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The time is right for open trade with Cuba

By Reece Langley
VP, Government Affairs
USA Rice Federation
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On Feb. 23, House Agriculture Commit-tee Chairman Collin Peterson (D-MN) introduced H.R. 4645, the Travel Restric-tion Reform and Export Enhancement Act.

The measure, co-sponsored by a bipartisan group of 38 lawmakers, would expand U.S. agricultural exports to Cuba by correcting the Office of Foreign Asset Control’s (OFAC) interpretation of the “payment in advance” rule for shipment of agricultural products to Cuba and permit direct payments from Cuban to U.S. financial institutions for U.S. agricultural exports. If passed into law, the legislation would also allow for general travel by Americans to Cuba.

With the 111th Congress at growing loggerheads over a vast array of issues from healthcare “reform” to the proposed “jobs” bill to stimulate the economy, passing Cuba trade and travel legislation would be an easy win for both political parties, U.S. rice producers and the nation.

Opportunities in Cuba
Cuba, located just 90 miles off the United States shore, currently imports its rice from Vietnam because of OFAC rules that stipulate that it must pay for agricultural goods in advance of shipment and that payments cannot be made from Cuban to U.S. banks.
The fact that any U.S. administration has the ability to change the rules on how Cuba purchases our agricultural and food products has meant Cuba must seek other suppliers to ensure a stable source of its imported food needs. This complication has hampered U.S. rice sales to Cuba. Should a more commercial trading relationship be established, Cuba has the potential to become a 400,000 to 600,000 metric ton market for U.S. rice if we can maintain a reasonable and consistent policy.

USA Rice goes the distance
The USA Rice Federation has worked for more than 15 years to remove agricultural trade barriers with Cuba. Top-level meetings between USA Rice leaders and officials with Cuba’s import agency, ALIMPORT, as well as its Ministry of Trade, have nurtured a positive business relationship – laying the groundwork for increased trade should current restrictions be lifted. In addition, USA Rice has worked collaboratively with agricultural coalitions to seek a legislative remedy to the OFAC rules that stymie U.S. rice trade with the island nation.

Increased trade with Cuba would not only benefit U.S. rice farmers but also would provide a much needed bright spot on the horizon of U.S. trade. With the United States facing an ever-widening trade gap, there’s still positive news on the agricultural trade front even in this economy. According to U.S. Department of Agriculture statistics, the fiscal year 2010 agricultural trade surplus is estimated at $22.5 billion, half a billion dollars lower than FY ’09, but still a huge surplus.

Should agricultural trade with Cuba open up, that surplus would no doubt increase, and the United States would be able to provide the rice that Cubans say they prefer to any other.

‘Perfect opportunity’ to boost the nation’s economy
If ever there were a time when this legislation could pass, it’s now. With broad bipartisan support from rice-state co-sponsors including Reps. Marion Berry (D-AR), Charles Boustany (R-LA), Travis Childers (D-MS), Jim Costa (D-CA), Chet Edwards (D-TX), Jo Ann Emerson (R-MO), Ron Paul (R-TX), Mike Ross (D-AR) and Vic Snyder (D-AR), expanding Cuba agricultural trade and travel could provide both parties with a political win and boost the U.S. agricultural economy.

Senate Agriculture Committee Chairman Blanche Lincoln (D-AR) has said that she believes the time is right to open the Cuba market.

During opening general session remarks at USA Rice’s Government Affairs Conference last month, Lincoln said, “It has been 50 years since we’ve had these restrictions in place, and I think we’ve accomplished all that we can during that period. Opening up the Cuba trade is the perfect opportunity to provide a boost to the nation’s economy.”

With broad-based support, enacting into law legislation that would expand agricultural trade and travel to Cuba might offer a glimmer of hope that the current stalemate in Washington over other many important issues can also be resolved with the same bipartisan spirit.

For more about USA rice programs, visit www.usarice.com.

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