1.3 million and $2 billion more in 1992.

Experts from both countries who have sketched possible developments in the "post-embargo era," claim the value of trade between the two nations could exceed $6.5 billion, and the flow of U.S. tourists could reach at least two million per year.

Local observers maintain that, while the authorities recognize the U.S. bill has stopped some deals in Cuba, they are sure the blockade is an anachronism, above all in its latest form which carries immense extraterritorial implications.

According to Muse, the Helms-Burton law is related to the "aspirations one nation holds in relation to another" and for him, as a private lawyer, the concern is to establish "which are the permissible ways to achieve these without contravening international law."

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Albion Monitor September 29, 1996 (

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