On Resolution 70/5 of the United Nations General Assembly entitled “Necessity of ending the economic, commercial and financial blockade imposed by the United States of America against Cuba”
I. CONTINUED POLICY OF THE BLOCKADE. 4
1.1. Blockade Laws in Force. 4
1.2. President Barack Obama’s Executive Measures and their Limitations. 6
1.3. Prerogatives of the U.S. President to continue amending the application of the blockade without the necessity of going to Congress. 8
1.4. Principal Blockade Measures Applied after December 17 of 2014. 9
II. THE BLOCKADE VIOLATES THE RIGHTS OF THE CUBAN PEOPLE: REPERCUSSIONS ON THE MOST VULNERABLE SOCIAL SECTORS. 13
2.1. The Right to Health and Food. 13
2.2. The Right to Education, Sports and Culture. 16
2.3. The Right to Development 17
III. REPERCUSSIONS ON THE FOREIGN SECTOR OF THE CUBAN ECONOMY. 22
3.1. Foreign Commerce and Investments. 22
3.2. Finances. 26
IV. THE BLOCKADE VIOLATES INTERNATIONAL LAW. EXTRATERRITORIAL APPLICATIONS. 29
4.1. Repercussions for Cuban entities. 29
4.2. Repercussions for International Cooperation. 31
4.3. Other Extraterritorial Repercussions. 31
V. WORLD OPPOSITION TO THE BLOCKADE. 32
5.1. Opposition in the U.S. 32
5.2. Opposition by the International Community. 35
In the period between April of 2015 and April of 2016 some results have been achieved in the bilateral relations between the United States and Cuba. It can particularly be indicated the re-establishing of diplomatic relations and the re-opening of embassies that were preceded by the just action of taking Cuba off the spurious list of States sponsoring terrorism, a list on which Cuba should never have been in the first place.
In March of 2016, during his visit to Cuba, the President of the United States of America Barack Obama acknowledged once more that the “embargo” policy towards the Island is obsolete and must be eliminated. In his speech at the Gran Teatro de la Habana Alicia Alonso on March 22nd, President Obama stressed in reference to the “embargo” that it “only harms the Cuban people instead of helping them” and he again called on the U.S. Congress to put an end to this policy.
In spite of this, the economic, commercial and financial blockade against Cuba remains in force and the restrictions imposed by this policy continue being applied. During 2015 and 2016, the Departments of the Treasury and Commerce of the United States made several amendments to this policy’s regulations; which, even though they constitute positive steps, are not enough.
This report synthetically shows the repercussions resulting from the application of the blockade in the period mentioned in Paragraph 1 supra.
Despite the new scenario, on September 11th of 2015 President Obama again renewed sanctions against Cuba under the Trading with the Enemy Act of 1917 constituting the foundation for the laws and regulations that make up the blockade, alleging foreign policy interests.
This policy has continued to be toughened in its financial and extraterritorial dimensions. It can be seen in the imposition of million-dollar fines against banks and financial institutions for having relations with Cuba and in the persecution of Cuban international financial transactions.
Until the conclusion of writing this report, the announced authorization of the use of the dollar in Cuba’s international transactions has not materialized, nor the possibility for U.S. banks to provide loans to Cuban importers of authorized U.S. products. Nor has the trepidation of financial institutions or that of the very U.S. suppliers diminished due to the risk of being fined for having transactions with Cuba, a country submitted to sanctions from the United States.
The President of the United States possesses broad executive faculties that if he used them with determination would permit him to substantially dismantle the blockade policy even though its total elimination requires a decision by Congress.
The report being presented herein explains the limited scope of measures adopted by the U.S. Executive and the spectrum of actions that he could yet take to eliminate the blockade. Moreover, there have been grouped many examples of the economic and social repercussions caused by its application from April of 2015 to April of 2016. It is clearly demonstrated in the text how the blockade constitutes the greatest obstacle for the development of all the potential of the economy and the wellbeing of the Cuban people, as well as for the economic, commercial and financial relations of Cuba with the United States and the rest of the world.
The economic repercussions on the Cuban people due to the application of the economic, commercial and financial blockade of the United States against Cuba during the aforementioned period, and considering the depreciation of the dollar in regards to the price of gold on the international market amount to $753,688,000,000 in spite of the reduced price of gold as compared to the previous period. Since this policy began to be applied over 50 years ago, the blockade has caused damages for over $125,873,000,000 at current prices.
To be able to move forward in the process towards the normalization of bilateral relations with the United States, about which the government of Cuba has reiterated its willingness on the basis of sovereign equality, non-interference in internal affairs and absolute respect for its independence, undoubtedly this would require the unilateral and unconditional lifting by the government of the United States of the economic, commercial and financial blockade applied against Cuba.
It is essential that the 24 resolutions adopted by the international community in the United Nations General Assembly be respected; its Member States ask for that absurd policy to end.
The blockade against Cuba should never have existed and it must cease once and for all.
I. CONTINUED POLICY OF THE BLOCKADE
1.1. Blockade Laws in Force
In spite of the measures adopted by President Barack Obama since December 17th of 2014 and his repeated calls on Congress to lift the blockade, the laws and regulations supporting it continue to be in force and are being applied rigorously by U.S. government agencies, especially by the Departments of the Treasury and Commerce, and in particular by OFAC.
The principal laws of Congress and the administrative provisions that establish the blockade policy are:
Trading with the Enemy Act of 1917 (TWEA): Its Section 5 (b) delegated the possibility of applying economic sanctions on the Chief Executive in times of war or in any other time of national emergency and it prohibited trade with the enemy or allies of the enemy during wars. In 1977, the International Emergency Powers Act restricted the powers of the President to impose new sanctions in times of national emergencies. Nevertheless, TWEA continued to be applied to Cuba even when the White House had never declared a state of national emergency in regards to Cuba. Since then, successive U.S. Presidents have extended the application of TWEA on Cuba. Under this legislation, the oldest of its type, the US adopted the Cuban Assets Control Regulations (CACR) in 1963, by virtue of which US nationals or persons subject to US jurisdiction are prohibited from carrying out financial transactions with Cuba, Cuban assets were frozen, importing goods of Cuban origin to the US was prohibited, along with other restrictions. Cuba is the only country affected by this legislation. President Obama renewed the sanctions against Cuba for one more year through TWEA on September 11th of 2015.
Foreign Assistance Act (1961): This authorizes the President of the United States to establish and maintain a total “embargo” on trade with Cuba and prohibits the authorization of any aid to the Cuban government. It establishes that US government funds destined for international aid and sent to international organizations may not be used for any programs related to Cuba. It prohibits granting any aid foreseen under this act or any other benefit covered by any other law to Cuba until the President should determine that Cuba has carried out actions directed towards returning to US citizens and firms no less than 50 percent of the value or just compensation for the properties nationalized by the Cuban government after the triumph of the Revolution.
Presidential Proclamation 3447: Issued on February 3, 1962 by President John F. Kennedy, it decreed the total “embargo” of trade between the US and Cuba in compliance with Section 620 (a) of the Foreign Aid Act.
Control of Cuban Assets Regulations of the Department of the Treasury (1963): Stipulated the freezing of Cuban assets in the US, the prohibition on all financial and commercial transactions unless they should be approved by a permit, prohibition of Cuban exports to the US, prohibition on any natural or juridical person in the US or third countries from carrying out transactions in US dollars with Cuba, etc.
Export Administration Act (1979): Section 2401 (b) (1) “Control of National Security”, “Policy towards certain States”, established the Trade Control List in which the US President maintains a number of countries for which special export controls could be set up due to national security considerations. Cuba is included on this list.
Export Administration Regulations (EAR) 1979: Established the bases for general control of articles and activities subject to EAR control, in agreement with the sanctions imposed by the US government. They establish a general policy of denying exports and re-exportations to Cuba.
Cuban Democracy Act or the Torricelli Act (1992): Prohibits the subsidiaries of US firms in third countries from trading in goods with Cuba or Cuban nationals. It forbids third country ships landing in any Cuban port from entering any US territory for 180 days, other than those having a permit from the Secretary of the Treasury.
Cuban Liberty and Democratic Solidarity Act or the Helms-Burton Act (1996): Codified the provisions of the blockade, broadening its extraterritorial scope by imposing sanctions on executives of foreign enterprises that carry out transactions with nationalized U.S. properties in Cuba and threats of lawsuits in U.S. courts which has been object of an exemption, renewed year after year. Likewise it limited Presidential prerogatives for suspending this policy even though it establishes that he preserves his powers to authorize transactions with Cuba via the issuance of permits.
Section 211 of the Emergency Supplementary Appropriations Act for the 1999 fiscal year: Prohibits registering in the US any trademarks associated with nationalized products as well as the acknowledgement by US courts of the rights of Cuban firms on such trademarks.
Trade Sanctions Reform and Export Enhancement Act (2000): Authorized the export of agricultural products to Cuba on the condition of cash payments, in advance and without any US financing. It prohibited travel to Cuba by U.S. citizens for purposes of tourism, defining “tourism” as any activity related to travel to, from or inside Cuba that would not be expressly authorized in Section 515.560 of Title 31 of the Federal Regulations Code. In other words, it limited travel to the 12 categories authorized at the time this legislation was passed.
1.2. President Barack Obama’s Executive Measures and their Limitations
On December 17th of 2014 as part of his announcement on Cuba, President Barack Obama acknowledged the failure of the traditional U.S. policy towards Cuba and he promised to undertake a debate in Congress in order to lift the blockade. Corresponding to this new approach, the President announced several executive measures directed at modifying the application of some of the aspects of the blockade.
During 2015 and 2016, the Departments of the Treasury and Commerce realized several amendments to the regulations about Cuba which, although they represent positive steps, are insufficient. There are still significant obstacles for the implementation of these measures while the laws and application of the blockade policy and the numerous restrictions derived from it remain in force.
On the subject of travel, visits by U.S. citizens to Cuba under a general permit in the 12 categories permitted by law were authorized; re-establishing regular flights between Cuba and the United States was agreed to; the maritime transportation of passengers qualifying under the 12 categories was allowed and people-to-people educational trips for individuals were authorized. Nevertheless, the prohibition on U.S. citizens to travel freely to Cuba according to U.S. law persists.
In the area of telecommunications, they have authorized the export of products and services to Cuba, funding for the creation of infrastructure facilities and the possibility to set up joint enterprises with Cuban entities. Nonetheless, these measures have not been extended to other sectors of the Cuban economy which continue to be submitted to the iron-clad blockade restrictions.
In terms of trade and commerce, the list of U.S. products that as of the new measures may be exported to Cuba without needing to request the authorization of the U.S. Department of Commerce is reduced to only telecommunications products and services, construction materials and equipment and tools for use in the non-State sector of the economy, including agricultural activities. The sale to Cuba of other U.S. products and services is forbidden unless they should be authorized by the Department of Commerce via approved specific permits which expire in a certain length of time.
Furthermore, authorizations to import Cuban goods and services into the U.S. are limited to those produced by the non-State sector and exclude key items in the Cuban economy such as tobacco. By not considering the State sector of the economy, other Cuban goods and services having recognized international prestige such as rum, nickel, biotechnological products and medical and educational services are also left off the list. Along with that, tariffs that would be applicable to Cuban products, in the event that they would be able to enter US territory, would be the highest on the Harmonized Tariffs List of the U.S. International Trade Commission due to the fact that Cuba is situated at the most restrictive level of importation tithes to the U.S, and they do not possess most favored nation treatment, as a result of the blockade.
Likewise, changes to the maritime transportation regulations which allow ships participating in “humanitarian trade and commerce” with Cuba to enter U.S. ports prior to 180 days are not operational. It is quite improbable that ships moving commercial cargos to Cuba would limit themselves to transporting only foods, medicines, medical equipment or the other U.S.-authorized exports. International practice indicates that shipping contracts are not reduced to the transport of one single type of product.
In the financial area changes have been made in the application of the blockade by authorization for the use of the dollar in Cuba’s international transactions and the possibility for U.S. Banks to be able to provide loans to Cuban importers of authorized U.S. products. Nevertheless, these measures have not been able to be put into practice while the trepidation of financial institutions and of the U.S. suppliers themselves to undertake these types of transactions with Cuba persists, due to the risk represented by a country being submitted to U.S. sanctions.
Another important limitation is the prohibition on Cuban financial institutions of opening correspondent accounts in U.S. Banks; this restriction prevents establishing direct banking relations between the two countries and makes Cuba’s commercial operations with that country more expensive due to the necessity of triangulating them and paying commissions to intermediaries. The negative repercussions of strengthening the financial persecution of Cuban transactions and their marked extraterritorial nature during the last seven years continues to manifest in the continued refusal by banks in the United States and other countries to make transfers with Cuba, even in other currencies other than the U.S. dollar.
1.3. Prerogatives of the U.S. President to continue amending the application of the blockade without the necessity of going to Congress
The President of the United States has broad executive powers to continue modifying the application of the blockade regulations, including going further than he has to date, until it would be emptied of much of its content. Although the U.S. Congress is the body empowered to revoke the laws supporting the blockade policy against Cuba and to decree its demise, this act could be preceded by the dismantling of the imm