HAVANA — In the coming months, when American hotel executives arrive to take over management of Havana’s landmark Hotel Inglaterra, chef Jorge Luis Bormey will become one of the first Cubans to work for a U.S. company in nearly 60 years.
“I’m excited,” he said. “We’re pioneers.”
The Inglaterra, where Bormey has spent 15 years frying bananas and stirring pots of black beans, is one of the three properties the Starwood Hotels and Resorts chain will operate in a trailblazing arrangement that blows the biggest hole yet in the U.S. trade embargo first imposed in 1960.
The deal reached by Starwood, which Marriott International is attempting to acquire, was possible only with specific approval from the Obama administration, and it represents a sea change in the thinking about the best way to influence Cuba’s rigidly controlled one-party system.
Instead of blocking off the forces of American capitalism, the Obama administration now wants them to come flooding in — and leave it up to the Cuban government to cope with the consequences.
On the afternoon of his first full day in Havana, Obama hosted a business summit at a beer brewery in the harbor, and it seemed to signal the beginning of a business comeback. He was heartily cheered by Cuban small-business owners, American executives and others who support his stated goal of ending the embargo, which would require congressional action.
“More Americans coming to Cuba means more customers for your businesses,” Obama told the audience during a forum hosted by CNN’s Soledad O’Brien, whose mother is from Cuba. He took questions from a Cuban barbershop owner, a fashion designer and a farmer, and he touted the benefits of an open, market-driven, innovation-based economy, saying the United States wants to help Cuba build one.
“U.S. business leaders are not interested in seeing Cuba fail,” he said. “We are interested in seeing Cuba succeed.”
Critics say Cuban officials will know how to extract the financial benefits without ceding political control or allowing a Cuban middle class to develop that could demand greater freedoms.
As Obama spoke Monday, in front of a backdrop of huge Cuban and U.S. flags, the cruise line operator Carnival Corp. was reaching agreement on its own deal with the Cuban government under which some of its cruise ships will begin visiting the island starting in May. Western Union on Monday announced expanded service, as well.
Obama said that Cisco Systems would partner with a Cuban university to develop an Internet technology academy and that General Electric is working on an aviation and energy deal.
The gathering took place in sight of a former Texaco oil refinery that Fidel Castro nationalized in 1960 after its American managers refused to process a shipment of Soviet crude. The United States retaliated by cutting Cuba’s sugar quota, and relations spiraled downward from there as the government took control of virtually all commercial property on the island — down to the ice-pop carts and shoeshine stands.
Obama’s visit is expected to trigger a cascade of new commerce between the longtime foes as the administration pushes the legal boundaries of the trade sanctions and increasingly renders them meaningless. Before his trip, Obama also lifted restrictions on Cuba’s ability to use the U.S. dollar in international financial transactions.
While only Congress can fully lift the embargo, deals such as the one Starwood has reached open big cracks in its foundations. The agreement is believed to include the settlement of a $51 million claim by the hotel firm against the Castro government, over property belonging to a predecessor company that was confiscated following the Cuban revolution.
“I think it’s become clear that it’s a matter of when, not if, the embargo will be lifted,” said James Williams, president of the anti-embargo lobbying group Engage Cuba. “These major brands are showing that they believe that, too. They wouldn’t announce these deals if they thought they would be rolled back.”
Though Obama’s stated goal of allowing increased trade and travel is to benefit the Cuban people, Starwood’s management contract will make it a direct partner of Cuban state firms, including the military-run tourism company Gaviota.
U.S. officials acknowledge that the Cuban government will profit from new commercial ties, but they say small businesses and the island’s people will benefit, too.
Americans dominated Havana’s hotels and casinos until Castro’s bearded rebels threw them out and took over the properties, depicting the U.S. owners as exploitative capitalists.
Starwood chief executive Thomas B. Mangas said the company is “very proud to bring our experience” to Cuba and to be “at the forefront” of U.S.-Cuban diplomacy.
Some of the Cuban staff members at the Hotel Inglaterra said they were a bit worried about whether Starwood would let them keep their jobs, but they were mostly excited to start working with their American bosses. The Cuban government will retain ownership of the physical property, and like all foreign companies in Cuba, Starwood will have to hire workers through a state agency.
A Cuban national landmark, the hotel opened in 1886, advertised as “the best appointed house in the city.” A young war correspondent named Winston Churchill stayed there in 1895 when Cubans launched an uprising against Spanish colonial rule.
Ania Mastrapa, the public relations manager who doubles as the hotel’s unofficial historian, said the Starwood executives fell in love with the property when they first visited a few months ago. “Everyone knows that they’re going to bring improvements and raise the standards of the hotel,” she said.
Mastrapa said she was confident the new managers would want to keep her. “I’ve worked here 20 years,” she said. “Who else could tell the story of this place with so much affection?”