Texas firms jump into Cuba business

[Texsox]

By Bonnie Pfister

Express-News Business Writer

 

Web Posted : 01/10/2004 12:00 AM

 

As 2003 drew to a close, Texas began to grab some agricultural trade with Cuba just as the Bush administration clamped down on travel there.

 

In the two years since Congress has allowed American farmers to export to the socialist nation, $328 million in U.S. beans, rice, chicken and other goods have sold to Alimport, Havana's food-buying agency.

 

Such agribusiness giants as Archer Daniels Midland, Cargill and Tyson dominate the market.

 

After hanging back, Lone Star State companies have taken the plunge, with Dallas-based Dean Foods signing a $162,000 contract for coffee creamer in November.

 

Corpus Christi's dry-food packaging firm WestStar Food signed a $1.5 million pinto bean contract with Alimport as well. Two private Texas firms that declined to be named have contracts to deliver nonfat powdered milk and cotton.

 

Cynthia Thomas, president of the Texas Cuba Trade Alliance, said those numbers are sure to grow.

 

Thomas, who discussed that market at a meeting Thursday of Texas corn and grain-sorghum producers in Corpus Christi, said she expects Texas' exports across the Gulf of Mexico to triple to $30 million in 2004.

 

But some Cuba-watchers say the Bush administration is discouraging legitimate travel to the island as part of election year posturing.

 

Business leaders, scholars, religious groups, athletes and artists may visit the island but must be licensed by the U.S. Treasury Department and be "fully hosted," which limits how much U.S. money may be spent there. Flights directly from Miami leave several times a day.

 

In recent years, however, many licensed American visitors have stretched those boundaries into the realm of outright tourism. After Castro jailed 75 dissidents in March 2003, Washington tightened its travel rules.

 

In October and November, Homeland Security officials said they'd caught 44 people traveling illegally to Cuba and noted nearly 600 violations of bringing home unauthorized alcohol or tobacco.

 

Licensed American travelers are permitted to bring $100 worth of rum or cigars home for personal use, and the government now limits U.S. port authorities to a single visit per year.

 

But even those who follow the rules are under increased scrutiny.

 

"Illegal travel, legal travel — they're definitely clamping down," said David Cibrian, a San Antonio-based lawyer with Jenkens & Gilchrist. One client who legally traveled to Cuba nine years ago began receiving queries about that trip last year.

 

John Kavulich, president of the 10-year old U.S.-Cuba Trade and Economic Council, said he receives regular complaints from business travelers who say licenses that previously could be processed in a few days now take several weeks.

 

"Treasury was instructed by the State Department, which was instructed by the White House, to use every available means to discourage lawful commercial-related travel to Cuba in keeping with overall publicly stated strategy of decreasing the number of individuals visiting Cuba for any authorized purpose," Kavulich said.

 

A Treasury Department spokeswoman countered that most business licenses are processed within two weeks and referred those interested to the department's Web site, www.treas.gov/ofac, for further information.

 

Washington isn't the only government playing politics. U.S. entrepreneurs have grumbled to Kavulich that Alimport is urging them to be more public and vocal in opposing the embargo and that purchases reportedly have been funneled toward those who do so.

 

But many simply try to avoid discussing politics, focusing narrowly on a new export market during an era in which most of the United States' international trade is principally about buying, not selling.

 

"Balanced trade seems to be a logical thing to me," said Leigh Phillips, president of Houston-based freight-forwarder Biehl & Co., an Alimport contractor. "It's exciting to see a new market for U.S. exports. And it's also rewarding that it's food."