BBC NEWS
April 14, 2004

Cuba signs $13m in US food deals

Cuba has signed contracts for food and farm goods with the United States worth over $13m (£7m).

About 300 US farming representatives are visiting Havana, hoping to make sales worth some $100m (£55m) during the three-day meeting.

The four-decade long trade embargo between the US and Cuba has an exception which allows commercial sales of American farm goods.

The meeting is organised by the Cuban government food import firm Alimport.

The biggest contract announced on Tuesday, the first day of the meeting, was for $8.9m (£4.9m) worth of corn with Archer Daniels Midland of Decatur, in Illinois.

Since 2000, when Cuba started to take advantage of the exceptional rule in the US trade embargo, farm product contracts worth $430m excluding costs have been signed, according to the US-Cuba Trade and Economic Council.

Wheat, corn and rice were the biggest imports from the US, with other contracts of intent signed for eggs, lumber and cattle.

Blockade

Food production in Cuba is facing difficult challenges and Fidel Castro is keen to import foodstuffs from the US, despite his concern about the possible import of US political influence.

Tourism is the country's main source of foreign currency, with foreign firms paying wages in dollars for each Cuban employee - although the government then passes on only a proportion of the pay in pesos.

Wages for Cuba's 11 million people now average about $15 a month from official jobs, a sum many supplement with unofficial work in the tourist business for hard cash.

US firms, however are banned from taking part in the tourist trade.

Aside from the loophole for farming imports, US law bans its companies from trading with Cuba or investing in the island state under American economic trade sanctions, imposed in 1962 to isolate the government of Fidel Castro after he began accepting Soviet aid.

But after four decades, many observers believe that ending the embargo would bring a flood of American business and tourists and weaken Castro's ideological grip on the country.