Van Hollen, Wyden, Lummis Call on Biden to Support Cuba Entrepreneurs and Small Businesses

Dear President Biden:

The U.S. embargo against Cuba has failed. It has neither facilitated regime change, nor advanced any notable improvements in human rights, democracy or economic freedom in Cuba. Instead, the embargo has limited the U.S. government’s ability to advocate for U.S. interests in Cuba, stifled opportunities for American businesses, farmers and ranchers, and hurt both Americans and Cubans in Cuba.

Small, private sector Cuban entrepreneurs have been clamoring for access to capital that could help their businesses thrive, support private sector employment, and make it less likely Cubans seek to migrate to the United States due to lack of hope for a better future. Rather than continue the failed policy of broad-based sanctions, your Administration should undertake efforts to increase economic exchange between the United States and the Cuban people. This should include risk-based, targeted efforts, including narrow changes to U.S. licensing and regulations, to support Cuba’s small and medium-sized private enterprises in accessing U.S. financial services to legitimate the Cuban private sector and facilitate its growth. Easing restrictions on trade and travel will also increase demand for U.S. commodities and make it easier for U.S. exporters to reach the Cuban market, benefiting American workers, farmers, ranchers, and businesses that comprise the thriving U.S. export sector. In addition, increased trade and investment from the United States will provide an important counterbalance to funds offered by China, which has shown an increasing interest in the island nation’s finances. As the Administration seeks to increase economic ties with Cuba’s private sector, however, it must exercise proper care and oversight to guard against money laundering or support of the Cuban regime.

We understand that the Administration supports changes to U.S.-Cuba policy, and we appreciate the steps the Administration has already taken to improve relations with Cuba. That said, the United States can, and should, do more. We urge you to swiftly take the following steps to ease restrictions on private-sector financing, trade, communication and travel with Cuba:

Support Small, Private-Sector Cuban Businesses by Providing Targeted Access to U.S. Financial Services

? Assess the extent to which the Cuban government controls banks in Cuba and explore a licensing framework allowing transactions between U.S. financial institutions and Cuban banks that have been determined to be civilian-managed;

?  Establish a targeted Office of Foreign Assets Control (OFAC) license to allow U.S. banks to provide financial services to small, private sector Cuban businesses, potentially through Cuban banks, with appropriate risk management controls to prevent the flow of funds to entities controlled by the Cuban government. The licensing regime should include both payments activity and microfinancing of the private sector in Cuba, including agricultural cooperatives;

?  Reinstate OFAC general licenses for U.S. financial institutions to process “U-turn” transactions—transactions between Cuban and non-U.S. persons that pass through the U.S. financial system;

Increase Trade in Food and Agricultural Products Between the U.S. and Cuba

?  Encourage the Cuban government to end its requirement that all imports from the United States be facilitated through a Cuba state entity. This requirement is not imposed on all of Cuba’s trading partners, creating a competitive disadvantage for U.S. farmers and ranchers relative to other exporting countries;

?  Foster further collaboration between the U.S. and Cuban agriculture sectors by improving and revitalizing existing Memoranda of Understanding between the U.S. Department of Agriculture (USDA) and Cuba’s Ministry of Agriculture;

? Work with stakeholders to encourage the use of USDA’s Market Access Program (MAP) and Foreign Market Development (FMD) Program funds, authorized by the 2018 Farm Bill, to educate U.S. farmers and ranchers and facilitate the export of U.S. agricultural commodities to the Cuban market;

Support Access to Information and Person-to-Person Contact in Cuba

?  Publish specific regulations and/or guidance to support internet access in Cuba, which would facilitate access to e-commerce and the free flow of information and communication across Cuba and between the U.S. and Cuba;

?  Publish guidance to allow U.S.-based firms to provide cloud-based services, fee-based platforms, e-commerce services and digital banking in Cuba, with appropriate risk management controls;

?  Reinstate OFAC general licenses for individual person-to-person educational travel; and

?  Reinstate OFAC general licenses for participation in, or organization of, public performances, clinics, workshops, athletic or nonathletic competitions, and exhibitions in Cuba.