Friday, February 13, 2015

FAQs from the DOS "Cuentapropista List" (Update)

Goods (few) and Services (many) Eligible for Importation to the United States from Cuba's Nascent Private Enterprise Sector

The "Cuentapropista Importation List" itself (technically known as the U.S. Department of State Section 515.582 List), is currently more a "list of exceptions" to the list of importable goods than a list of permissions (see below). On the bright side, the list of "importable" services is much more open-ended. A helpful Fact Sheet is also available at the DOS site.

Here is my favorite Q&A from the FAQs sheet:
Q: Will the Cuban government allow independent entrepreneurs to export to the United States?

A: We cannot predict what the Cuban government will or will not allow, but we sincerely hope that it makes this and other new opportunities available to Cuba's nascent private sector. This is another measure intended to support the ability of the Cuban people to gain greater control over their own lives and determine their country's future.

Indeed, the ball is now in Raúl's court and we will see if he can take this preliminary "yes" for an answer.

Mimi Whitefield has a good write up on the new list at the Miami Herald: "New import rules for Cuba represent historic change." Despite the hopeful title of the article, Whitefield does not ignore the unfortunate, "underwhelming" caveat that this opening is riddled with exceptions:
"But forget the artisanal cigars, home brew or even refurbished vintage cars. Tobacco, spirits and machinery are among the exceptions not eligible for import under the new rules.  
"Prepared food and beverages, textile and textile articles and animal products also aren’t eligible for import, cutting out important potential sales opportunities for Cuba’s cuentapropistas, the self-employed. For the record, imports of live animals, vegetables, chemical and mineral products, electrical equipment, telecom parts, articles made from nickel, zinc, copper and other non-precious metals and mechanical appliances aren’t permitted either.  
"Items that aren’t on the list of exceptions may be imported."  
For me, the three big takeaways are:

1. The list is purposely a "negative" one meaning that instead of listing what is permitted in exhaustive detail (as the GOC does with its list of licensable self-employed occupations), the DOS only lists what the exceptions are - hoping that this approach sends a message to Cuban entrepreneurs that they should use their imaginations, be encouraged to be creative, and think outside the box.

2. However, a big problem is that all imports into the U.S. are subject to tariffs and those from Communist countries like Cuba even more so, plus there are tons of things that remain off limits as indicated in the quote from Whitefield's article above. This part is quite disheartening. Along with the fact that agriculture is more or less off the table (for now). American companies may advocate for the ability to sell their wares and foodstuffs to Cuba, but few are demanding the right of Cuban entrepreneurs to compete as sellers in the U.S. market.

3. There is much more space in this opening for "importable" Cuban services and even products produced by Cuba's new non-agricultural co-operatives (note the "entities" language in the list). Also, those returning from Cuba to the U.S. with goods can go beyond the previously established $400 limit as long a the other goods were acquired from the private sector (and under a $800 total since that's when steep tariffs would kick in).

So while important in making a historic crack in the wall of the U.S. embargo, challenging the Cuban government to respond by broadening and deepening its initial micro-enterprise reforms between 2010-2014, and facilitating some trade with Cuba's emergent private sector, this is still quite a small, symbolic step that will have little impact on the ground in Cuba in the short term.

This is due to (1) the Cuban government's continued monopoly over imports and exports and (2) the limited authority the Obama administration has vis-a-vis trade since much of the economic embargo (and tariff restrictions for imports) remain in place preventing full engagement with Cuba's emerging private sector.

One silver lining is that the DOS sees this as a "living document" that they expect to expand over time as they get feedback from Cuba's private sector.

1 comment:

  1. > We cannot predict what the Cuban government will or will not allow

    Thinking of what Cuba will allow -- "note that computer programmer" is on Cuba's list of job categories that are eligible for private employment: