Can we afford to lose $6.6 billion in revenue and 12k jobs?!

FOR IMMEDIATE RELEASE

Thurs., June 1, 2017

CONTACT: Madeleine Russak (626) 390-2158

ROLLING BACK CUBA POLICIES WOULD COST THE U.S. ECONOMY $6.6 BILLION AND AFFECT OVER 12,000 JOBS 

~ New economic impact analysis is released following reports that President Trump is set to to roll back President Obama's Cuba policies ~

WASHINGTON, D.C. -  Today, Engage Cuba led a coalition of business groups, economists and leading Cuba experts in releasing an economic impact analysis estimating that a reversal of Cuba policies would cost the U.S. economy $6.6 billion and affect 12,295 American jobs over the course of the first term of the Trump Administration. Obama Administration policies to loosen regulations on U.S. companies interested in doing business in Cuba have contributed to significant economic growth and job creation throughout the country.

The economic impact analysis was released on the heels of reports that the Trump Administration is set to roll back Obama-era Cuba policies, despite an ongoing inter-agency review that largely favors expanding travel to and trade with Cuba and concerns from U.S. military experts that reversing progress with Cuba would threaten U.S. national security interests. 

Rural communities across the country most reliant on agricultural, manufacturing, and shipping industries would be disproportionately affected by adding regulations on travel and trade to Cuba. This analysis excludes agricultural and medical exports because provisions allowing for limited exports in these sectors were authorized by Congress in 2001, thus predating Obama-era regulatory changes. However, new regulations on exporting agricultural commodities to Cuba could cost an additional $1.5 billion and affect 2,205 jobs more U.S. jobs.

Given their deep water ports and proximity to Cuba, imposing regulations on Cuba would particularly threaten economic growth and job creation in the Gulf states, including Florida, Louisiana, Texas, Alabama, Georgia and Mississippi, all of which supported President Trump in the 2016 election. 

"Our new relationship with Cuba has led to tangible results for American companies, created U.S. jobs, and strengthened Cuba's growing private sector. If President Trump rolled back our Cuba policy, he would add job-killing government regulations on U.S. businesses. This directly conflicts with President Trump's campaign promises of removing onerous regulations and red tape on U.S. businesses," said President of Engage Cuba, James Williams. "Reimposing restrictions on traveling to Cuba would force Americans to jump through even more bureaucratic hoops to exercise their right to travel freely."

"How sadly ironic and short-sighted it would be if, soon after singing the praises of the repressive leaders of Russia, Egypt, Turkey and Saudi Arabia, President Trump were to return to a failed 55-year-old policy of sanctions and ultimatums against tiny Cuba," said U.S. Senator Patrick Leahy (D-VT). "Rather than cave to the pressure of a dwindling minority who are stuck in the past, he should go to Cuba and speak directly with the Cuban people on behalf of the overwhelming majority of Americans who favor closer relations.  He would see that the current policy has given the Cuban people real hope for a better future, a future that is naturally linked to the United States and the American people."

"In the past two years since President Obama announced his policy of opening up to Cuba, we've seen economic exchanges, investments and jobs growth in the U.S. and in Cuba's private sector. For a jobs-focused President, to reverse these jobs creating reforms, especially one that affects many of the agricultural states that voted for him, makes little economic sense and no political sense," said Christpher Sabatini, a Latin America specialist and executive director of Global Americans. "Ending economic ties and killing U.S. jobs won't improve human rights in Cuba; continuing engagement and expanding those job opportunities--on both sides of the Florida Straits--will."

Dozens of U.S. businesses in almost every sector have begun exploring opportunities for expansion into Cuba. The four major U.S. telecommunications providers now offer roaming on the island, and Google will now allow fast and easy access to its online services.

U.S. travel to Cuba has skyrocketed. As a result, seven U.S. airlines fly direct to Cuba and three cruise lines have reached deals. American travel giants including AirBnb, Expedia and TripAdvisor now offer services in Cuba.

Since December 17, 2014, the Obama Administration issued six rounds of regulatory changes that eased travel and trade restrictions on Cuba. These policy changes have contributed to significant economic activity throughout the country, particularly in the U.S. travel, tourism and manufacturing industries. Additionally, as a result of diplomatic relations, the agreement between the U.S. and Cuba to end the policy known as "wet foot, dry foot," which granted permanent residency and federal benefits to Cubans who arrived by land to the U.S., will save U.S. taxpayers a significant amount of money and strengthen U.S. national security. 

Cost Summary:
Summaries of the major areas affected by potential rollback are listed below, totaling $6.6 billion and 12,295 jobs. 

• Travel: U.S. travel to Cuba was liberalized over the past few years by expanding legal travel in 12 categories, self-authorization, and allowing both airlines and cruise lines to offer passenger service to the island. Rolling back expanded travel could cost airlines and cruise lines $3.5 billion and affect 10,154 jobs in those industries.

• Manufacturing: Manufacturing companies in the energy, chemical, and technology industries are finalizing commercial contracts that will create $929 million worth of exports from the U.S. to Cuba over the next four years. Revoking authorization for manufacturing exports would deal a blow of nearly $1 billion to American businesses and could cost up to 1,359 jobs.

• Remittances: Estimates on U.S. remittances to Cuba show that Cubans working in the United States send up to $4 billion back to the island every year. Over four years, cutting the remittance flow could cost American money transfer companies $1.2 billion and affect 782 jobs. Additionally, the increase flow of remittances has significantly helped Cuba's growing private sector. 

• Immigration: In January 2017, the Obama Administration and Cuba reached a deal to end the controversial "wet foot, dry foot" policy, which granted permanent residency to Cuban immigrants who arrived in the U.S. by land. Because the policy granted refugees access to federal social and healthcare entitlements, reinstating it would cost U.S. taxpayers $953 million over four years.

*Estimates do not include agricultural exports, which would bring the total to $8.1 billion USD and 14,500 jobs. 

*All estimates represent an accumulated cost over the four years of President Trump's first term. 

The full report is available here. This economic impact analysis was prepared by Engage Cuba in collaboration with:   

American Society of Travel Agents

Tomas Bilbao, Avila Strategies

Center for Democracy in the Americas

Cuba Educational Travel

Richard Feinberg, Professor, University of California San Diego

Ted Henken, Associate Professor, Baruch College

Vicki Huddleston, Former U.S. Ambassador

William Leogrande, Professor, American University

National Foreign Trade Council

Pearl Seas Cruises

Philip Peters, President, Cuba Research Center

Chris Sabatini, Executive Director, Global Americans

United States-Cuba Business Council

Washington Office on Latin America

About Engage Cuba
Engage Cuba is the leading coalition of private companies and organizations working to end the travel and trade embargo on Cuba. As a 501(c)(4) bipartisan non-profit whose funds are entirely dedicated to advocacy efforts, Engage Cuba is the only organization whose focus is U.S.-Cuba legislative advocacy. Engage Cuba is also committed to supporting the Cuban people and helping organizations and businesses navigate Cuban and U.S. regulations. The organization has the largest bipartisan lobbying operation working on U.S.-Cuba policy. Together with the Engage Cuba Policy Council of renowned experts, Engage Cuba provides timely updates on opportunities for U.S. business in Cuba, regulations, and market analysis. To get involved with Engage Cuba's mission or learn more, visit: http://www.engagecuba.org.