Commentary: Open Cuba’s Market to U.S. Farmers

In this dramatically down market in U.S. agriculture, we should consider expanding the agricultural market into what is virtually our backyard: Cuba.

Less than 100 miles south of Florida, Cuba imports nearly 80 percent of its food from countries like Vietnam and New Zealand, including about 400,000 tons of rice. By being closer to Cuba geographically, the U.S. has the comparative advantage and could provide more affordable, better-quality goods in hours instead of weeks.

President Trump’s announcement may appease Cold War-era hawks and the minority of Cuban-Americans who still support the embargo, but the American business community—especially agriculture—need access to Cuba’s market.

There is a better way forward that satisfies both parties without repealing the embargo or changing its structure: Allow agricultural goods to be sold on credit through private financing.

Currently the U.S. trades agricultural goods with Cuba, but there are restrictions that limit trade to cash-only transactions. Considering that nearly all international trade relies on credit, this policy puts American farmers on the sidelines while competitors like Brazil and China enjoy Cuba’s $2.4 billion market.

Two bills under consideration right now—the Cuba Agricultural Exports Act in the House and the Agricultural Export Expansion Act in the Senate—would remove the credit restriction and allow private financing of agricultural exports.

President Trump’s secretary of agriculture, Sonny Perdue, expressed his support for trade on credit with Cuba during his Senate confirmation hearing in March.

Producers from Arkansas, Kansas, Louisiana, Minnesota, Texas and other states would be the first to benefit directly from this change.

If there ever was a time for this bill to move, it is now. Agriculture is a crucial part of rural states’ economies. The most important thing that can be done now for American farmers is to open new markets for U.S. products.

Allowing agricultural trade on credit would be a good compromise. Those who support the Cuba embargo should be able to get on board. The Trump administration would accomplish a bilateral trade deal that supplies the Cuban people with high-quality food. And all of this can be done while supporting rural American jobs—an undeniable victory for the Trump White House.

Source: Wall Street Journal