Monday, March 12, 2007

Cuba's Debt (Part 1)

I plan to write in more depth later, but I wanted to highlight a few things about the current debate supporting the US embargo towards Cuba.

From what I have read most recently, there's one very popular argument that supports sanctions against Cuba: its huge foreign debt and its history of non-payment.

There is no question that Cuba's debt is colossal, "$12.210 billion by late 2002" according to the US State Department. But, such unprecedented debt hasn't stopped other nations from having diplomatic relations with Cuba, granting aid to Cuba, nor has it stopped other nations from trading with Cuba.

The most obvious example is US trade with Cuba after 2000, of which Cuba has become a major buyer of agricultural products, and must pay cash in advance (and other restrictions). There are also the joint ventures by European nations, and barter trades with South American nations. All of these examples are in the spirit of what Japan (Cuba's largest creditor with about $2.3 billion according to UM's Cuba Transition Project) has continued to do for over many years: have good economic relations with Cuba.

The reasons Japan sought such a relationship, despite the US sanctions, are complex, but have to do with their general stance after WWII: a commitment to peaceful relations and non-interference in foreign domestic problems with other nations.

Basically, its a position that many nations have undertaken with Cuba, with the hopes of positive results due to increased trade and diplomacy.

Japan, by 1989, was doing most of its trading with Cuba by barter or advance payment of cash or check. Today, there's no question that Cuba's debt to Japan is a huge obstacle to overcome, but Japan still has good relations with Cuba. Japan has not placed sanctions on Cuba, nor has it justified the US embargo because of this reason.

You have to ask yourself why Japan continues to have this policy with Cuba, and why do other nations have this relationship with Cuba. Its a sobering experience when you read about why other nations still have hope for Cuba, unlike here in the US.

[Part 2]

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