A $410 billion omnibus bill to fund most of the federal government for the 2009 fiscal year was finalized this week including controversial language regarding trade with Cuba.
Provisions in the omnibus allow for a general travel license for agriculture-related travel to Cuba; eliminate the current licensing requirements through the Treasury’s Office of Foreign Assets Control; and provide a fix to the current financing requirements that impede trade with Cuba by requiring payment before shipment.
While the adoption of this language is a significant victory on the road to easing trade and travel restrictions with Cuba, the excitement for the wheat industry and others was dampened by letters from Secretary of the Treasury Timothy Geithner indicating the new measures would have little impact.
In a letter to Sens. Robert Menendez (D-N.J.) and Bill Nelson (D-Fla.), who contacted Treasury with questions about the language, Geithner said, “Treasury believes that [the financing language] likely will have no influence on current financing rules,” noting the term “cash in advance” remains in the underlying bill, the Trade Sanctions Reform and Export Enhancement Act of 2000 (TSREEA).
In a separate letter regarding the travel provisions in the omnibus, Geithner wrote, “The regulations promulgated pursuant to that provision would provide that the representatives of only a narrow class of businesses would be eligible, under a new general license, to travel to Cuba to market and sell agricultural and medical goods.”
Despite these comments, the Geithner letter and other Obama Administration statements are clear that the Administration is still developing policy with regards to Cuba trade, and the wheat industry will continue to work with both Administration officials and Hill offices on this issue.
The wheat industry has long-supported legislative and administrative policy changes that would make it easier for agricultural exporters to sell wheat to Cuba. The Cuban market for wheat is approximately 33 million bushels.
In another trade development this week, the Senate Finance Committee approved the nomination of Ron Kirk, a former mayor of Dallas, to be the next U.S. Trade Representative. At his hearing, Kirk reiterated the Obama Administration’s intention to review pending free trade agreements.