U.S. and Cuba Trade Embargo

Alston Martin

The trade embargo started in 1959, when Fidel Castro over threw Fulgencio Batista. The United States recognized his government, as it was communist, but decided they would still trade. Although, as Castro increased trade with the Soviet Union, while also spiking the taxes on American imports, the United States responded as they only knew how. President Kennedy instituted a ban on nearly all exports to Cuba, which in turn lead to an economic embargo. This embargo lasted well till 1992, when the US strengthend the embargo and would not lift it until Cuba held free and fair elections to a democratic government that excludes Castro. The Cuban government estimates it has lost over 1.126 trillion dollars from not trading with the US.

In 2014, Barack Obama severed the embargo, restoring all ties with Cuba. In 2015, the Dept. of Commerce issued approvals for business transactions worth 4.3 billion dollars in Cuba. Over 150,000 tourist have visited Cuba from America, annual funds were sent from the US to Cuba worth around 1.4 billion. All of these numbers are up from previous years when the embargo was issued. It is safe to say that working out a deal dramatically improved Cuba's economy. The new rule also allowed travelers to use US credit and debit cards, banks to facilitate authorized transactions, US companies to invest in some small businesses, and shipment of building materials to private Cuban companies. With tourism to Cuba increasing, it will increase the economy, as more people are spending money in Cuba.

The trade embargo that was input on Cuba greatly affected their exports, imports, net exports, net capital outflow, and economic growth. The US is the closest country to Cuba, which makes them a great trading partner. You are able to ship things quicker to them, or receive things quicker. The lifting of the embargo saved Cuba. Since then Cuba on their own have decentralized the agricultural sector, relaxed restrictions on small businesses, made it easier for Cubans to obtain government permission to travel abroad. All of these things will help to increase the Cuban economy, as people have more freedom to make an use their money. It will also improve other countries economies, as they made it easier for Cubans to travel. Cuba is a new country, many experts are calling it a "new era" of hemispheric relations.

Obviously Cuba struggled for a long time. Once someone issues an embargo on you, you stop receiving things you need, your imports will fall. The money you receive from importing things to that country will fall. Your country won't be able to grow their capital outflow and grow their economy, because they are in an embargo with one of the top countries in the World. It is never a good situation to be on the other side of, but it is necessary if someone wants the democracy to change. Kennedy placing the embargo was the best thing for Cuba, as it made todays ties with the United States better than ever.