trade council program from the ways and means and finance committee that is friday february 13. now today i will leave it to john veroneau to introduce our panel. a long time friend and onetime board member. and co-chair the international trade practice he worked in the department of defense in the '90s with then secretary:and senator collins and senator frist if i have that right. thanks for doing this. take it away. >> they explored the year and i will introduce the panel here in a moment but i want to open with a few remarks. the title is the falling of

u.s. cuba relations and wonder how much of the ideas heard the word thought i'd never thought it would be a good place to be. [laughter] but we're glad you are here. but it is consistent with the other cuba related events but over the years cuba has captures the imagination i remember back when we were trying to get support for the west colombia free trade agreement that enjoys a lot of support from clocks on this panel with columbia represented the generating interest now in that was limited compared to cuba which seems to capture the imagination and. is not on the politics of the u.s. cuba relations we

don't have time to go through the long history but it is an emotional issue. there are families to have the property confiscated whose families were attended and have strong views with the current government in cuba but today we will focus on the president's announcement and what the perspectives are from the legal and business community i want to mention in that category of great timing six months ago to come out with a steady called economic normalization and with cuba for u.s. policymakers. similar to that focus is not a polemic it was a workman

approach in the peterson is a cheery generally that these are the things that policymakers need to think about the end tectonic plates move and it is the serious discussion about normalization and i would commend it on the web site of america trade policy.com in the first chapter is online but it is a very thoughtful piece in what i appreciate is that the campeau usually fall into the free trade or the protectionist with the work

product case said the implicit message is open the market with another country is the good thing that we should approach it with caution in in a measured way and the analogy is russia and with all due respect that is the economy that is not is open as a lot of us hoped it would be at this point of time and when we talk about opening markets with other countries those of us in the free trade camp think will these be open to us to have the oligarchic system in russia that it

discusses says something to avoid so we don't lose the leverage of the u.s. market without having some strategy to be sure it will be open and not sliced up the way was seen in russia. and to conclude that this is not because such an income -- outcome is in the bad interest of companies but the cuban people themselves because economic freedom is the source of there long-term welfare. with that we will turn over to our panel. i will introduce them in the order we are seats it but then i will mixup.

to my immediate left is a vice president of corporate affairs at cargill. she has been in that position since 2004 and before that was of a colleague of mine where she handled agricultural issues it is also the president of the agriculture coalition in in cuba and is active in this space. to her left is jake colvin from the foreign trade council. in addition to being active in many trade issues he has been particularly active in cuba to publish of paper a road map for the obama administration to reach cuba.

and to his left is robert muse who is a lawyer in washington and has represented many clients and has a long history that has testified before congress to have an active participant in policy lies with regard to cuba and to his left is john kavulich senior policy advisor for the u.s. cuba trade and economic council for a place served as his president in making it an from buffalo today has been very active for three decades now on policy matters and we welcome him and others on the panel today. each will provide remarks 45 through seven minutes then we will have time for

questions. we will start with robert who will do this scene setter on december 17th to folks in this room are savvy enough to know the president did not announce the end of the embargo most picked up the newspapers on december december 18 but it is more complicated that robert will lay out for us. >> faq. in the thank you for coming. the title of this event is the falling of u.s. cuba relations it what does that mean for trade? the short answer is it means

as much as obama or any successor wants it to be. the executive branch authority by the nature of the announcement december 17 for a license to trade with cuba, of bilateral removing all export controls on those that want to export to cuba, he has already done it on december 70 the rules are drafted as we speak in terms of imports to about $400 worth of goods to come to the u.s.. he can do that notwithstanding that prohibit imports of products though the executive branch authority of course, being

drafted into a final rule allows imports from cuba. exports is the least five different areas glen is used in residential construction and consumer goods are not defined yet to be used by q been entreprenuers that basically means goods that could be sold in cuba in john could remind me there is to those of u.s. trademarks and goods can now be sold in cuba. he also allowed for farm equipment to be sold to small farms in cuba for gore at the same time he licensed certain television sales and financial services with the use of credit cards.

my essentials point is the announcement of december 17 summarizes and confirms what i and others have been arguing for years the presidential authority in relation to trade with cuba is unfettered. you will hear some comments with the act of 1996 codified the embargo is therefore limited presidential discretion in this area. it is not true. win the embargo was codified it was in place with presidential discretion and authority exercise december december 17th for i have written extensively on this at various times is there is an article in the fall edition of america is quarterly that sets up the

legal basis for what i just said. i want to leave as much time as possible for questions so i will end by saying from what have described the residential sales of materials, take that as a model for u.s. business. at the moment there are agricultural sales one of the few areas that it is allowed. cuba insists they are by instrumentality i suspect that will be true with u.s. exports to cuba initially whether building materials or farm equipment or consumer goods. but i can see over time that will expand so the trade

with cuba should think early on about warehousing and distribution:facilities in cuba and it is recently renovated on the north coast think of the opportunities of expanding the small opening into corporate access into cuba. i believe president obama means it to be a legacy issued in they will go tentatively in april. i don't think she is going to unless there is a larger initiative under way at this point so obama once of legacy issue in the foreign policy issue so i expect to see a substantial expansion and broadening of the small

opening with u.s. corporate sector the first real opportunity since the embargo was imposed 55 years ago. thank you. >> it is great to see you here this morning for about as interesting and we had to expand the room because of the interest. . .

and before i go any further i would like to give you the hashtag hashtag pound cuba at a trade if you are at all interested in reporting out. but the usa cc many people in fact i was speaking with jake a few minutes before and he said wow you pull that together in two days and it was amazing. actually the u.s. agency has been working for eight months to get ourselves organized around the charter and i will go through exactly what it is that we have committed to as a group. though why eight months ago? we is in a growth of one of the trips that i took to cuba last

march basically on a sales call we have been able to sell through humanitarian channels since the year 2000. our first sale or a company with a march 2002 but i was on a sales call and recognize how difficult it was to actually sell food to cuba. fast-forward to me our cfo and i traveled with the delegation with a u.s. chamber of commerce to cuba led by tom donohue to assess the business climate. the cuban government has implemented a new foreign investment law that many folks may or may not know about and at the same time has put laws in place to begin allowing for people, individual people to become part of the private sector. the cuban government is transitioning many individuals off of the government payroll and recognizing the need to empower the president.

while we were there we met with most branches of the cuban government. they were able to visit cooperatives. we were able to meet with entrepreneurs and the first americans to visit the port that has been funded by the brazilians for $800 million. we visited a committee investment in energy and we feel like we got a broad-based understanding what's going on in the human economy. pointblank the rest of the world as they are. they are beginning to be there more significantly and the american community is not there. so what is the usa pc and what a week claiming to do to shift the narrative here in washington and drive change? first of all we have come together to liberalize the trade between the cuban economy and the primary purpose of ending the embargo. i do understand there have been discussions around how far the president can go and we

certainly welcome the announcement on december 17 but in our conversations with the administration we know full well that even on the financing side the executive order will only take us so far. quite frankly we are hamstrung by her ability to use u.s. financing with cuba so we very much need the embargo is a necessary step in allowing us to have meaningful trade. we are reenergized to establish cuba as a market for u.s. agricultural products and currently there are 11 million students then it's a natural market. 90 miles off of our coast. certainly none of us are in could say that cuba is at the top of the list in terms of markets for their company but what they can say is that makes absolutely no sense that if we have a partner close to our folks whereas the national market we should not be denied

an opportunity to trade with them. as our coalition we have four goals. we are going to advance a constructive dialogue in washington on u.s. cuba relations. we are going to actively engaged to end the long-standing embargo. we are going to work with key stakeholders to drive momentum towards historical change in 2015 and we are going to take public platform to explain the imperative of trade liberalization with cuba. i'll give you a few statistics because even though we have been able to sell to cuba since 2002 and we saw this in a agriculture community through 2008 u.s. agricultural sales have declined significantly since then. where it reached $700 million in sales in 2008 we are around $450 million in sales now. u.s. rise, cuba used to be the largest export market.

u.s. rice is no longer exported to cuba and let me restate that. u.s. rice indicates cuba was its largest export market. that may come as a surprise two. the soy industry they say cubans use a lot of soy oil and it's also a necessary and put into animal feed. 99% of the cooking done by cubans is using soy oil. while in 2002 to 2012 the soy growers have about a 70% market share that decline to 40% in one year. we have been making zero sales and to cuba at the moment. they're estimating that to be a 250 million-dollar loss and they believe the cubans are paying three times the price for transporting agricultural products to cuba. this is about the affordability of fear -- food in the cuban market.

cubans are spending too much money on financing food and transport of food. bottom line they are spending too much money on food. at the end of the day the brazilians the vietnamese argentinians are all using our market and it's an unnecessary for them to do that. and again while we think it's a market -- margaret marcus i would like to express to us is not a single trade flow of u.s. commodities going south. why do we believe there needs to be an absolute normalization of relations? this is about the broader american business community being able to take the chance to advance sales of goods and services and capital capital into the market. we believe through the broader development economic development in the cuban market will gain but not only that the 11 million citizens of cuba again.

those are 11 million citizens who have been under a policy experiment for 54 to 55 years. it's a failed policy experiment in what i can say is if you are a farmer and you plant the seed the same way in year one and you tried again the same way in year two and then after 55 years who are still doing the same thing but that seed is not germinated them popped up and taken advantage of photosynthesis and ground wouldn't you think about doing something differently? that is what is upon us is changing the status quo. there is a negative narrative out there. our coalition last week had a broad subset of bipartisan support. this is a bipartisan issue. we have senator jerry moran from kansas and senator klobuchar for minnesota. we have a democrat from

california. we have rodney davis republican from illinois and kevin cramer republican from north dakota. the secretary of agriculture which i believe is the first cabinet member since the embargo to stand up for the embargo was their governor nixon from missouri who agreed to work on a bipartisan basis to build other support from republican and democratic governors across the nation. so it's a bipartisan issue issue. one thing we do remember is that cuba are offering benefits to the other wto members and we are simply not in the game. we will require normalization. we believe it's not only a majority of congress is on our side but we also know the majority of the american people are on our side. so at this point what we can say is that we certainly recognize the history the difficulties and the emotion and the pain of the

past but what we know as the u.s. agriculture coalition for cuba is that we can collectively on the future. that is what we can own. i would submit to the business groups in the room today that often get steered down the course of moderation on this policy or it's too tricky to talk about actually join us, stand up and recognize we have a lot of things on our plate from transpacific partnerships to ttip but we can't lose sight. why wait one more day? why wait until 2015? why wait for another president? we welcome conversations with the u.s. and coalition on cuba and i'm hoping for questions. thank you. >> thank you devry. jake we will turn to next. >> thank you john and thanks for putting this on. for those of you who don't know

we are a business association based in washington d.c. at one of the things we have done since 1997 as we have run a coalition called usa engage which opposes sanctions and promotes the idea of u.s. engagement in the world. as the u.s. engages where a complement to what devry is doing on agricultural site. you have done a lot in a short period of time it's really impressive. i think devry has done a good job of laying out the case for normalization so i would be remiss if i didn't say we support that but rather than saying the same thing that devry just said about why normalization is good and important and should happen now i thought i would focus on a few other things. the first is the importance of announcement made by president obama to the business community and also some longer-term challenges aside from the sanctions to reestablishing trade investment ties between the united states and cuba. on the announcement it's just

really good news. this is a fundamental change in u.s. cuba policy. wasn't half measures are couched in rhetoric. what it does is it flips the debate upside down so this is the first time since 2000 when congress was passing the trade sanctions reform act where we have a policy of engagement that opponents have to respond to. the other thing that does is it sends a signal to the business committee that it's okay to express interest and explore cuba. i think there will be a lot of curiosity from business community. it's been off the market for so so long long city with a lot of interest in exploring the situation on the ground. i think that the administration's announcement will do what the president's announcement will do will enable that curiosity and enable businesses to start exploring cuba. i'm going to go through a couple of provisions that have been announced so far that i think are of particular importance to

the business committee. the first is establishing licenses for travel. the fact the treasury will license travel will significantly expand the ability of americans to go to cuba and for businesses and entrepreneurs to get a feel for the cuban market. the second thing is enabling credit card processing relationships. this is good for americans who want to go on the ground want to go to cuba and use a credit card but it's also good seeking payment for goods. it will protect international property and trademarks. the third provision that's important for u.s. businesses as permitting u.s. owned entities to engage in financial transactions with cubans that are located in third countries. this has been a gigantic point particularly for u.s. banks who would have to deny accounts to cuban nationals living in the country like spain. so i think there is also those

provisions seem clear to me that they will be enacted in a couple of weeks in rules that treasury will put out but i think there are other areas that presence announcement and the white house where we need to wait to see what's going to happen. the first is what will the extent of enabling services be? travel service providers will be allowed to provide service to the u.s. travelers going to cuba cuba. will ups be able to deliver up packages john tavares enqueue back? i don't think that's clear yet and there are some references that are a bit vague and the fact sheet. one is exploring additional options for promoting the growth of entrepreneurship in the private sector so that may or may not come in an initial tranche of regulations. my read of the presence authority is similar to bob's which is he can use as licensing authority abroad so one thing i've been suggesting is

important united states products made by cuban entrepreneurs so you can license ebay and engage cubans on their platforms to sell things into the united states. i'm not sure that's going to be part of the initial tranche of regulations that does seem like the sort of thing that would be consistent with the presence announcement. so that's the short term. i think the longer-term the enthusiasm and a the curiosity that exist now is going to be tempered by the stated u.s. policy in and the fact that sanctions exist and are out there but also by the reality on the ground in cuba. the limiting factors that sanctions will present until there's a full normalization of relations with the long-term opportunity depends on more than an end to sanctions. for businesses shutting off sanctions is not like turning off the spigot to foreign investment. trade investment will occur even when sanctions are totally gone

and will be affected by first and foremost the economic element in cuba so to the extent cuba can purchase things from abroad and support investments on the ground in cuba trade investment will expand. the second thing is that lower like on policies to the cuban government. if you're looking at trading with cuba you will care about customs facilities transparency and doing business ability and willingness to protect copyrights. cuba doesn't always score high on all those metrics in part because they're ambivalent about the relationship with the local economy. they want a trickle and not a flood of foreign investment trade and they are wary of being too dependent on the united states. i think all of that is changing and there's a new vibrancy and cuba. raul castro is trying to engage

internationally so we will see where that goes but it do think these will be limiting factors even when sanctions go away so i will stop there. >> thank you jake. john kinney around us out here? >> i will turn out to be redundant and i apologize for my voice. a little laryngitis. i think many people listened and saw and read what the president announced and heard, saw and read what they wanted. they didn't necessarily listen to what he said or how he said it nor did they listen to the cuban response. if you look at the optics president obama wore a dark suit stood at a podium spoke for 15 minutes am what if he wanted to do to the cuban people for the cuban people and with the cuban people. president castro spoke for three minutes sitting at a table

wearing a military uniform. they still feel they are under attack and many of them still feel there are war wounds. cuba is only going to permit what it believes it can control. it's not a criticism, just a fact. one of the challenges is missing the belief that somehow cuba is due by 90 miles south of key west florida and archipelago at 11.3 million people that has so much money flowing and waiting for the currents to push it north. cuba develops its trade relationships not solely based on cost but also on politics. again not a criticism.

countries do that throughout the world. to give you a little history from 1980 to 1992 cargill engaged in trade with cuba by $5 billion worth. 1946 libertad allows for private settlements to the u.s. companies. it reauthorizes putin had fails. there have been little health care product sales in cuba since 1992. while in large measure is because cuba would rather have a political issue than health care products for its people. in addition products are expensive in the united states. and they can get products from other places and get it with financing. some years ago come to work out

an agreement with the catholic church and the agreement was that they would be able to provide for the third-party verification. part of cbs's health care products will be used in tourism etc.. they said they would be willing to do that. from the business community standpoint we thought that was a slam dunk. took away an issue that had been disrupting exports at the same time it was able to solve a problem. the cuban foreign ministry went went -- and they said basically you have just destroyed our ability to use that as an issue. i'm not saying they always want to do that but it's a component that needs to be thought of here. from december 2001 through november of last year u.s. exports totaled about $5 billion

$5 billion, just a shade under $5 billion that's in cash and the payment terms have been cash in advance as cicero requires. the cubans balked after fizz for a was signed into law or they didn't buy anything for a year and the u.s. business community and add groups and others basically said we worked all this time and now they are saying you won't buy anything because you can't get financing. we will focus on other countries and then in december of 2001 they came back after the hurricane and said we are going to make a one-off purchase just want just to replenish products that were damaged and the hurricane. they did not buy wood for a couple of years but they began the process and over that time there have been changes. the bush administration actually

relaxed the payment terms. and then later in its administration because of abuses with travel to cuba they went back and they reversed it. president obama is reversing it again. my point is that when folks want to focus on everything that we want to do down there cuba also has to make some changes and cuba hasn't had to make a lot of changes changes because they're up in countries that have been willing to support it. currently venezuela so i would argue there right now the u.s. relationship with cuba is far less meaningful to cuba then is cuba's relationship with venezuela. venezuela has issues and they have already decreased slightly they're subsidized oil exports to cuba. that's going to create an impetus for cuba to make changes that it does not want to make. it could result in a special

period in cuba which took place after the ussr change its relationship. so there's a lot going on that you need to review. financing is one of them. you have heard some discussions about that. cuba didn't stop buying from united states because it couldn't get financing in 20. as a matter fact u.s. companies when it was being negotiated push some of the ag groups to support financing in the business community and exporter said nau because cuba has horrible credit and we don't want to be standing in line with everyone else trying to get her money so i counsel present was able to go-round the world and say cuba is the safest export market in the world with u.s. companies than it is. cuba has never been below 50th out of 223 export markets

globally in the united states. that's impressive for a small country on a cash basis. those that are arguing the embargo needs to be listed legislatively a think or make a mistake because so much can be done through the executive branch and financing cuba has been more focusing on reestablishing relationships with existing training partners commercially and politically. china russia iran mexico spain brazil and those countries in many cases have government operated entities. cuba buys rice. they generally buy rice from vietnam which are state run entities so why did they do that because vietnam gives them one, two and three years to pay for rice and when they go into default very many people know about it and they would refer --

or for that way. it's what they want us to do down there and what they can afford to have us do down there. it was amazing after president obama's remarks we saw the same after fidel castro stepped down that people were running to see if they could get on a plane and go down there. they have a long way to go but from our perspective, from united states perspective it's best to move slowly because focusing back on where we were in 1959 when it comes to cuba don't focus on anything five years back because that's basically what your reality is going to be. your reality is going to be changing yearly so looking way back to evaluate what may be in the future i don't think we

should spend a lot of time doing that. more importantly is to look at what cuba is and look at it realistically. 11.2 million people with a small economy and with the government that has horrible credit. the most important from a business perspective right now you do have a triangle. cargo sent something to cuba and the cubans will use a bank in another country and send it to the u.s.. direct correspondent banking so that can take a day or two. direct correspondent banking that money goes to chicago within several hours and is more efficient and less expensive but here's the challenge. some years ago that was an idea that the bush was considering

and counsel and some of the companies went down to the cubans and said this is something that would certainly be helpful in the cubans said here is a challenge. your government still wants to change us and we understand there are federal laws and the laws and regulations put into place after 9/11 that requires any foreign bank that wants to do business with the u.s. bank to open its books to make sure they are not money laundering so the cubans said at that point how is this beneficial to us to open our books to the government that wants basically to put us out of business? so this time around it's going to be interesting to see if the cubans look at this differently or if there are ways around it. direct correspondent banking is very important. now we can go to questions. >> thank you john. we are now going to move to q&a.

we have a microphone that we are going to pass around and wait for that microphone to arrive to you and when you pose your question if you could introduce yourself, your name and your affiliation we would appreciate it and others in the room would appreciate it. if you can keep your questions brief. if you want to direct them to a critic -- particular panel as you can do so but if you wanted just to be a jumble for the panel that's fine too. >> and i just interject? i wanted to make a couple of clarifying points here because john mentioned those working on the embargo might be making mistakes before you draft your question. moving slowly would be quite painful for the cuban people. not only that, that the provide certainty we need. quite frankly it seems as americans we are tying one hand

behind their backs as we see investors landing in cuba were places in the european union from brazil and other places across the globe. and i do want to put some context around at least in our conversations with cuban officials at the moment what they see in terms of u.s. sanctions if it's actually crippling their ability not only to get fti but but other fti. they need about $2 million here. in our conversations with the trade minister who goes out to other countries to bring in investment he has indicated that their history as one of having to be dependent on one country whether it's united states whether as russia and as our colleague mentioned venezuela. quite frankly they don't want to be dependent on one country which is why they want the sanctions to end.

they need $2 billion to keep their economy going so there's an imperative there. i would also take issue with the fact that cuba is venezuela's most important relationship. quite frankly cuba sees cuba linking with the globe is its most important relationship. i don't think we should be focusing on what people wore on december 17 but on what people said in the fact that the government engages with the 18 month dialogue when the u.s. business community met with a president in havana he wore a business suit. >> thank you devry. questions? right in front here. >> good morning. doug from capital group. the board mentality that you describe which i agree with. i just spent 10 days in cuba last week.

i agree with that sounds. does that live fond beyond role and fidel castro or does that die when they go? >> i think we would all like it to as quickly as possible but there are a lot of generations that have been born under it and know only it so i think the process will not be swift and i don't necessarily think that we want to be swift. i don't think we want a hilton style transition that would put ussr to rush at the beginning. no one knows. there is a lot of love and hate.

cubans have one of the highest awareness is of u.s. brands in the world and one of the highest preferences in the world so if u.s. companies launching into cuba comes with less cost than some other marketplace that makes it attractive so and that's because the folks do have, the people of cuba many of them have access. we saw what no one expected with fidel. most people, most of the modeling done in the u.s. government was fidel's speaking, he drops dead worries in his office and people drop dead and people know where they don't know but no one expected a succession and then a transition from brother to brother. i would say don't expect raul dies and it's a switch. it's going to be more of a wave. >> thank you. >> bill lane.

>> good morning. bill lane with caterpillar and first of all i want to thank you for a great program and great timing particularly the fact that this is two days away from the big anniversary. some of the folks here may recall that on january 16, 1998, 17 years ago u.s. engaged in coalition officially took the american business community over the line calling for a new policy toward cuba took out full-page ads in "the wall street journal" and felt that was the time to move forward great since then there has been a cicada like policy for 17 years. so to say we have to move slow as a whole different frame of reference when it comes to cuba. here is my question. they seem to be moving with a fair amount of vigor and they have stayed engaged during that

entire 17 year period. the business community as related to industrial and consumer goods has not and usa engaged and ftc the trade missions planned and the congress department is going down in april. the council of the americas meeting or some of the americas and come on and april as well. what is planned and the one thing about what american business gets excited about a market every other business community around the world gets excited about the same market. my question is are we going to move with vigor or are we going to take a cicada type approach and have a different type of policy? jake i guess the question is to you and what have you got

planned? >> well thank you bill. that was a great commercial for usa engage. i did encourage that at all so that was on his own. i thank you. first of all interests in the business the broader business community has ebbed and flowed according to what they think is possible so you saw a huge blip of interest in 2009 after president obama was elected and when chairman berman was trying to move forward a repeal to the travel ban. at that point they usa engage had a meeting and it was like this room here. a lot of interest and enthusiasm because there was the potential for something significant to happen. everyone woke up. we were on the hill a lot but when that faded and it didn't come to pass everyone went into hibernation again. so you are seeing it at right now -- you are seeing a flow right now because of the

announcements. what i think is important is for the regulations to come out for cuba to be re-examined in terms of its role for congress to take up this question on the hill. you have a positive momentum that enables businesses to continue to engage in to explore explore. we are going to start doing that. we have been talking to the commerce department. i don't know if i can talk about your trade mission. do you want to talk about your trade mission mission? the agricultural committee has something planned for me, excuse me, marge. there will be interest. you will see a drumbeat of support and talking to her colleagues and the chamber of commerce making sure there is part of this and committee support moving forward with the administration on the hill. >> could i say something? a couple of times it's been said this morning go slow. i'm not sure what that means.

it seems to be an attempt to contrast legislation lifting the embargo on the hill with regulatory activity. the president the executive branch can go much further much faster than congress is going to go on lifting the embargo. there is zero possibility the embargo is going to be lifted. it's not going to happen. not one of these bills is going to come out of committee let alone reach the floor. so to the extent i feel it's almost an implication being made that those of us who favor regulatory action by the president and i hypothesized that legacy project here great presidential discussion to pursue it but i think we are getting pushed off into the side channels but talking about lifting the embargo on

capitol hill right now. >> help me because i'm an optimist and i believe optimism keeps us going on the right path. why won't the bill come out of committee? >> i leave it to the room to judge whether bill is going to come out of the republican-controlled house and the senate. >> robert let me follow up on that. my reading of the tea leaves is your conclusion that congress is at two views some strongly in favor of lifting, some strongly opposed to what the president steps has taken and if you had to bet i think i would bet where you have placed her money which is unlikely there will be legislative action on this to the world that what the president is doing more to advance the policy further. my question to you though is your initial remarks you suggest you're reading a burden as a legal matter is that the

president has full legal discretion to lift the embargo to take expansive steps. my question is do you think that politically than congress would not act if the president next month or at some point in his tenure took steps far beyond what he has already announced? >> i think there's a contradiction within congress. the majority of members of the house and senate don't privately support the embargo. they haven't for some years. but that doesn't mean they are going to affirmatively support legislation to lift the embargo. as far as legislative interference with anything president obama may do in terms of cuba i think it unlikely. i think it's also for presidential candidates jeb bush

and marco rubio ebo said they support the embargo. i don't know that that's the most attractive position to take into a presidential campaign. i noticed both christie and paul were slow to react to what the president did and when they did paul endorsed it and christie said essentially nothing. so this tension between america as a forward-looking country america that promotes trade globally existing congress and i think that wealth prevent direct interference within a presidential initiative on congress but i think the simple reality including pacs funding on capitol hill makes the long-term project. by no means do i want to disparage those to lift the embargo. i think they are a necessary conversation in overtime i think it's going to happen.

and i don't want to go on into greater length but if the president can forage ahead using the historical prerogatives of the presidency to establish some kind of bilateral trade with cuba you can then see the embargo as a tidying up of operations on capitol hill. not a frontal assault but a recognition of an existing reality that the embargo is more holes than she's at that point then i think a repeal becomes a much easier thing to accomplish. >> thank you. a question over there and then we are going to move back here. we are scheduled to go until 10:30 so hopefully we can get to a lot of questions out there but i think we are on track to get to all of them. >> thank you very much and i agree with bill, great panel and good to hear your perspectives.

>> my question for the panel is a little bit of historical perspective so as i listen to the debate on executive versus legislation that you do it i wonder if anyone has any perspective up there of comparing it to when the trade ended with vietnam and the missteps there and whether that informs your different perspectives on how to move forward with cuba or is it just too different because of the legislation that controls in this case? thank you. >> others may have views but one perspective on that was when we normalized in vietnam there was a fairly protracted negotiation in terms of what trade would be how explore it -- expropriation claim to be sorted out so vietnam was not a member of the

wto. cuba obviously is so was not a complete apples-to-apples comparison. what i do think vietnam and other instances suggest that there would be a multipronged negotiation and an agreement of different issues to be sorted out including of course claims. >> said to john's point in 1995 as women normalize relations and that's when cargo set up our first sales office and get him and then we had the permit trade relations in 2005. estimate of that one across the finish line. we can strictly draw parallels between what happened there and what we think will happen in cuba and that is that we went in with zero investment and now if you fast-forward to where we are today cargill has a very robust

animal feed business. the import u.s. products into the vietnamese market and over that course of time we have through investments and through working in those communities we have actually built our 70th school on the ground in vietnam. what we can say is not only the power of trade but u.s. investment and the ability of businesses to engage in what is known as commercial diplomacy. in the case of cuba cuba is artier wto member. women normalize relations would have to ensure that we would gain the same that the wto members have we would also have to have the pntr is part of that as well. >> i would say two things about vietnam on the hill that make it different from cuba. one is it was not an active embargo vietnamese lobby on my cuba.

secondly the senators that on the issue of vietnam mccain and kerry brought an emotional dimension to their desire for a -- with vietnam. it works the other way on capitol hill. the cuban-american legislators bring hearts and minds to the embargo. that tends to be deferred to somewhat by their colleagues on the hill. there are many dynamics that make vietnam and cuba sufficiently different. john makes a good point that we can have ex-appropriation claims will be similar but the dynamic on capitol hill is different. >> over here please. >> i have a question on specifics. do you all have any idea on licensing policy changes like in

the nitty-gritty like the aviation industry? we have got issues with de minimus content. a plane in europe. the spanish carrier happens to be a plane going in and out of cuba that becomes a problem for boeing or airbus if it has a u.s. engine etc. etc.. with that is changing with the high-level policy how soon could we expect perhaps licenses granted or changes in the regulations on the specific issues? >> the administration has announced they expect opec to promulgate new rags in the next few weeks. time will tell but i think that as a general matter we are going to see a loosening of the sanctions. >> i think congress will release regulations in the next week or two or three.

i think what will happen as a result of the policy changes for example licensing travel instead of requiring specific licenses for several of the categories the travel to cuba. that will free up resources so even if you still do require a license you are going to have more resources rather than focusing on things like specific daily licensing travel. >> than when the cba was signed into law in 1982 which reauthorized health care exports to cuba there was nothing in the law is that individuals could make sales calls to cuba that you could take product to cuba as samples. all of that was pretty sick -- basically putting regulations in overtime as companies went to the white house and treasury and

said hey what we want to go on a sales trip. now we need to put together some rags so a lot of what president obama companies doing to this expansively we know that. it's not going to be restricted. going to be expansive but a lot of the new one thing is going to basically come from lawyers and companies calling up the iis and saying hey you didn't address this can we get addressed. >> that's an important point. the distinction is there will be draft to come out. i think there's an expectation among the government. they are not going to get it entirely right the first time so there will be a rush of you and us to come in and say you didn't get this right and fix fix it and hopefully they do. >> right behind you there. >> eric furry furry and associates.

administration's said they will authorize u.s. depository institutions to have cuban accounts but not cuban banks to have u.s. dollar accounts. as that presented no problems or is that going to be good enough? >> it doesn't address egg export financing issues at all. >> the problems a journalist called me the other day from the financial times and have been talking with european banks on american banks on how they view the financial provisions which are limited credit card services and direct correspondence banking relations with cuba. she said that the european banks seem more interested in trying to expand their presence in cuba in light of those regulations than the u.s. banks. we have a grave problem right now that u.s. banks don't want to handle anything to do with

cuba including the consular account here to accept visa payments with the cuban interest section. it's a tremendously complicated problem that involves that one and cuba on the terror sponsoring list. i think it's probably coming up shortly. john kerry's been instructed to do or rip view of the report in six months and i think everyone is concluded that he will recommend that you would be taken off the list. that's only the beginning. the bank secrecy act, the patriot act even dodd-frank sarbanes-oxley money laundering statutes make american banks extremely risk-averse when it comes to countries that are under any kind of sanctions at all. i think we need more leadership from the administration treasury in particular the comptroller of the currency and among other things some scaling back of what

has become almost a predatory instinct of the u.s. government to hit financial institutions for gigantic penalties. for many cases whether inadvertent areas -- errors bookkeeping or for example cuba buys wheat from argentina. somehow the payment goes to the u.s. depository system system because it's wrongly been nominated in dollars. the treasury department will go after that foreign bank for millions of dollars in penalties. most recently party bus the french bank was hit with a $10 billion settlement with the u.s. government so it requires a change of culture and some of the regulatory agencies and also an attempt to deconstruct this thicket of laws and regulations that circumscribe u.s. banking services. >> over here on the right.

>> thank you. it's dana marshall with transnational strategy group. i wonder if i could get the panel to put themselves in a position or try to report to us on another issue that we haven't gotten much into. you talk a lot about the sanctions on the laws in these sorts of things which are critical. i wonder if they were represented by the panel say from a european trade association, japanese canadian. how do they see that market in terms of the market? is it comparable to any market we might be familiar with? how might they see it differently because let's say as we peel off various sanctions we are likely to confront the same kinds of pressures that they have. i wonder if there might be some general comments to help us understand what we are talking

about? >> any takers? >> you didn't mention canada but they might be most relevant and i think for nursing cuba have had complicated history and relationships. canadian companies have had their property expropriated and if not receive payment so i think some of the challenges that they face were taken later here on a panel earlier on this morning which is in the attitude of the bay where the cuban government that matters and how they participate in trade and investments. i think with candidates than the huge focus on tourism and d.c. canadian tourists going to cuba and services being provided and then you see a focus on basic industries. i know in a report in the press recently with asian economies

they sell cars and a cell buses and transportation equipment. there are some relationship in the biotech and pharmaceutical sectors between cuba and china but i think everything is still really nascent. someone asked how behind the curve are u.s. companies that they are trying to get into cuba with foreigners there already? there is no advantage to having been there for 10 years or if there is it's very specific to a couple of sectors. the growth in trade and investment will calm as the cuban economy grows and as cuban attitude start to change and his things on the ground started changing cuba. >> jono to put you on the spot but do you have anything to add as far as what the experience of other companies and other

countries that have been able to deal with cuba what their experiences are? >> we have worked over the years members of the organization with non-u.s. companies and we have had government trade groups. most countries -- i will use the example of farm equipment. in the u.s. let's say dear and case and then you have farm equipment manufacturing from india and japan and others. they have overtime watched what u.s. companies have done and how u.s. companies position themselves. u.s. companies, no one should think that u.s. companies don't know what's happening in cuba. many companies back in the 90s developed teams because there was a belief in the clinton

administration that there was going to be substantial movement and companies developed substantial teams some of the largest companies in the united states, teams of executives would get together quarterly and sometimes monthly to develop strategies and make sure they knew was going on. some companies had containers sitting in warehouses in miami ready to go with stuff. over time it waned as cuba would do something politically to make it untenable to do something. the food shelf in 2002 many embassies from other countries that are in cuba panicked because they saw at the food shelf that fidel castro was walking around and everyone is pointing in every company that went there got an order. it was incredible. the numbers went way up and cuba saw great benefit from it. and you had many of the embassy staff saying this is the end,

what are we going to do? but they also saw that so i would agree that because you have been there a long time if you are government entity then you have got some staying power by private entities, companies that they curry favor with from europe and ask for investment guide investment build things, develop businesses. they then put those people in jail but the companies out of business, took the business over so cuba is still going through a crisis of identity. they are trying to figure out what the definition of success is, what the definition of wealth is. how wealthy do we want people to become before we say that it's too wealthy and again not criticism but it all goes into the psyche. they will tell you when you go down there and meet with ministers we want everything.

we will buy everything, give us everything and the question is who's going to pay for it? and the foreign countries know that that is all about money. the communications element to present upon this announcement i don't know but i missed raul castro fidel castro anybody down there saying that they wanted everyone to have ipads, smartphones gmail siskos servers and routers and the rest of it and if you are a cuban and you are in the ministry of communications and someone from the u.s. comes with hardware at some point you're going to say how do we know it's not compromise before it arrives or that it can be compromise once it gets here? you people don't have the greatest reputation when it comes to securing your hardware.

and i'm not making a joke but these are real listed business decisions that cuba is likely to continue to look at china and russia and brazil and other places where they have political interests, where the governments are financed and ex-im bank is going to start getting involved. that's not going to happen here. they prefer to deal with government entities so most of their existing trading partners were all of a lot of money and cuba and has $14 billion in much of it hasn't been serviced on a regular basis. they are horrible credit risk, horrible. so the countries have and they know that. >> can i say something about how it applies to this? >> certainly if you can be brief and we'll try to get in a couple more questions. >> depending on how realistic

the u.s. government is their schizophrenia by cuba. rove castro periodically reaffirms that however they have necessary are opening to the world more and more in trade and foreign investments so it's like allowing building materials to be sold. ..

at some.in time when that is permissible what we will the risk scenario b? you alluded earlier, if you want to restate the.you made >> i can only recite what i have read. there is an anticorruption crackdown in cuba that has been going on for about a year or two that is implicated some mid to high level cuban officials and is also because the only hard currency sector of the economy are foreign businesses, that anticorruption has landed heavily on english and canadian companies. executives have been in prison, so i do do not no where quite that is going. i think a greater risk at

the moment is being pulled into a cuban anticorruption drive rather than the justice department knocking at the door. >> a question. yes. right next to you. >> good morning. i work here in dc. i am interested in knowing what do you think will happen with the foreign claims settlement commission who will pay them? do you have to pay them before receiving commercial relationships with cuba? clarksburg,. [inaudible conversations] [inaudible conversations]

the 10th chief of the claims are top-heavy. the top 25 companies represent represent approximately two thirds of the total value of the awards. so if some kind of disposition of those claims can be made the rest can be worked out over time through some kind of lump some agreement payable over time. how that we will be resolved, resolved, the company should approach this and eventually inflexibly and consider using claims against cuba as the basis for negotiated reentry perhaps through a deck to have debt equity swap perhaps swap, perhaps recovery of a property that they think currently fits their business model. it is going to be complicated.

those those who we will come out best will be those who help themselves. companies that set back and wait for the government to knock on the door and have the government and the macek are going to do quite poorly in this. >> we don't no how that we will resolve itself. as we have seen in other instances there we will have to be some resolution of the us government espousing those claims certifying those claims were now more than $7 billion. there will be some resolution of that but it will ultimately be a political question. but i think it we will

require resolution and there we will be some payment on his claims. >> right next to you. >> before i ask my question. there was a comment made by cuban community in florida. frankly the anti- castro community does very little fundraising for the vast majority of republican members of the house or senate. rank-and-file republicans typically look to certain members of the florida delegation who they personally like and respect and considered to be experts on latin american policy. the cuban issue is a personal and emotional issue.

>> much of the business that has been done has been done from state-owned companies as they don't company. >> what has been their experience with a privately provided credit? >> i cannot speak specifically to any particular european company. we can just look at the statistics. what we are seeing in the agricultural community is the europeans are being successful. they have been successful. like any business you do not sell without getting paid, so certainly because we have seen the uptick in sales whether brazil or europe over time they are working out financing arrangements that are beneficial.

>> to comment it gives on a bipartisan basis i have watched over time approximately half the black congressional caucus vote pro- embargo. very artfully debbie wasserman schultz in charge of the house reelection committee for democrats is a principal recipient of some of that money. i did not mean to suggest the republican opposition to lifting the embargo is solely because of funding. in the bill was brought to lift the travel ban could not get out of a democratic-controlled committee and to have in a democratic-controlled house. that is a testament.

>> very quickly most european companies have had collection issues with cuba. many of those companies have had government entities within their respective countries guarantee and provide credit guarantees. almost in all cases that has to be >> we have time for one last question in the back. >> -right-curly-bracket. >> some of the priorities of

the new us cuba coalition for agriculture generally. there was a lot of talk about how some of these changes don't have to be made legislative palace on to the impression that credit purchases might be one of those changes. what authority does the executive branch had to make changes to credit payment with regard to keep and also more broadly what is the agriculture coalition going to do what is being those that they are working on members of congress back. >> we would agree with you on the credit side. the announcement can only take us so far. it may offer a few extra days.

for example we we are not allowed to put a ship to queue until we have secured a 3rd country letter of credit or have cash in hand. with the announcement has done is allowed us to perhaps put the ship and queue, get the process music , love the vessel shift the vessel and the transfer of title takes place that is what we need to have the cash in hand. certainly our read is the same as yours. definitely limiting primed for a private financing. it will take an act of congress for us to be able to take advantage of flexible financing terms. the answer is yes. we certainly do have recommendations on what the bill should look like.

it is clean and about a page and a half and would overturn the restrictions and work toward a pathway of liberalization and we will certainly be going up with a consistent voice. again,. again, we don't define this is republican democratic issue. and to robert's am glad to here you agree. the bulk of the members of congress would tell you that they do not agree with keeping the embargo in place our need to do is provide the information, the flexibility and quite frankly we do believe the story will begin selling itself. again, i'm an optimist. >> well unless anyone has a burning comment that they want to close with our like

to say thank you and the want to thank reader for sponsoring this thank you for your participation and out few have an unthought day out there today. [applause]