Press Pool Report #1: Governor Abbott’s Business Development Mission To Cuba

November 30, 2015 | Havana, Cuba | Press Release

Pool report provided by the Austin American-Statesman

HAVANA  - Gov. Greg Abbott landed in Havana Monday afternoon leading a business development mission of two-dozen Texans looking to reintroduce Texas agricultural products to a growing Cuban market and plant the Lone Star flag on an island that for the first time in more than half a century has formal diplomatic relations with the United States.

Abbott’s entourage of 26, including himself and First Lady Cecilia Abbott, was made up of members of the governor’s staff and economic development team, and representatives of economic interests with a stake in increased trade with and travel to Cuba, including officials from the ports of Houston, Beaumont and Corpus Christi, and Houston’s airports.

The delegation arrived after a two-and-half-hour charter flight at José Martí International Airport to a muggy heat and were each handed little portfolios, the size of a passport, which detailed, in numbered order, who was on the trip, and an hour-by-hour itinerary for the visit.

It was the official “Program for the working visit to the Republic of Cuba by H.E Mr. Greg Abbott, Governor of the State of Texas of the United States of America.”

Abbott is the second governor to travel to Cuba since President Obama’s new policy of rapprochement by executive action led to the reopening of the American embassy in Havana over the summer.

Gov. Asa Hutchison of Arkansas, a major rice and poultry state, led a similar delegation to Cuba in September.

New York Gov. Andrew Cuomo, a Democrat, visited Havana in the spring to a great crush of news coverage, before the embassy was reopened.

The trip by the Texas delegation will be whirlwind – 51 hours from wheels-down in Havana Monday to wheels-up Wednesday evening for the return home.

It will include a tour of the Cuba’s state-of-the-art Port of Mariel, and meetings with a variety of Cuban trade and tourism officials. It will culminate with a meeting with José Luis Toledo Santander, president of the Constitutional Commission of the National Assembly of the People’s Power.

Abbott’s trip is freighted with symbolic significance. He is the conservative Republican governor of Texas, the second largest state in the union and the world’s 12th largest economy.

As a politician, Abbott is not one to leave his right flank exposed, and his decision to make a high-profile trip to Cuba his second international trip – the first, in September, was to the obvious destination of Mexico – was as sure a sign as any that there is little political risk, outside certain Cuban-American circles, still mostly concentrated in Florida, in the move toward closer economic relations with Cuba, even if it is an opening being championed by President Obama.

“This is symbolically important,” said James Williams, president of Engage Cuba, a recently formed nonprofit advocacy group lobbying Congress to end travel and trade restrictions with Cuba. “There’s nothing that says mainstream Republican Party, anti-Obama, anti-everything about his agenda than the governor of Texas. It means something.

“Opening trade with Cuba could be a watershed moment for Texas’ agricultural interests and its seaports,” Williams said. “According to some estimates, it could generate $57 million in new exports and result in 1,500 new jobs in the state.”

It was only in May that the Obama administration removed Cuba from its list of state sponsors of terrorism. But everyday Cubans, many of whom rely on remittance from family in the United States, have long held Americans in fond regard.

And Cynthia Thomas, the president of TriDimension Strategies, who made the arrangements for the trip, said there is a special affection for Texans.

Thomas, founding president of the Texas-Cuba Trade Alliance, who has made 38 trips to Cuba, said Cubans like the fact that when other Americans visit they say they are from the United States, but when Texans visit, they say they are from Texas. They like the state’s independent spirit. And they like Westerns, which are considered wholesome family fare in Cuba.

She said that when the Texas Farm Bureau set up a booth at an international food fair in Havana some years ago, there was disappointment among the Cubans that pictures of cattle ranchers showed them wearing baseball caps.

 “Where are the cowboy hats?” they asked.

Thomas said Abbott’s visit will also turn heads in Havana because he will be navigating the beautiful but decrepit city in a wheelchair.

“It’s really an incredible statement to have someone who is in a wheelchair to be so determined that this is a good idea to be willing to take on the challenge,” Thomas said. “I’ve never seen a wheelchair in Cuba in my life in all my times there.”

Improving relations with Cuba is broadly popular with the American public.

According to the latest Pew Research Center survey, conducted in July among 2002 adults, 73 percent of Americans say that they approve of the U.S. re-establishing diplomatic relations with Cuba, up ten points since January, and 72 percent back lifting the trade embargo – which would require congressional action - and ushering in a new era of U.S. investment and trade with Cuba. While Democrats are more supportive of the change, 56 percent of Republicans, up 16 points since January, also favored renewed diplomatic relations.

But there are still those who adamantly oppose the shift in approach and don’t believe it will end well.

Sebastian Arcos, associate director of the Cuban Research Institute at Florida International University, said that Obama’s new Cuba policy has raised hopes and expectations for new business opportunities in and with Cuba. But, he said, those hopes and expectations are not well founded.

Arcos said Cuba is still in the grips of the exact same people who seized power in 1960, confiscating $1 billion in U.S. property, and instituting a repressive regime that has not relaxed its hold on the economy and the everyday minutiae of Cubans’ lives.

Increased investment in Cuba will only serve to enrich and entrench them in power, Arcos said.

While Williams said the failure of the embargo to change the behavior of the Cuban government is proof the policy has failed and the embargo should be lifted, Arcos said lifting the embargo would demonstrate that Cuban intransigence had won out.

“They’re essentially being rewarded for misbehaving,” Arcos said.

The U.S. government placed a partial trade embargo on Cuba in 1960 and a full embargo in 1962. However, legislation in 2000 allowed for the export of agricultural, food and medical products to Cuba on a cash-in-advance basis.

Those exports peaked at $711 million in 2008 and have since fallen to $299 million in 2014, according to Parr Rosson, a professor of agricultural economics at Texas A&M University, and leading expert on trade with Cuba.

Of the $299 million in exports in 2014, only $6.3 million went through Houston ports, less than from any of the nine Southern states through which virtually all of trade to Cuba flows.

Topping the list, $81.8 million went through Louisiana ports, followed by Florida at $77.2 million.

Rosson said the decline in U.S trade with Cuba was a consequence of price competition, the strength of the dollar, and the inability of U.S. companies to offer credit to a country pressed for hard currency.

Brazil, Canada, Argentina, Mexico, Spain, France, Ukraine and Vietnam have all gained at the expense of the United States, he said.

Rosson said there might also be political and diplomatic reasons for the dramatic drop-off in Cuban exports from the United States.

He said it appeared that the Cubans were frustrated that their buying rice and other staples from the U.S. market – partly calculated to nudge farm-belt lawmakers to use their influence to change U.S. policy toward Cuba – had seemed to bear so little fruit, even after Obama was elected in 2008, until this new diplomatic opening.

Whether the resumption of diplomatic relations, and trips like that being undertaken by Abbott’s delegation, will change that remains to be seen.

Ernest Bezdek, director of trade development for the Port of Beaumont, making his fourth tip to Cuba, is depending on that.

Bezdek said that back in the 1950s, Cuba was Beaumont’s number one trading partner. He carried with him on this Cuba visit small sacks of Sunset Rice, from the Beaumont Rice Mills, to deliver to Cuban officials to remind them of the high quality Texas rice that Cubans, the most prodigious rice-eaters in the hemisphere, used to prefer before cheaper “broken” rice from Vietnam and elsewhere came to dominate the Cuban market.

The trip is sponsored and paid for by TexasOne, which was created by the Texas Economic Development Corp. to market and promote Texas. A contingent of Department of Public Safety officers, providing for the governor’s security, traveled at state expense.