President Trump speaks at the Manuel Artime Theater in Miami on Friday. (Mandel Ngan/AFP)

President Trump announced a new Cuba policy Friday afternoon that envisions prohibiting financial transactions between U.S. citizens and companies and Cuba’s military and intelligence services, as well as changes in regulations allowing U.S. citizens to travel to Cuba.

The partial reversal of former president Barack Obama’s opening to Cuba still must be spelled out by Treasury and Commerce department regulations not yet written.

Trump said he wants to pressure Cuban President Raúl Castro and other communist leaders to allow Cuba’s private sector, especially the country’s tourism industry, to operate more freely.

The president announced his plan at the Manuel Artime Theater in Miami’s Little Havana neighborhood, the heart of Cuban American culture in the United States.

“The previous administration’s easing of travel and trade does not help the Cuban people,” Trump said. “They only enrich the Cuban regime.”

Officials in the Trump administration say that if the Cuban government releases political prisoners, grants Cubans more political and religious liberties, and allows more money to go the private sector, the United States would reconsider its current actions.

The proposed policy focuses on two of the provisions stemming from Obama and Castro’s historic agreement in 2014 to normalize relations between the United States and Cuba.

The new policy changes will not go into effect immediately. Trump’s directive will order the Treasury and Commerce departments to start writing the new regulations within 30 days.

Many of the restrictions Obama loosened will not be affected.

What is changing

Travel

Current actions

Under Obama’s regulations, Americans can travel relatively easily to Cuba.

What the new policy will do

The restrictions Trump plans to implement could significantly affect American travel.

While the government does not prohibit travel to Cuba by Americans, the Treasury Department does not allow U.S. citizens to spend U.S. dollars there without a special license.

Obama loosened that regulation by permitting individual Americans to travel to Cuba if they declare their trip’s purpose in one of 12 permitted categories, including activities pertaining to religion, education or humanitarian efforts.

Obama has allowed a broad category of “people-to-people” visits to the country. Trump proposes to prohibit individual travel in that category, requiring Americans to travel as part of Treasury-licensed groups.

Under current regulations, travel by non-Cuban Americans was expected to increase by more than 100 percent, according to Cuba’s Foreign Ministry. About 285,000 non-Cuban American  visitors from the United States arrived in the first five months of 2017, equaling the number who visited in 2016.

Cuban tourism on

the rise

4.1M

4 million arrivals

3

2

742K

1

0

1995

2017

Predicted

Sources: The World Bank, Cuban Ministry of Tourism

Cuban tourism on the rise

4.1M

4 million arrivals

3

2

742K

1

0

1995

2000

2005

2010

2015

2017

Predicted

Sources: The World Bank, Cuban Ministry of Tourism

The Foreign Ministry said it expects that more than 4.1 million people will visit the island by the end of the year. The vast majority of Cuba’s visitors, however, still come from Europe, Canada and South America.

Transactions with the military-controlled businesses

Current actions

Obama allowed some transactions with security services on the grounds that money would go to individual Cubans who gained employment and more contact with the outside world.

What the new policy will do

No transactions of any kind with the Cuban military.

Cuba’s military, the Revolutionary Armed Forces, has significant control over the country’s economy, especially the tourism sector. And with Trump’s new plan, the president and his administration hope to prevent additional U.S. money from reaching the Cuban military.

The new policy will ban any commercial dealings with the military and security services. This includes prohibiting U.S. citizens from lodging at any military-owned hotels. However, Americans can still stay in privately owned homes and non-military-owned hotels, and spend money on restaurants and taxis.

Two major critics of the Obama opening have been Sen. Marco Rubio (R-Fla.) and Rep. Mario Diaz-Balart (R-Fla.), both of whom have lobbied for Trump to reverse the policy, and they attended the president’s speech in Miami on Friday.

“The policy centers on the belief that the oppressed Cuban people – rather than the oppressive Castro regime’s military and its subsidiaries – should benefit from American engagement with the island,” Rubio said in a statement. “This will be the first time in several decades that the Cuban people will have an economic advantage over the Cuban military.”

Rep. Ileana Ros-Lehtinen (R-Fla.), who has also publicly opposed renewed relations but did not attend the speech, citing family matters, said she, too, supports Trump move on Cuba.

“I commend my legislative brothers, Senator Marco Rubio and Congressman Mario Diaz-Balart, for playing an instrumental role in crafting this initiative which curtails cooperation with the Castro regime’s military monopoly,” she said.

The military’s business enterprises in the country are expansive, with estimates suggesting they bring in more than half of the country’s foreign revenue.

Most of the Cuban military's businesses are clustered in a management company, Grupo de Administración Empresarial, S.A., also known as GAESA.

GAESA’s many hands in the Cuban economy

Car and ship maintenance

Fossil fuel

Mapping

GEOCUBA

PETAF

SERMAR

SASA

 

Military enterprises

Cooking oil

ECASOL

 

UIM

UAM

Currency and financial services

UCM

TRD

Real estate

RAFIN

Inmobiliaria

Almest

GAESA

CIMEX

Shipping

and logistics

Banco Financiero Internacional

 

AUSA

Enviornment

Alamacenes Universales

Grupo Bahía de

La Habana

Technology

HABAGUANEX

Film production

Grupo de

Turismo Gaviota

 

TECNOTEX

TRIMAGEN

TECNOIMPORT

Hospitality

and tourism

Note: Only confirmed entities are shown

Sources: Miami Herald, Foresight Cuba, Economic and Commercial Office of Spain in Havana

GAESA’s many hands in the Cuban economy

Car and ship maintenance

Fossil fuel

Mapping

GEOCUBA

PETAF

SERMAR

SASA

 

Military enterprises

Cooking oil

UIM

ECASOL

 

UAM

UCM

Currency and financial services

Real estate

TRD

Inmobiliaria

Almest

RAFIN

GAESA

CIMEX

Banco Financiero Internacional

 

Shipping

and logistics

AUSA

Alamacenes

Universales

Enviornment

Grupo Bahía de

La Habana

Technology

HABAGUANEX

Film production

TECNOTEX

Grupo de

Turismo Gaviota

 

TECNOIMPORT

TRIMAGEN

Hospitality

and tourism

Note: Only confirmed entities are shown

Sources: Miami Herald, Foresight Cuba, Economic and Commercial Office of Spain in Havana

GAESA, led by Gen. Luis Alberto Rodríguez López-Callejas, President Castro’s son-in-law, is the country’s largest conglomerate, with dozens of entities and industries that affect most the country’s economy, including trade, financial services, hospitality and technology.

In the tourism industry, GAESA operates about 100 hotels, restaurants and other travel-related businesses through a subsidiary company, Gaviota Tourism Group.

Gaviota’s tourism reach

in Cuba

Hotels: 55

Restaurants: 26

Recreation centers: 18

Yacht

Marinas: 5

Transportation

companies: 5

Other

companies: 3

Source: Foresight Cuba, Economic and Commercial Office of Spain in Havana

Gaviota’s tourism reach in Cuba

Hotels: 55

Restaurants: 26

Recreation centers: 18

Other

companies: 3

Yacht

Marinas: 5

Transportation

companies: 5

Sources: Foresight Cuba, Economic and Commercial Office of Spain in Havana

What isn’t changing

Trump’s revised policy does not affect some of the long-standing agreements originally made by Obama and Cuba.

Family travel

Unlimited “family” travel for Cuban Americans to visit their loved ones on the island will remain.

Remittance

The policy change to increase the amount of remittances that can be sent to non-family members in Cuba from $500 to $2,000, as well as the change to allow travelers to carry as much as $10,000 to Cuba will not be affected.

Trade

The United States’ trade embargo against Cuba will remain, limiting exports to certain agricultural goods and medical devices, which have been permitted since 2000, according to the Office of the U.S. Trade Representative.

U.S. exports to Cuba since 2000

$700 million

$83M

600

As of

April

500

400

300

200

100

$1.3M

0

2000

2017

Source: Census Bureau

U.S. exports to Cuba since 2000

$700 million

600

500

$83M

400

As of April

300

200

$1.3M

100

0

2000

2005

2010

2015

2017

Source: Census Bureau

With renewed relations between the United States and Cuba, there have been calls to end the embargo, a move supported by 73 percent of Americans, according to a poll conducted by the Pew Research Center in December.

Democratic lawmakers and a handful of Republicans support ending the embargo, while a majority of Republicans want it kept in place.

Congress is the only legislative authority that can repeal the embargo.

Ending special immigration status for Cuban migrants

Also staying in place is Obama’s decision to eliminate a special status once enjoyed by Cubans, who when they reached the United States automatically received authorization to stay. 

Cruise ship and airline travel

Regulations that allow U.S. commercial flights and cruise ships to travel to the island will not be affected.

Diplomatic relations

The U.S. and Cuban embassies in Washington and Havana will remain open.

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