Senator Hewitt visits Cuba
The announcement one year ago by President Barack Obama that the United States was re-establishing diplomatic ties with Cuba brought hope to many American businessmen about new opportunities in the nearby country.
But an educational trip taken to Cuba last month by 100 Louisiana business and political leaders, including La. Sen. Sharon Hewitt (R-Sli.), makes it clear those economic opportunities are still far off.
Hewitt, the first year senator from District 1, said the six-day trip to Cuba was interesting, eye-opening and fascinating for many reasons. But she also learned something that most Americans are probably not aware of that is hindering U.S. businesses from finding new opportunities in the small island near Florida.
Hewitt said there is a strong contingency of Cuban-Americans, many based in Florida who settled in the United States after fleeing Cuba, who believe the U.S. should not do any business with that country until restitution is paid to the many Cubans who left everything they had to escape the Fidel Castro regime there.
“Many of the Cuban-Americans who are leading the call for restitution are now congressmen and state representatives from Florida,” Hewitt said. “It’s a very serious issue and one that Congress does not appear ready to take on.
“Until that issue is addressed in some way, it will be hard to start doing much business with Cuba, even though it is clear there are tremendous opportunities there for American businesses,” she explained.
The biggest roadblock to doing business with Cuba, Hewitt said, is that there are several laws Congress put in place years ago that are hindering business taking place.
Most prominent among those laws is one that says no United States business or lending institution can give credit to Cuban businesses.
In today’s business world it is almost universally accepted that a seller gives credit to a buyer in most transactions, even if only for less than 30 days.
“As long as that law is in place it means the only business Cuba can do with the United States businesses is by having cash,” Hewitt said. “And Cuba is cash poor, so that is a big problem.”
After Hewitt returned from the Cuba trip on July 17 she met with U.S. Rep. Steve Scalise from Louisiana to discuss the situation, but she said “he made it clear there is no sense of urgency to change the law.”
Hewitt, along with her husband Stan, were among 100 business people and public officials who made the trip to Cuba on July 12-17, a trip that is only allowed if it is deemed “educational.” While Obama made big news in July, 2015 when he announced it was time to re-establish ties with Cuba, all that happened is each country re-opened their embassies. No other changes occurred in laws or business opportunities.
Hewitt said she does appreciate the feelings of Cuban-Americans who expect restitution to completely restore relations with that country. But she also said that the U.S. bombed Japan in World War II and many years later, re-established relations and trade with that country.
“Time certainly will change the feelings about that,” Hewitt said.
Meanwhile, she said the business opportunities are great in Cuba since the country currently imports 80 percent of their food and consumes five times the amount of rice every day that Americans do. The U.S. has a surplus of rice they could easily sell to Cuba for a lower price than the current exports all the way from Vietnam.
Hewitt, who has a professional background in the oil and gas industry, said she also saw a great opportunity in that area for the United States, but hopes there is a way to still do business with Cuba even with the cash and credit obstacles.
“Cuba only produces 46 percent of the energy they need,” she said. “They are trying to reduce their energy consumption by 20 percent and while we were there we saw that as we experienced rolling blackouts. We also saw gas stations closed because they don’t have any fuel to sell.”
Hewitt said she met with the leadership of the Cuba Oil Company and learned about an arrangement they are utilizing with other companies to drill for oil on the island. She said Cuba owns the oil leases to drill, but a U.S. company could bring in their money, technology and cash to drill. The first oil reserves that are obtained will repay the American company for their investment, then after that, all oil and gas is split between Cuba and the American company, thereby avoiding the need to have cash to purchase U.S. oil.
“They are using this deal with other companies and I think it can work for American companies,” Hewitt said.
She is scheduled to attend the Louisiana Oil & Gas fall meetings in September and will bring the proposal to oil and gas executives at that time.
Hewitt also said there are many agriculture and construction opportunities in the country.
On a personal note, the senator said she was amazed at the lack of progress in Cuba since it is a Socialist country where the government basically owns everything.
“All the cars you see are from the 1950s and construction is almost non-existent. We were told that three buildings a day, on average, collapse due to disrepair since the government owns everything and nothing gets fixed. Nothing new gets built, there are no recognizable stores and people have to rent from the government to have their house,” she said.
Hewitt said the effects of a Socialist government, which means the people rely on the government for everything, were very clear.
“People are given health care, rationed food, get free education and whatever else they need, so there is no incentive to go to work,” she said. “Able-bodied men are seen standing around everywhere.”
She said they were told families were rationed one chicken leg and one thigh a month and had to stand in long lines to buy a gallon of milk for a nickel.
“But the amazing thing is that the people don’t know what they don’t know,” she said. “They don’t understand about a Democratic society and that things could be different. And that’s why Castro doesn’t want Americans coming there because then the people will learn it can be better.”
Hewitt said that one tour the group was given took them to a 25-acre farm, considered one of the biggest in Cuba. An American farmer offered to give a new tractor to the men working the fields since they plowed it all with two ox.
“But the man said it would have to go to the government to decide if they could have it,” she said. “It was truly amazing to see what a world it was.”
Hewitt said she will respect the feelings of the Cuban-Americans in their pitch for restitution and seek ways to bring business to Cuba from American businesses in other ways.
SOURCE: The Slidell Independent - by Kevin Chiri