With Cash And Fat Fryers, Americans Feed Cuba's Growing Free Market

With Cash And Fat Fryers, Americans Feed Cuba's Growing Free Market

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By Greg Allen

With more people traveling between Cuba and the U.S., money and goods

are moving, too. The influx has allowed Cuban-Americans to become

investors in the island's emerging private sector.

Tuesday, June 24, 2014



Every day, you can see signs of a subtle change in relations between

Cuba and the U.S. at Miami International Airport.



More Cubans than ever before are coming to the U.S. to visit, and the

number of Cuban-Americans traveling back to the island is also at record

levels. With all the visitors, money and goods are now traveling to the

island from the United States.



It's a legal loophole in the 50-year-old trade embargo — one that's

having a real impact on Cuba's economy, and allowing Cuban-Americans to

become investors in Cuba's emerging private sector.



'A Big Deal'



Shortly after taking office, President Obama made it possible for more

Americans than ever before to travel to Cuba. He began by lifting

restrictions on Cuban-Americans. Before the change, they could travel to

Cuba only once every three years.



Last year, Cuba's government made an even more unexpected move: It began

allowing its citizens to visit the U.S., with few restrictions.



Now, eight or nine regularly scheduled charter flights leave Miami daily

for Havana and other Cuban cities. At the airport, nearly everyone

waiting in line is carrying packages and large suitcases, even

flat-screen TVs and other appliances.



Ana Dilla was waiting in line recently with her two in-laws, who were

returning home to Cuba after a short visit. Their bags were full of

goods they purchased to take home.



"Hair items, clothing, shoes, hygiene items, makeup," Dilla says — all

items that are hard to get in Cuba.



Traveling from the U.S. to Cuba is still a hassle. There are

restrictions on the type of goods you can bring and how much. Over a

certain limit, and travelers pay a penalty. Cuba also assesses customs

duties on some goods.



But Dilla says the new freedom to travel has made a big difference to

her in-laws and others in Cuba.



"It was a big deal for them, absolutely," she says. "It was much easier

than in the past so it's a good thing. Things are getting a little bit

better."



Because of the changes in regulations in both countries, travel between

the U.S. and Cuba is at record levels — and growing. That includes

so-called people-to-people travel, trips that are organized by groups

for education or cultural exchange.



But by far, most of the travel to Cuba is by Cuban-Americans, and it's

having an important economic impact on the island.



"The presence of the Cuban-Americans is just undeniable," says Joe

Scarpaci, who heads the Center for the Study of Cuban Culture and the

Economy and has co-authored a book on Cuba's emerging consumer culture.



Perhaps even more important than their travel are the unrestricted

remittances Cuban-Americans can now send back to family on the island.

Scarpaci estimates that goods and cash sent by Cuban-Americans now is in

the range of $5 billion a year, making it the nation's second largest

source of income.



Using a Cuban slang term, he calls it, "Gusanos carrying gusanos."



"Gusano is the derogatory term that the folks of the island refer to

when the Cubans left the revolution — they crawled away from the glories

of the revolution. Now they're bringing back these duffel bags that are

long and shaped like worms, or gusanos," Scarpaci says.



The goods carried in those duffels aren't just clothing and cologne.

Deep-fat fryers, power saws, electric drills and soldering irons are in

great demand in Cuba. Scarpaci says he knows of many small businesses

there that have started up with goods and cash supplied by Cuban-Americans.



"From small restaurants to home body repairs to plastic-mold makers for

use of children's toys. In every one of those instances, the capital for

that has come from family members abroad," he says.



Free Market Activity



Nearly 600,000 U.S. travelers — mostly Cuban-Americans — visited Cuba

last year. Polls show a majority of Cuban-Americans now support

unrestricted travel to Cuba. A majority also believe Americans should be

allowed to invest in Cuban businesses.



There are some, though, who believe unrestricted family travel has led

to abuses. Mauricio Claver-Carone is the director of the U.S.-Cuba

Democracy PAC, a lobbying group in Washington that takes a hard line

against any move to weaken sanctions on Cuba. While he believes that

taking a trip back to Cuba once a year to see family qualifies as

humanitarian travel, he says others are gaming the system.



"People that are going back to Cuba more than once a year is not

humanitarian. They're essentially residing in Cuba. They have some type

of business practice that they've established by taking goods back and

forth. They're called mulas," he says.



The Miami-to-Cuba "mules" carry goods and cash, and, at least for some

Cuban-Americans, it's a legal end-run around the trade embargo.



"And essentially, they charge per pound or they charge per package,

things that they take to Cuba, so they've established a business

practice ... traveling to the island back and forth," Claver-Carone

says. "That is not the purpose of the regulations. That's a business

practice. And that should be illegal."



There are others though who say this is the kind of thing unrestricted

travel and remittances were intended to accomplish. By traveling

frequently to the island and helping — maybe even investing in —

businesses run by family members, Cuban-Americans are helping spur the

kind of free market activity long sought by the U.S.



Those who favor engagement between the U.S. and Cuba say the next steps

should include lifting all restrictions on travel to the island and

allowing U.S. visitors to use credit cards there.



Copyright 2014 NPR. To see more, visit http://www.npr.org/.



Source: With Cash And Fat Fryers, Americans Feed Cuba's Growing Free

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