American companies do business in Cuba?
Yes, but maybe not for much longer. One of the last remaining commercial agreements between a U.S. company and the Cuban government is reaching the end of its life. Marriott International's license to operate on the island will soon expire, and the Trump administration is making a point not to renew it. Reuters reported last week:
A company spokeswoman [at Marriott] said the U.S. Treasury Department had ordered the company to wind down its operation of the Four Points Sheraton in Havana by Aug. 31. It would also not be allowed to open other hotels it had been preparing to run. (full article)
Starwood Hotels, which was later acquired by Marriott, was a darling of the U.S.-Cuba relationship under President Obama. A global name in hospitality, Starwood signed three hotel management deals with the Cuban government in March 2016. At the time, The Washington Post optimistically placed Starwood on a path toward rapprochement:
Coinciding with the arrival of President Obama for his historic visit to Cuba, the Starwood agreements mark the further erosion of the U.S. trade embargo and a step toward normalizing relations between the two longtime foes.
The next day, Arne Sorenson, CEO of the hospitality company, wrote in a LinkedIn blog post:
This is a country poised for more opportunity. The entrepreneurial spirit—as Americans know it—is in a nascent stage in Cuba. The potential for economic growth – and therefore job creation – is tremendous.
Four years later, the picture isn't quite so rosy. Marriott is one of the many major U.S. companies that have either slowed or halted their work in Cuba. In 2016, the titans of the U.S. economy were clamoring to get in. In 2020, almost all of them are gone. The closure of Marriott is a win for the Trump administration, and an indication of how Trump will continue to approach Cuba if he wins the U.S. presidential election in November.
If Biden wins in November, however, many of these sanctions will be reversed. It's possible – even likely – that the U.S. will return to its Obama-era posture towards Cuba. Whether companies would seek to once again establish a presence in Cuba is unclear. I suspect many of them would be hesitant to jump back in, knowing that in four years more they could once again be kicked out under a different administration.
What's in the news
Strict social and political measures have helped Cuba get COVID-19 under control. Read last week's post to learn more about how they did it. Here are the impressive COVID-19 figures the government reported yesterday.
What I'm reading
Check out my reading list here.
Interested in visiting?
If you or your friends have any interest in joining me on a visit to Cuba in the future, I plan to lead an educational group to the island once travel becomes more accessible. It has been a privilege to run these trips at cost i.e., not for profit. If you're interested, shoot me an email.