Reassessing Canada's Relationship with Cuba in an Era of Change

ABSTRACT

As 2009 draws to a close, Canada should be building on its relationship with Cuba. Cuba sits at an important crossroad as the country recently marked the first leadership change in almost 50 years. As the new president of Cuba, Raúl Castro has begun to institute a series of adjustments to Cuban domestic and foreign policies which could prove to be highly significant for Cuba and its relations abroad.  There is also potential for a transformation in US policy toward Cuba under the leadership of President Barack Obama. These changes will offer opportunities and challenges for Canadian policy toward the island. How Canada responds to these changes will have important implications for Cuba, for the bilateral relationship and for Canada’s relations in the Americas. The federal government should use their history of working with the Cubans to assist Cuba to adjust to its new realities, strengthen the bilateral relationship and improve Canada’s position in the region.


RÉSUMÉ

Le Canada devrait mettre à profit ses liens avec Cuba dès cette fin d’année 2009. Cuba se trouve en effet à un important carrefour par suite du premier changement de garde à la tête du pays en près d’un demi-siècle. Son nouveau président, Raúl Castro, a entrepris une série de modifications aux politiques intérieures et extérieures cubaines qui pourraient se révéler très significatives, aussi bien pour le pays que pour ses relations étrangères. On dénote de surcroît un potentiel d’évolution de la politique américaine à l’égard de Cuba depuis l’arrivée au pouvoir de Barack Obama. Ces changements sont riches de possibilités et de défis en ce qui a trait à la politique cubaine du Canada. Et la façon dont notre pays y réagira aura une grande incidence sur Cuba, sur les relations canado-cubaines et sur les liens de notre pays avec les Amériques. Le gouvernement canadien devrait miser sur l’historique de sa collaboration avec les Cubains pour aider Cuba à s’adapter à sa nouvelle réalité, renforcer les relations canado-cubaines et améliorer la position du Canada dans la région.


INTRODUCTION

'Viva el Primer Ministro Fidel Castro!' shouted Pierre Trudeau during his 1976 state visit to Cuba. This cheer to the crowd in Havana has become a symbol of the Canadian-Cuban relationship even though the bilateral relationship has experienced difficult periods as well as moments of closeness.  Cuba has held a special place in Canadian foreign policy in large part because for over 50 years Ottawa has maintained diplomatic ties with the Cuban government despite pressure from Washington to take a very different stance toward the island.  

Yet, as 2009 draws to a close, it is clear that the Department of Foreign Affairs and International Trade (DFAIT) needs to carefully consider Canada’s policy toward Cuba. In 2008, Fidel Castro resigned as president of Cuba, almost two years after he had temporarily transferred power to his brother Raúl Castro. As president of Cuba, Raúl Castro has begun to institute a series of incremental changes which could prove to be highly significant for Cuba and its relations abroad.  There is also potential for substantial change in US policy toward Cuba under the leadership of President Barack Obama who has initiated a process to reconsider policy toward the island state.

This preliminary paper will begin to evaluate these changes and their influence on Canadian-Cuban relations. These changes present both challenges and opportunities for Canadian policy. The challenge for the Canadian government is to navigate these shifting waters at this unique moment in time. Canada requires a coherent policy approach that is consistent with Canada’s priorities and role in the world.

THE CONTEXT

CUBA IN THE HEMISPHERE

Cuba is an important global actor, often playing leading roles in international organizations such as the Non-Aligned Movement and the Group of 77 and more recently as a member of the UN Human Rights Council. Cuba is also a major actor in the Americas, providing humanitarian aid and serving as an economic pillar in the region. Cuba’s GDP grew at an average of 6% during the first six years of this decade. Although Cuba is currently facing a serious economic crisis due to the global recession, its economic influence in the region is likely to be sustained over the long term.

Cuba’s stature among other states in the region is high, most significantly due to its willingness and ability to provide medical services largely free of charge to its neighbours. Medical personnel are sent abroad in large numbers. At any one time there are thousands of Cuban healthcare workers in other countries. For example, current estimates indicate that there are approximately 20,000 Cuban medical personnel in Venezuela alone.  The Cuban state also provides disaster relief worldwide. Cuba has fostered an international reputation as a state that other Latin American and Caribbean countries can rely on for leadership and assistance. This reputation has become an essential part of Cuba’s strategy in responding to American challenges and criticisms in international fora like the United Nations.

CHANGES IN CUBA

Since Fidel Castro stepped down as president of Cuba in 2008, Raúl Castro has initiated a series of changes on the island. He has lessened the restrictions on economic activity, including removing the limits on wages and allowing the reorganization of the agricultural sector. These and many other similar changes amount to serious internal reorganization, although still within the overall framework of the Revolution. Likewise, in the realm of foreign policy, Raúl Castro signed the two major international human rights declarations and has indicated he would like to begin a new era of US-Cuban relations. Cuba is at a critical juncture. This process of change will continue within the next decade as many of the old guard that formed the first generation of Cuba’s revolutionary government fade from the scene.


CHANGES IN THE US-CUBAN RELATIONSHIP

Many Cuba watchers believed that Barack Obama would overturn the embargo early in his administration. His early public remarks indicated he would work towards normalization, declaring in 2004 that “it is time for us to end the embargo.”(1)  As a presidential candidate, Obama stated that his administration would “grant Cuban-Americans unrestricted rights to visit family and send remittances to the island.”(2)  In the spring of 2009, he followed through on this promise, announcing that Americans with relatives in Cuba could visit Cuba without any restrictions and could also send as much money as they would like to family on the island. In July 2009, he reopened migration talks with the Cuban government that were suspended in 2003.(3)  Yet, the Obama administration has also said that the next major move is up to the Cubans and reiterates the traditional calls for change within Cuba.(4)  Thus, though the normalization of US-Cuban relations is likely it will probably evolve over the next few years, giving Ottawa time to craft a coherent policy toward Havana.


CANADIAN-CUBAN RELATIONS

Ottawa has maintained diplomatic ties and when possible, economic, educational and cultural connections with the Cuban government. Yet, this approach has provoked criticism from the United States.  During the height of the Cold War, Canada was only one of two countries in the hemisphere that refused to follow the American dictate to isolate Cuba.

Over the last 50 years, Canadians and Cubans have developed numerous connections. Canadians have been the largest group of tourists in Cuba for many years. In 2007, approximately 700,000 Canadians traveled to Cuba, accounting for 30% of all visitors to the island.  The bilateral relationship is further reinforced by extensive academic and business connections.

Ottawa’s approach toward Cuba is often attributed to the influence of economic interests on foreign policy. The lack of American competition in many areas (though no longer all) would certainly seem beneficial from the Canadian perspective. By the early 2000s, Canada was one of Cuba’s four largest trading partners, accounting for approximately 7% of Cuba’s overall trade.  

Canada also has considerable foreign investment in Cuba through joint venture arrangements with Cuban state firms. By 2000, there were 72 joint venture agreements between Canadian companies and the Cuban state.(5)  Canada’s largest investor in Cuba, Sherritt International, began this association in 1991 in the nickel mining industry but has since expanded widely with investments in Cuban tourism, transportation, communications, oil and gas ventures, among other industries with revenues totaling more than $900 million in 2006.(6)

Ottawa also provides a great deal of aid to Cuba with the aim of helping Cuba meet its developmental goals and to encourage Havana to adopt western democratic norms. Official Canadian development assistance was re-established in 1994, and between that year and 2006, the Canadian International Development Agency (CIDA) provided $85 million in Cuban development projects.(7)

Since 1959, the federal government has operated on the view that Canada should treat the revolutionary government as “normal”. Depending on the government of the day, this ranged from the closeness displayed in Trudeau’s early dealings with the island to benign neglect under Brian Mulroney. Under Jean Chrétien, the decision to treat Cuba as “normal” shifted slightly. Rather than simply engage Cuba as Canada did with other countries, we would now constructively engage with Cuba. The distinction reflected the Canadian government’s growing emphasis on fostering human rights and democracy abroad.(8) The goal of constructive engagement is to create linkages between Cubans and Canadians and their governments in order to influence the development of a different economic and political model in Cuba with an emphasis on fostering human rights and representative government.(9)  However, under former Liberal and Conservative governments, most controversial issues were discussed privately in an effort to maintain a relationship characterized by dialogue.(10)


THE CURRENT APPROACH

Many Cuba watchers predicted that relations between Canada and Cuba would become problematic after the Conservative party was voted into office.(11) Certainly, since 2006, the Canadian government has increased the rhetorical emphasis on human rights and democracy vis-à-vis Cuba. Maxime Bernier, Canada’s minister of foreign affairs, gave a nod toward the Bush policy on Cuba in May 2008 when he “congratulated” Cuba on their “independence day.” That date is not recognized in present day Cuba but celebrated by those who do not consider the 1959 Revolution legitimate. In this press release Bernier also referred to the “plight of political prisoners,” and encouraged “the Cuban people to pursue a process of political and economic reform.” (12)

Likewise, in 2009, Minister of State for the Americas Peter Kent ratcheted up the rhetoric, referring to Cuba as a “dictatorship, any way you package it.”(13)  In advance of his planned May 2009 visit to Havana, Kent announced that he would “stress again our encouragement of the release of political prisoners and the opening of institutions to democratic practices.”(14)  This rhetoric, more characteristic of statements emanating from Washington than Ottawa, was met with a chilly silence in Havana. The Cuban state then abruptly “postponed” Kent’s visit to the island. In response, Ottawa delayed issuing a visa for Cuba’s minister for trade and investment. Despite this rhetoric, overall relations continue to remain on solid footing with regular meetings and other lower-level diplomatic encounters proceeding as normal.  


POLICY OPPORTUNITIES

Canada’s history of engagement with Cuba has meant that we have long-term well-established relationships with powerbrokers and average Cubans alike. These relationships give Canadians an advantage whether normalization of US-Cuban relations develops in the short term or in the long term.  


POLITICS

Many see President Obama’s recent alterations to US policy toward Cuba as an opportunity for real change to this long-standing bilateral cold war. Some see an opportunity for Canada to play an important role in dissipating the tension between Washington and Havana. Although the Cubans have been clear that they would only negotiate directly with the Americans, Canada does have important access to and influence with high-level officials in both countries.(15) Canada has the potential to serve as a catalyst in the resolution of this long-term dispute.

For many years, Canadian policy has been based on the assumption that Canada can make a difference in Cuba via discussions about human rights or democracy. This research project will investigate the continued relevance of this approach. If the goal of constructive engagement is to promote changes in Cuba’s internal policy on human rights and democracy, it is clear that this policy has been unsuccessful. The Cuban system of government does not follow western standards of human rights and democratic norms regardless of the international pressure applied.  As much as it is unlikely that constructive engagement has done much to alter Cuba’s internal political structures, it is even more obvious that the approach favoured by Washington - attempting to overtly pressure the Cuban state to follow a different path – has met with failure.

The Cuban leadership has long argued that because it is on a war posture with the United States internal dissent must be controlled. Since dissidents are seen as traitors, American policy to publicly support the dissident movement has given credence to Havana’s accusations and inadvertently worsened the plight of those advocating for change.  Overt attempts to influence Cuba’s internal political structure or laws will have, if anything, a negative effect.


INTERNATIONAL POLITICS AND INFLUENCE IN THE HEMISPHERE

Ottawa has long strived to develop Canada’s reputation as a good international citizen and has successfully used Canada’s positive image to garner international influence. It is imperative that DFAIT builds on this image if they want to enhance Canada’s influence in the hemisphere.

Cuba’s stature in the region continues to grow. Cuba’s recent election to the UN Human Rights Council and the fact that its neighbours are more vocal in supporting Havana in international fora is evidence that Cuba’s strategy to improve its standing in the region via the provision of much needed medical assistance is paying off. The Canadian government’s new focus on improving Canada’s relationship with the countries of the region will only be enhanced by maintaining a positive relationship with Havana. Adopting a more interventionist policy toward Cuba might endanger the foundation of Canada’s international influence and renewed engagement in the Americas.

The current government should build on the mutual respect that is characteristic of the bulk of Canadian-Cuban interactions and has served us well historically. The Canadian-Cuban relationship has received much praise in Havana and is held up as a model to be emulated in Latin America. Commenting on Canada’s relationship with Cuba in May 2008, Cuba's first Deputy Foreign Minister Bruno Rodriguez Parrilla said: “If Canada could build their pattern of relations with the Latin American and Caribbean countries in the same styles, experiences, benchmarks as Canada does it with Cuba, in my view, would be excellent.”(16)


ECONOMICS

The future of Canadian-Cuban economic relations remains uncertain. The health of the global economy and Cuba’s ability to weather the current recession is an obvious factor that will help determine the shape of the economic relationship in the next few years. Cuba’s economy has felt the full effect of the international economic downturn as it came on the heels of a devastating hurricane season that already had Cuba struggling with billions in necessary repairs. As a result, Cuba is currently in the midst of the worst economic crisis since the end of the Soviet Union brought Cuba’s economy to its knees. This summer, Cubans have had to cope with widespread rationing of electricity and food shortages and have been told that further economic reorganization is on hold until the economy improves. Yet, economists predict that economic recovery is possible especially if Cuba is able to expand its exports. Given that Cuba improved its exports earnings in key sectors such as medical services and minerals since the end of the Cold War, it is likely Havana will be able to build earnings in these sectors as this particular global crisis comes to an end.

The evolution of the US embargo will be just as significant for Canadian-Cuban trade. Since Cuba has been permitted to purchase food on a cash sale basis from the United States, Canadian exports, especially in the agricultural sector, have faced more competition. In 2000, Cuba imported $408 million from Canada and nothing from the United States. In 2002, the United States permitted the sale of agricultural products to Cuba and Canadian exports fell to $325 million. By 2005, Canada ranked fifth in exports to Cuba, behind Venezuela, China, Spain and the US. From a Cuban perspective it makes economic sense to purchase from the United States given American products can often be bought and transported to Cuba at less cost.(17) In this case the Cubans will put profits ahead of any loyalty they might feel toward their Canadian business partners.  

Nevertheless, normalization of the US-Cuban relationship will not necessarily have an overall negative impact on Canadian trade with the island. Undoubtedly, the Cuban economy will strengthen considerably once the embargo is withdrawn leading to greater purchasing power. Given that Canada has a long-term economic history with the island, Cubans and Canadians are comfortable doing business with each other. In those industries in which Canadian companies remain competitive it is probable that Cubans will continue to do business with their Canadian counterparts. As Canada has already established a strong and competitive presence in a number of sectors it has a distinct advantage. Canadians are likely to remain competitive in the capital equipment market and as such should continue to supply Cuba with equipment related to the mineral, paper making, transportation, telecommunications and electrical generation industries.(18) Thus, under an improved economy Cuba will have the wherewithal to make more substantial purchases in these categories which will improve Canada’s exports in these areas. However, Canadian companies should be prepared to demonstrate their continued competitiveness and actively reinforce their existing business connections. Canadian policy makers should actively engage in trade promotion with an eye towards recognizing the key areas of opportunity and enabling Canadian participation and bilateral linkages in these sectors.

Normalization in US-Cuban relations is unlikely to destabilize the investment relationship as most Canadian companies in joint venture arrangements are quite prepared for US-Cuban normalization given that it would be improbable that a viable company would not have taken this eventuality into consideration prior to investing on the island. New investors will have to compete with American financiers for projects in Cuba, but given that the opportunities in the Cuban economy will likely balloon following normalization there should be many investment opportunities for Canadians.


CONCLUSIONS

Cuba is at a critical crossroad. How Canada responds to these challenges will have important implications for Cuba, for the bilateral relationship and for Canada’s relations in the Americas. This paper has argued that Ottawa needs to position Canada as a state that conducts its relations with Cuba much like it does with other states. The federal government should use their history of working with the Cubans to assist Cuba to adjust to its new realities, strengthen the bilateral relationship and improve Canada’s position in the region.

Canada can play an important role as Cuba faces new challenges in this era of change. Providing Cuba with support as it struggles with internal reorganization and crafts a new relationship with the United States will serve both Cuban and Canadian interests. Yet, in providing this support Canada should strive to avoid paternalism, recognizing that Canadians do not have all the answers for Cuba.

There are political and economic opportunities for Canada in maintaining good relations with the current government. As a key actor and a well-respected leader in the region, Cuba has influence in the Americas. Maintaining a solid relationship with Havana will facilitate Canada’s broader goals in the Americas. Likewise, we must take note that American policy is likely to shift toward normalization. In maintaining our good relations with Cuba, perhaps Canadian policy on Cuba will for the first time in half a century manage to be acceptable to both Havana and Washington. Anything we can do to bring the US-Cuban tension to an end will help Cubans who have been struggling under the embargo as well as remove the last vestige of the Cold War in the hemisphere.

Canada has an international reputation as a mediator and a state that works for international peace and stability. International respect from this role has helped Canada achieve many of its international goals and certainly helped our national interests. There is an opportunity to play a role in bringing this conflict to an end and Canada is uniquely positioned to do so.  The maintenance of Canadian engagement with Cuba and proactive trade promotion will allow Canadian companies to benefit whether normalization happens in the near or long term.  Reinforcing existing connections and finding new ways to engage with the island nation are the keys to keeping Canada in a strong position in Cuba and in building our relationships with the other countries of the Americas.

___________________________________________________________

Notes

1. Barack Obama, “Barack Obama on the Cuban Embargo, January 20, 2004,” Accessed July 14, 2009. http://www.youtube.com/watch?v=cZ3SVok9g34.
2. Barack Obama, “Editorial,” Miami Herald, August 22, 2007.
3. Lesley Clark, “U.S., Cuba to reopen talks on migration,” The Miami Herald, July 13, 2009.
4. Secretary of State Hillary Clinton explained, “We're continuing to explore ways to further democracy in Cuba and provide the Cuban people with more opportunities…” See Jacqueline Charles, “Hillary Clinton: Haiti, Cuba policies are under review,” Miami Herald, April 15, 2009.
5. Archibald R.M. Ritter, “Canadian-Cuban Economic Relations: Past, Present, and Prospective,” in Our Place in the Sun: Canada and Cuba in the Castro Era, eds. R. Wright   This is a preliminary directional paper that has yet to be peer reviewed or edited relative to style. It is published in this preliminary form to solicit both comment and debate as part of the research project.
6. Ibid.
7. Canadian International Development Agency, “Programming Framework Canadian Cooperation Program in Cuba,” Accessed August 14, 2009. http://www.acdi-cida.gc.ca/CIDAWEB/acdicida.nsf/En/NIC-223122217-NDJ.
8. Robert Wright, “’Northern Ice’: Jean Chrétien and the Failure of Constructive Engagement in Cuba,” in Our Place in the Sun: Canada and Cuba in the Castro Era, eds. R. Wright and L. Wylie (Toronto: University of Toronto Press, 2009), 195-222.
9. Canada Department of Foreign Affairs and International Trade, “Cuba: Canada-Cuba Relations,” Accessed August 14, 2009. http://www.dfait-maeci.gc.ca/latinamerica/cubarelations-en.asp.
10. Chrétien’s 1998 visit to Havana is the most well-known exception here.
11. In 2006, there was speculation that “Canada's historically friendly relationship with Cuba could see signs of stress as the Conservative government continues its pro-democracy foreign policy and the Communist country fosters closer links to countries like Iran and Venezuela.” Lee Berthiaume, “Cuba Saga Shows Signs of Complication in Ottawa,” Embassy, December 20th, 2006. Accessed July 30, 2008.
12. Mike Blanchfield, “Canada supports Cuban reforms despite U.S. jabs,” The Edmonton Journal, May 23, 2008.
13. Mike Blanchfield, “New minister sees a future for Canada in Cuba,” The Financial Post, January 6, 2009.
14. Mike Blanchfield, “Minister to make rare high-level visit to Cuba,” National Post, April 26, 2009.
15. A former British ambassador to Cuba told me that among the western diplomatic community in Havana the Canadians had the best access to Cuban officials during the 1980s and 1990s. He said Fidel Castro rarely made an appearance at significant ceremonies or special events at the British embassy, most often turning down invitations. However, he said Fidel Castro would regularly show up at minor events held at the Canadian embassy.
16. Lee Berthiaume, “Cuba Warns Canada: Follow U.S. at Own Peril,” Embassy, May 14, 2008. Accessed July 30, 2008.
17. American products are often preferred due to reduced transportation costs and the potential to access next-day delivery. It can take two weeks for Canadian products to reach Cuba.
18. Ritter, 246-281.