A sister port agreement between Virginia and Mariel, as well as proposal by a Florida company to open a warehouse in Cuba, are among the latest efforts to stimulate trade between the U.S. and its long-embargoed Caribbean neighbor.
The Virginia Port Authority is scheduled Tuesday to sign a cooperation agreement with the recently opened Port of Mariel in Cuba, Gov. Terry McAuliffe said during a trade mission to the island nation, according to Reuters news service.
McAuliffe, who has worked diligently to enhance relations with Cuba since taking office in January 2014, is leading a 30-person delegation that includes representatives from Smithfield Foods, Perdue Agribusiness, T. Parker Host (a ship agency), Mountain Lumber Co, and Virginia Natural Beef, according to a press release about the three-day trip. Secretary of Agriculture and Forestry Todd Haymore, who has been instrumental in maintaining dialogue with Cuban officials in two administrations, is accompanying the governor, along with several other officials.
Officials originally hoped to schedule the trade mission last summer. The primary focus is on driving up Cuban imports of Virginia agricultural products, which officials have said could lead to good relationships that open doors for trade in other sectors.
Cuban officials want Mariel, located on the western outskirts of Havana, to become a transshipment hub for ocean carriers that can operate a hub-and-spoke operation to feed the East Coast of North and South America with smaller vessels.
Thomas Capozzi, the chief sales officer for the VPA, told Reuters the goal is for the Port of Virginia to become the preferred gateway for Cuban companies engaged in import or export activity.
U.S. firms are allowed under a 2000 law to sell agricultural commodities to Cuba because food is considered humanitarian assistance. Exports peaked at about $750 million, but fell to about $350 million in 2014. The value of shipments to Cuba fell about 18 percent in 2014, according to government data.
President Obama has moved to normalize relations with Cuba and relax part of the comprehensive trade embargo on the Communist nation, but full trade between the two countries will require Congress to lift a 50-year embargo.
The Commonwealth of Virginia is now the third leading exporter to Cuba among U.S. states, but export volume has fallen in recent years to about $25 million as Cuba has sourced goods from other states or countries. Over the past decade, Virginia agribusinesses have exported about $400 million worth of products to Cuba.
McAuliffe has tasked Virginia agencies to explore new commercial opportunities with Cuba in preparation for the embargo to be fully lifted.
“Like the Governor, I’m hopeful that Virginia agriculture and agribusiness will serve as a catalyst for more positive change and create new opportunities for other sectors of the Virginia economy, such as health care and technology, as the relationship between the U.S. and Cuba continues to evolve and improve,” Haymore said in a statement.
“Ending the embargo will create jobs here at home. From rural Virginia to our world-class ports, lifting these arcane trade and travel restrictions will create new employment and economic opportunities for Virginia companies,” added McAuliffe. “It will also open new opportunities for Cuban products to be imported to the United States. If we can do business with other countries from around the world, we ought to be able to freely conduct business with a country that’s our next door neighbor.”
In October, 2015, Governor McAuliffe was joined by eight other governors in a bi-partisan letter to the leaders of Congress calling for an end to the remaining trade and travel restrictions.
American Shipper has previously reported on the desire of Cuban and Virginia officials to establish ties between their ports.
Meanwhile, Florida Produce, a Tampa, Fla.-based company that has exported food to Cuba for years, is seeking permission from Cuban authorities to open a warehouse distribution facility to receive U.S. products, according to the Miami Herald.
The U.S. government in September issued new rules paving the way for logistics providers to set up shop in Cuba without a license.
Florida Produce officials said the company plans to stock the warehouse with food products, drinking water, beer, wine and liquor, telecommunications, building and construction materials – the categories of goods allowed to be shipped to Cuba under President Obama’s executive order a year ago.
Presently, it is still unclear whether the Cuban government will want the warehouse to operate as a joint venture.
Virginia to sign port agreement with Cuba
