Cuba bracing for rough waters as leftist tide goes out

Cuba bracing for rough waters as leftist tide goes out
20 May 2016 at 15:45 AFP

HAVANA - Cuba is bracing for rough waters ahead as it navigates a
political sea change in Latin America, where the left is fighting an
outgoing tide.

The government of Cuban President Raul Castro warned in April of a
"strong and articulated imperialist counteroffensive" coinciding with
the economic slowdown in Latin America
Venezuela is in a full-blown crisis, conservatives have taken the helm
in Brazil, and Havana's leftist allies are losing ground in elections
elsewhere in the region.

The government of President Raul Castro, which has enjoyed smooth
sailing until recently, warned in April of a "strong and articulated
imperialist counteroffensive" coinciding with the economic slowdown in
Latin America.

Indeed, Cuba's communist regime can no longer count on the rhetorical
support it has received in recent years from Latin governments, warns
Michael Shifter, head of the Inter-American Dialogue, a think tank based
in Washington.

"For Cuba, the region's changing political landscape is less hospitable
than it was a few years ago," he said in an interview.

The changes mark the end of a favorable era for Cuba, one that began
with Hugo Chavez's arrival in power in Venezuela in 1999, and reached a
high point with the reconciliation with the United States at the end of
2014.

Taken in hand by the late Venezuelan leader, Havana emerged from
isolation and economic disarray in which it was left after the collapse
of the Soviet Union in 1990.

Friendly governments took office in Argentina, Brazil, Bolivia, Ecuador,
Nicaragua, Uruguay, El Salvador, Peru and Chile.

But after Chavez's death in 2013, political conditions in Latin America
began to shift, although the region's new conservative direction has
only recently come into focus.

This year, Venezuela's downward spiral entered a critical phase,
Brazil's Dilma Rousseff was suspended to face an impeachment trial,
Argentina turned its back on Nestor and Cristina Kirchner's 12 years in
power, Bolivia's Evo Morales lost a referendum on extending his mandate
and Ecuador is preparing to elect a successor to Rafael Correa.

And what's worse: the region has had to wave goodbye to the high
commodities prices that underwrote the left's most appealing social
programs.

"Even more than the political shifts, Cuba will be affected by the
economic crises in Brazil, and particularly, Venezuela," Shifter said in
an interview.

"At a moment when Cuba is hoping to bring in more investment and
generate growth, the economic deterioration in both countries is of
enormous concern," he said.

- US lifeline -

Besides being its principal trade partner, with nearly $7.3 billion in
trade in 2014, Venezuela supplies Cuba with 95,000 barrels of oil a day
on very favorable terms.

No other friend of Cuba "can supply oil under those terms," said Jorge
Pinon, head of the energy program at the University of Texas' Jackson
School of Geosciences.

The loss of cheap oil "would represent a negative impact for Cuba of
approximately $1.3 billion," he said.

Brazil, for its part, is one of Cuba's main suppliers of food, a source
of credit and a partner in tobacco and sugar companies.

Brazil and Venezuela together account for much of the $12 billion Cuba
gets each year for supplying medical services to other countries, its
top source of hard currency.

Even as it closed ranks behind Venezuela's embattled President Nicolas
Maduro, the Castro government joined critics of the legislative process
in Brazil that ended in Rousseff's suspension this month.

The interim government in Brasilia led by Michel Temer has responded to
the Cuban criticism with a blunt reminder.

"The relationship is historic. We have interests in those countries and
they have theirs here," a Brazilian foreign ministry official told AFP.

Jorge Duany, head of Florida International University's Cuban Research
Institute, said, "Cuba will have to reorient its diplomatic and
commercial relations in Latin America and the Caribbean beyond its main
regional allies of the last decade."

Cuba may already be moving in that direction, according to Duany.

"It's possible to interpret Raul Castro's government's rapprochement
with the United States, in part, as a preventive response to the
continuous economic and political deterioration in Venezuela," he said.

Cuba reestablished diplomatic relations with the United States in July
2015 after a half century of Cold War enmity.

Even though a US embargo is still in place, the United States could play
a growing role as a supplier of food and tourists to Cuba, two important
lifelines.

"It is reasonable to expect Cuban imports from the United States to
continue to grow, especially as restrictions are reduced and,
eventually, the embargo is lifted," said Shifter.

Meanwhile, Cuba has settled its pending affairs with creditors in the
Club of Paris, and signed a cooperation agreement with the European
Union, which should translate into access to more markets and financing.

Cuba will need such a multi-dimensional strategy to weather the storm.

Source: Cuba bracing for rough waters as leftist tide goes out | Bangkok
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