The key to normalizing the relationship between the United States and Cuba

The Summit of the Americas held in Los Angeles It highlights the many changes that have occurred since the last time US President Joe Biden was in the White House. After January 2017, Venezuela became a failed state, and migrations from Central America caused political polarization in the United States. Brazil elected a tropical version of Donald Trump as president, and Mexico is a left-wing populist.

But one thing has not changed: the Cuban island remains a one-party state, a thorn in the side of US foreign policy and the promotion of democracy in the region. That is why the Biden administration decided to exclude her from the list of invitees to the summit (along with Venezuela and Nicaragua).

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However, the US government recently announced that it will rescind Trump-era sanctions against Cuba. In doing so, Biden begins to re-adopt a policy on Cuba similar to that of his former president, former President Barack Obama, who restored diplomatic relations with Cuba in 2015-2016, made an official visit to Havana, and eased some trade restrictions. and tourism imposed on the Americans with respect to the island. The idea was that a “positive relationship” would help promote economic and political change in Cuba and the region.

But the Obama administration’s efforts stalled even before Trump took office and rescinded all of his predecessor’s commitments. One issue remains problematic for Cuba: compensation claims for Americans whose property was confiscated during the Cuban Revolution. If the Biden administration can solve it, it will have turned a page on the entire region.

When Fidel Castro overthrew Fulgencio Batista in 1959, Cuba was mired in poverty and thieves’ rule. Batista had lined up in his pockets while most Cubans broke their backs on the sugar and tobacco plantations of the wealthy elites, or as service workers at the island’s seaside resorts. Part of Castro’s initial popular appeal rested on the radicalization of his strategy for bridging the huge gap between the rich and the poor: his rule was limited to expropriating property from the rich and redistributing the spoils to the poor.

But in this general campaign of expropriation and nationalization many American citizens and corporations have fallen. Hotel owners, landowners, sugar companies, and railway owners discovered overnight that their goods in Cuba had been confiscated, and that the best thing they could do was flee and save their lives.

Since then, about 6,000 US-certified lawsuits against the Cuban government have been filed with the US Foreign Claims Certification Commission, totaling $2 billion. In addition, the US Department of Justice received several thousand other complaints, not counting the thousands of Cubans who experienced seizures before fleeing to the United States and obtaining US citizenship.

In December 2015, the Obama administration persuaded the Cuban government to hold talks on the issue was a breakthrough. Havana has never recognized that requests for compensation are legitimate or worthy of discussion. But Cuba added a requirement of its own: Specifically, that the United States reimburse it for the enormous economic cost of its prolonged trade embargo on the island. According to Cuban calculations, losses range from one hundred thousand to 850 billion dollars.

For some experts and specialists, this summit is far from completely successful. Photo: Nodal.am.

Claims for compensation for confiscated property are not rare in international relations. In 1968, the American Petroleum International was expropriated by a military government in Peru, after a local scandal in which it was involved ended in a coup. The company claimed $120 million in damages, but the claim was not settled until Peru compensated other U.S. companies for property lost during the nationalization, allowing the U.S. government to step in and redirect some of the money on its way.

Then the same Peruvian government made massive expropriations of large estates (such as the one Castro did in Cuba) that affected more than 15,000 landowners and a total of about ten million hectares. The government promised to compensate them with public bonds, but a decade later they lost value amid uncontrolled inflation, and the government never paid them. To this day, a group of landowners is still trying to get compensation, and US hedge fund Gramercy Funds Management has bought thousands of auction-priced bonds from former landowners and sued the Peruvian government for $1.6 billion.

Past experiences suggest that for the détente between the Americans and Cuba to continue, it must be oriented toward the future. Fortunately, complex allegations and counterclaims can be used as the basis for a broader negotiated agreement aimed at normalizing bilateral relations.

One proposal is for Al Jazeera to settle small claims for monetary compensation and large claims for business development licenses. This may be part of a package to modernize and open up the Cuban economy, as the United States lifts sanctions and punitive regulations and accepts the island’s reintegration into major international financial institutions; In the process, these actions will do more than disarm the trade embargo.

But any decision must be tied to more recognition and protection of property rights within Cuba, as Mexico did before signing the North American Free Trade Agreement in 1992. When the Castro regime seized private property to pass on to the poor, the rights were reserved, so that beneficiaries did not get The right to own land and no power to alienate it.

Such restrictions are often imposed by authoritarian governments that redistribute property, which not only undermine investment and growth but also make recipients dependent on government programmes, which in turn are used to ensure their political loyalty. It was the model of political economy that Mexico had since the revolution, in the 2000s through the early 1990s.

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The Cuban government has already taken some initial steps towards reducing the state sector and liberalizing the use of real estate. While recognizing the rights of foreign plaintiffs, the property rights of those who have acquired the confiscated property must also be recognized. For example, farmers must have title to their land, along with the rights attached to it. Such a solution could be a new beginning not only for bilateral relations and the expropriated Americans, but also for Cuban citizens, who in turn could launch a new era of development on the island.

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