Photo by Álvaro Fernández
Cuba’s economy and its emigrants
Since the triumph of the Revolution, one of the objectives of U.S. policy has been to drain Cuba of its qualified workforce which a good functioning economy requires. Thousands of professionals and technicians have emigrated, most encouraged by the exceptional advantages offered by this policy, which in turn required a monumental educational effort to replace them.
Paradoxically, while this effort enriched Cuba’s human capital, to the point of making it one of its main economic assets, it created objective bases for the constant reproduction of migratory flows, which today affect various line items of the social and economic life of the nation. Although emigration, at least in current volumes and composition, constitutes a cost for the country that cannot be fully compensated by other means, it is undeniable that emigrants contribute in various ways to the Cuban economy and could do much more if the right conditions were created.
First of all, as is the case from many migrant-sending countries, they do so through remittances. Most estimates reveal that Cuba receives about $3 billion annually via this route, 68 percent coming from the United States. And although the calculation of remittances and their real impact on the economy is always misleading because of the way this money circulates, there is no doubt that it constitutes a significant inflow of fresh capital, part of which is destined for investment in private sector businesses created in the country.
Because they are intended for the well-being of their families in Cuba, remittances have a moral component that transcends the economic aspect and reproduce a very solid connection with their country of origin. Remittances do not constitute charity, but rather a legitimate income for Cuba, a country that has contributed, like few others, to the preparation of its migrants and is fully entitled to design policies that enable some level of recovery of this investment for all Cuban society.
To the cash remittances we should add those that arrive in the form of merchandise, calculated to be another $3 billion annually, which also serve for the development of businesses in the private sector. Although reluctantly accepted by the Cuban government, since they are supposedly alter rules established for the operation of the market, these remittances help to satisfy the needs of the population, contribute directly to the state budget by collecting customs fees and, in many cases, they constitute a massive violation of the economic blockade imposed by the United States on the country.
Another important contribution immigrants make to the Cuban economy is through tourism and family visits. According to data from the Cuban government, in the last five years, more than one million emigrants have made 4.6 million visits to the country. In 2019 alone, there were 624,000 visits, 70 percent from the United States, making emigration the second largest source of tourists to Cuba. This, despite the excessive cost of passports and other consular procedures that limits the incentive and the possibility of an increase of these trips.
More than 50,000 emigrants have applied to resettle in the country in recent years. In general, these people do not constitute a social burden, but return to Cuba with their savings and pensions, and therefore contribute to the national economy in numerous ways, whether through personal and family consumption or the establishment and promotion of private businesses.
The contribution of emigrants also often takes the form of paying for communications from people residing in Cuba and financing their visits abroad. In the last five-year period this figure has exceeded four million trips, despite the fact that the United States has practically reduced this possibility to zero since 2017, using the excuse of the so-called sonic attacks on its embassy officials.
Until now, I have not discovered anything not been dealt with before by other sources; in fact, much is said and written about the economic advantages of Cuba and its relation with its emigration. However, a less widespread aspect is what the U.S economy earns from this, especially certain businesses located in South Florida, mostly owned by Cuban-Americans, thanks to the immigrant ties to Cuban society.
It seems that no one wants to know this information. It is a subject scarcely dealt with by the American press. There are hardly no published studies regarding the impact of the Cuban market on the economic structure of South Florida, despite the fact that it involves activities that produce millions of dollars to their economy. However, the reality is so evident that it does not take much research to calculate its impact.
With ups and downs based on the state of relations between the two countries, these services and commercial operations mobilize billions of dollars and provide hundreds of jobs in a market that includes airlines, cruise ships, travel agencies, banks, lawyers, specialized stores for shipments to Cuba, pharmacies, communications companies, even funeral homes that are in charge of burying a relative in Cuba.
Every Cuban emigrant who visits the Island, or every Cuban who visits the United States, is a client of this infrastructure. The profits derived from remittances, merchandise sent, or phone calls made also remain there. An emigrant who invests in a business in Cuba does not do it exclusively for charity, but because it is also convenient for his own interests. This has the capacity to grow much more if both Cuba and the U.S. would facilitate these investments.
According to the logic of political thinking in the United States, this should be a powerful economic base for forces in the Cuban-American enclave who support an improved relations with Cuba, which explains why the right acts against them whenever possible. This potential has yet to be achieved and what happens in many cases is that these businesses end up paying their enemies for their blackmail as long as the spotlight of attacks is not shone on them.
Trump administration policy, under the guise of the Cuban-American extreme right, which aims to harm these businesses, not only affects Cuba, as many argue, but also clients, businessmen and other workers who live from these activities. Ultimately, the U.S. economy is affected, especially in the state of Florida, whose complementarity with the Cuban market offers great development opportunities for both sides.
I find it striking that the victims in this case don’t react more vigorously to this situation. And these should include Florida politicians who should be defending the economic interests of their state. One of the rare studies done on this subject was carried out by retired FIU Professor Kenneth Lipner in 1999. Dr. Lipner calculated that doing away with the embargo would represent about a billion dollars a year to the South Florida economy, along with 40,000 new jobs. At the time, the professor attempted to present his results to Miami-Dade County commissioners, who did not even comment on his work. Later on, in 2010, Progreso Weekly reported that the U.S. Chamber of Commerce estimated that a “Cuba without the embargo would be … a boon to [the U.S.] economy.” They said that from $1.2 billion to $3.6 billion would be injected to the country’s economy, along with thousands of new jobs.
But it is obvious that, in this case, the will of the extreme right silences many and prevails over any other consideration, even over the very logic of capitalism. The situation, as is, goes against the current no matter how stubborn the facts.
It is true that the remittances, travel and other forms of contact by its emigrants with Cuba cannot be understood as a reliable sample of support for the Cuban government, but they do reflect needs and interests whose solution involves a better coexistence between the two countries. Herein lies the point of demarcation of positions with respect to Cuba within the Cuban emigration.
