The irrelevance of Cuba

Patricio Navia

Buenos Aires Herald, March 9, 2015


In late 2014, US President Barack Obama’s decision to normalize relations with Cuba was greeted with satisfaction throughout Latin America. Unfortunately, US engagement with the government in Havana has resulted in few positive externalities elsewhere in the region. Latin American governments are too preoccupied with their own economic and corruption problems to take advantage of this opportunity. It is unfortunate that the solid economic growth in the US is not helping restore growth in the region.


When President Obama announced his intention to normalize relations with Cuba, the region’s countries rushed to celebrate the decision. For decades, the US embargo on Cuba damaged US-Latin American relations. Washington’s insistence on excluding Cuba from the Organization of American States (OAS), on the grounds that it was not a democracy, limited the OAS’s ability to promote democratic values and market-friendly policies elsewhere in the region. The US obsession with singling out authoritarian Cuba over its absence of democracy was justifiably criticized in some Latin American countries with left-wing leaders who were victims of human rights violations committed by dictatorships, supported by US governments, in the 1960s and 1970s.


Obama’s move to promote democratic and market-friendly values in a less adversarial way was also a gesture of goodwill to the rest of continent. By abandoning a failed policy, one that was widely unpopular in Latin America, the US extended an olive branch to the entire region.


The reasoning behind Obama’s decision related to domestic and international concerns in Washington. After losing the midterm elections, the Democratic leader needed to find issues that would help avoid him being branded a lame duck. The US president gambled that the Latino population in the US would overwhelmingly support his decision to normalize relations with Cuba.


For sure, many Cuban-US citizens would oppose the move. But Cuban-US citizens have historically been strongly Republican, so Obama would be infuriating people who would not even vote for the Democrats anyway. Since Cuban-US citizens constitute around five percent of all Latinos in the United States and support for hardline policies is declining even among Cuban-US citizens, Obama’s gamble entailed few risks. Easing sanctions on trade with Cuba and loosening travel restrictions will help to build bridges between US and Cuban-US citizens to those on the island. The Cuban government too, would suddenly lose a strong excuse to justify its mishandling of the economy. For the Obama administration, it was a win-win deal.


Washington also believed that the move to restore relations with Cuba would have positive consequences in Latin America. In recent years, as a result of the commodity boom, the continent’s countries have strengthened trade relations with China and the rest of Asia. The US is no longer the most important trade partner in the region. Obama’s move was intended to signal to the wider region that the US was ready to move into a new phase of multilateral relations with Latin America.


Obama indicated his intention to have the US Embassy in Cuba open before the Panama Summit of hemispheric leaders on April 11. As Cuban President Raúl Castro and President Obama will both attend the Panama Summit, restoring relations with Cuba looked to be a perfect message; an invitation to the rest of Latin America to strengthen ties with Washington.


The response has not lived up to the occasion. Corruption scandals in Brazil and Mexico (and to a lesser extent in Peru and Chile), upcoming presidential election in Argentina, the complications of the peace talks in Colombia and an economic crisis in Venezuela have shifted attention to domestic issues in the larger countries in the region. Governments consumed by domestic issues have little time to ponder international integration initiatives. Though most regional leaders will attend the Panama summit, they will have their eyes on domestic developments in their homelands. As a result of the end of the commodity boom and declining foreign investment, governments are being forced to scale back on social spending.


Now that governments are looking for ways out of the present economic distress, they should welcome the opportunity to engage with the United States. Robust economic growth in the US creates opportunities for Latin American exports. It is true that the easy flow of foreign investment from the US will slow as the US economy becomes more attractive for domestic investment, but Latin America should use its close proximity to the US to its advantage as competition for foreign investment increases in the coming months. Besides, expanding trade with a growing economy is always a good way to foster economic development at home.


Though normalizing relations with Cuba has always been demanded by Latin American governments, now that the US has finally moved in that direction, the region’s countries have failed to seize the opportunity to expand and deepen relations with the US. It’s as if Cuba was irrelevant after all — Latin American countries have let the opportunity to jump in and strengthen ties with the US pass them by. Given the bright economic outlook for the US and the sombre economic scenario in Latin America, that decision will do more harm to Latin America than to the United States.