The Cuba-Canada Conundrum

There is an interesting and mischievous OpEd in today’s Wall Street Journal about trade relations with Cuba. The piece argues that while trade can be a democratizing force, that still has not been the case in Cuba. Economic liberalization reached a peak in 1992-94, and has declined since. Nevertheless, trade continues apace with countries like Canada, largely in the form of tourism (it is the largest source of Cuba-bound tourists) and joint ventures.

“… at present there are more than 375 joint-ventures with foreign capital approved and working in the country. Some 52% of these come from the European Union, 19% from Canada and 18% from Latin America. There are more than 40 countries of origin, with Spain, Canada and Italy coming first, second and third. None of these companies would put up with these conditions in their own country, but current and potential profits make them look the other way.”

As the piece points out, Cuban workers don’t extract much benefit from their work in such joint ventures.

“Agencies of the Cuban government like Cubalse and Acorec provide the workers, who are then re-employed by the mixed companies. In these conditions, employees lack motivation and are disloyal. The system, however, is convenient for some foreign consciences as it takes the onus off of them for what is essentially modern slavery. That is because the state keeps around 95% of what the companies pay for these workers. The government pays these employees $10 to $30 per month and pockets the rest.”

Granted, the Wall Street Journal has long been on a jihad against Cuba, and U.S.-Cuba policy is a strange, inconsistent, and internally contradictory thing, but Cuba is being ignored again, and these trade issues could rear up and bite soon — especially if Cuba is ever (and almost certainly wrongly) linked with any of the malefactors who currently wish the U.S. ill.

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