Press Pool Report #3: Governor Abbott’s Business Development Mission To Cuba
Pool report provided by the Austin American-Statesman
Texas Gov. Greg Abbott said afterward that maybe it is the lawyer in him, but at the end of a narrated slideshow about all the benefits of foreign investment in Cuba’s showpiece Mariel Special Development Zone, he cut to the chase.
Abbott said he knew that the port directors from Houston, Beaumont and Corpus Christi who had accompanied him on the trip, “as well as the state of Texas have a deep interest in trying to find a way that we could collaborate on this project.”
But, he asked, is it possible under the U.S. embargo on trade with Cuba – or as it is called here, “the blockade” – for a U.S. company to legally invest in the Port of Mariel development.
No, he was told by Ana Teresa Igarza Martínez, in an answer that didn’t really require translation. The blockade won’t allow it.
“Are there any such businesses from the United States at this time,” seeking to invest there, Abbott asked.
Well, she said, there is in fact one proposal pending. It is from an enterprising Alabama company – Cleber LLC – which is seeking to use some loopholes in the embargo to build a small assembly plant in the economic zone to make tractors in Cuba – taking advantage of the exemption for agricultural products. They would also sell them in Cuba but, again exploiting the fine print of the embargo, would sell not to the state but to non-government cooperative farms.
The Cubans are waiting to see if federal officials in Washington agree that it doesn’t run afoul of the embargo and can be licensed.
Abbott, in an extended interrogation of Igarza Martínez, said that Texas had plenty of products, including fine quality, long-grain rice, to sell to the market in Cuba, where the government is obliged to provide each of its 11 million people at least seven pounds of rice every month.
“Texas has an abundance of (rice and other products), and a very easy ability to export from Texas to Cuba,” Abbott said.
But Igarza Martínez said that, “due to the blockade restrictions and the economic situation of the country, that is no secret,” Cuba can simply not afford to pay in cash for U.S. rice when it can buy rice from other, albeit far more distant places, chiefly Vietnam, because of their extended credit terms.
“The price is not as difficult as having to pay in cash,” she said.
“The last two days we’ve been leaving a lot of cash in Cuba,” Abbott said of his entourage.
Indeed, the answer for Cuba’s cash crunch would appear to be foreign visitors. Igarza Martínez said Cuba would be approaching four million visitors this year – nearly twice as many as last year – and on a trajectory toward ten million tourists in the foreseeable future
Over the next ten years, Cuba is expecting to add about 80,000 hotel rooms.
If so, Abbott said, “You will need American products your visitors are accustomed to.”
“Rumor has it that tourists prefer American rice,” Abbott said.
To which Igarza Martínez said something to the effect that “the American tourist is a tourist of selectivity.”
But she made clear the creation of the billion-dollar Port of Mariel and its development zone was not so Cuba could simply import foodstuffs, but rather to attract the kind of capital investment that, she said, even a socialist country knows is vital.
One possibility would be for the U.S. to send raw rice and, if they could gain approval form Washington, invest in milling it at the Mariel site. But the U.S. rice industry and the Texas cargo ports are built on the model of selling milled, not raw rice.