THE Treasury Department on Tuesday (May 28) announced a series of regulatory changes to allow more US financial support for small private businesses in Cuba, bolster Internet-based services on the island and expand the Cuban people’s access to certain financial services.
The US will allow small entrepreneurs on the Communist-ruled island to open US bank accounts and also reinstates authorisation for so-called “U-turn transactions,” fund transfers that originate and terminate outside the US, the Treasury said in a statement, all steps towards helping Cuban entrepreneurs process payments and financing.
The measures would also allow Cuban entrepreneurs to use US-based online payment platforms, a major hurdle currently facing small businesses on the island.
“Today we’re taking an important step to support the expansion of free enterprise and the expansion of the entrepreneurial business sector in Cuba,” a senior US official told reporters on Tuesday (May 28).
The moves seek to fulfill the Biden administration’s long-delayed promise to ease restrictions to help Cuba’s budding entrepreneurs cope with fallout from the Communist-ruled island’s crippled economy.
In crafting the measures, US officials, who briefed reporters on condition of anonymity, said they struggled to balance that objective with a desire to avoid benefit to Cuban authorities.
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The new measures would exclude Cuban officials, military officers and other government “insiders,” with the aim of minimizing resources available from the benefits to the Cuban government, the officials said.
The Cuban government did not immediately respond to a request for comment on the policy changes.
Cuba has long blamed a US Cold War-era embargo – a tangled Web of US laws and regulations that complicate financial transactions by the Cuban government – for decades of economic crisis that have left it with little choice recently but to open its economy to small private business.
Such businesses – for decades taboo in Communist-run Cuba – are now booming on the island.
New laws put in place in 2021 have seen the establishment of upwards of 11,000 small businesses as of May, the government has said, ranging from corner grocers to plumbing, transportation and construction businesses.
Those businesses now employ 15 per cent of Cuban workers and accounted for around 14 per cent of GDP, according to economy ministry statistics from late 2023.
There was no sign that Tuesday’s announcement could foreshadow a more significant easing of US sanctions and other restrictions on Cuba, beyond the modest steps that Biden has already taken since coming to office in January 2021.
The US officials declined to say whether the administration was conducting a formal review of Cuba’s continuing presence on the State Department’s list of state sponsors of terrorism.
“Providing this support for Cuba’s private sector will help to stem irregular migration from the island by creating more economic opportunity on the island. It further allows Cubans to be self-sufficient without relying on their government for all of their daily necessities,” the officials said. REUTERS
