The Economics of the Changing Us-Cuba Relationship
President Obama’s current Cuba trip marks the first time a US president has visited the country in 88 years. The trip comes after more than a year of improving diplomatic relations.
Politically, the changing relationship between the US and Cuba is complicated and highly charged. 90.7’s economic analyst Hank Fishkind is focusing in on the financial implications and how Florida will be affected from an economic perspective.
- There has been and will continue to be very small economic impacts in the near term. Over the longer run, significant economic impacts on Cuba are inevitable, with small effects on Florida and the U.S.
- Cuba lacks the physical capacity and political will to enjoy larger economic impacts from the opening of relations, and the U.S. economic embargo of Cuba along with travel restrictions remain in place. These are large impediments and greatly restrict any potential economic impacts.
- It may be a number of years before any long-term effects manifest, because it is expected to be quite some time before the embargo is lifted, and until Cuba’s laws and regulations are sufficiently liberalized to support greater trade and travel. And after that, it will take a long time for investment to infuse sufficient capital into Cuba to improve its infrastructure to the point it can support more trade and tourism. Also, it will take a long time for investors and visitors to gain confidence that Cuba is a safe place to invest in and to visit.