Despite the trade embargo that largely exists for American companies looking to trade in and with Cuba, there are some opportunities still. Below a look at some of the basics involved with doing trade with Cuba (from an American business point of view).
The exportation of goods from the United States to Cuba is heavily restricted. The Cuban Assets Control Regulations is a law passed by the US government which dictates that no products,services, products or technology can be exported to Cuba, or indeed any Cuban national, from inside the US. This should not though put all American companies off from doing business with Cuba because they are many possibilities and these possibilities are increasing as we speak (make sure to read our article on the ‘Portfolio of Opportunities‘).
A law passed in the United States means that despite the embargo on US businesses, cash deals are acceptable when it comes to food and agricultural products. This is now such a large market that the USA is now the largest supplier of these products in Cuba. Livestock accounts for much of the trade between the two countries and this is an attractive prospect for those looking to set up an export company in the US, especially one which is based in the south of the country as this will reduce transport costs greatly.
Although the laws in the US technically only allow for food and agricultural products, it is now becoming increasingly common for other products to cross the border as it seems to be increasingly accepted provided that credit is not involved. Anybody wishing to export other goods to Cuba should seek the relevant legal and professional advice.
As an American business, can can also consider merging with companies in other countries and allowing those companies to deal with the exportation of goods to Cuba. Countries such as Canada, France and Mexico have good links with Cuba and therefore represent opportunities for investment.
Visiting the Cuban Trade and the US Department of Agriculture Foreign Agricultural Service website is one way to keep up with the latest news and regulations for doing trade with Cuba, if you are American, or an American business. We will though be discussing all of the trade options in our business section in the coming months – make sure to subscribe to our newsletter (see right side of this page) if you wish to get updates on Cuban business to your inbox!
Update: U.S. banks have now been given permission by the United States government, to operate in Cuba. This eliminates the need for those trading in and with Cuba and the U.S. to try and find an intermediary for this previously laborious and sometimes problematic step.