America To Normalize Relations With Cuba; What are the implications to Jamaica?

The Five decades long embargo against Cuba is still in place, it came about following the Cuban missile crisis in 1962. However, somewhat surprising news came last December; the US announced the initiation of steps to normalize relations with Cuba. The announcement is generally seen as a positive development, but apprehension is also perceptible, especially within the Caribbean region. I'll explore whether the fear of US-Cuba diplomatic normalization is justified.

Plaza Vieja, Havana. Source of Image: Brian Snelson on Flickr.

A myriad of changes were contained in President Obama's announcement regarding US-Cuba relations, the aim of these changes are to take a flexible approach to diplomacy, as was done with China. The changes include relaxation on US-Cuban travel, though a ban on direct tourism travel remains. Plus, an increase in the sum that can be remitted to Cuba. Additional changes in the flow of information and commerce are expected.

What are the implications to Jamaica

On the positive side, benefits of the move will not be immediate, similarly, negative implications are not expected in the short term. The biggest worry is Cuba being a threat to the regional tourism industry, to be specific, the tourism industry here in Jamaica.

But with an Embargo in place, and the continued ban on tourist travel, Jamaica will maintain Its presence as a major player in regional tourism. Plus, it is said that tourist visits Jamaica because of our culture and strong brand, a trend that is likely to continue. However, this threat should not be taken likely, I urge stakeholders to implement measures to improve competitiveness to limit possible fallout, knowing that removal of the embargo is inevitable. Additionally, the ministry of  tourism must increase airlift and diversify tourism offerings.

Cuba's tourism industry wouldn't be considered nascent. In fact, their room stock consists of approximately 30 000, with at estimated 3 million tourists. A breakdown of the figure indicates that Canada is their primary source market. With diplomatic normalization, a gradual increase in American travelers are expected. However, removal of the embargo should allow for an exponential growth in the aforementioned travelers, possibly at a lost their neighbours.

On the economic side, an increase in remittance will have a positive on Cuban spending. However, removal of the embargo should provide an astronomical boost to the Cuban economy. Namely in areas such as telecommunications, construction, manufacturing and tourism.

In such a situation, Cuba's regional neighbours may see a reduction in foreign direct investment. Despite the possible negatives, opportunities for Jamaican and Caribbean business would be numerous. Plus, with over 11 million people, Cuba would be the largest Caribbean market. In other words, with time, Cuba may become a major consumer of regional goods.

I implore on the Jamaican government, private sector and individuals to improve their competiveness; while awaiting US-Cuba normalization, and the inevitable removal of the 5 decades long embargo. Doing otherwise may be fatal, economically speaking. However, be it cliche, let's see what pans out with time.