US, Cuba Chart New Course

The announcement that the US and Cuba will be re-establishing diplomatic relations yesterday [Dec. 17, 2014], has created quite a buzz in the travel industry in Canada. But before everyone whips themselves into a panic, take note of the fact that even with the changes that have been announced, Americans still cannot travel freely to Cuba at this point in time – although that day is clearly coming.

In reaction to the announcement, officials at Canadian-owned Cuba Cruise indicated that while unlicensed U.S. tourist travel remains banned, the company anticipates increased bookings from international travellers eager to explore a country that is virtually free of American commercialization before it might change.

Officials at Sunwing Travel Group reacted to the changes, pointing out that the company is “well positioned to benefit from the potential market changes that would be associated with a decision to lift the United States travel embargo to Cuba.”

Sunwing notes that it owns Atlanta-based Vacation Express, as well as Blue Diamond Resorts, which already operates 11 resorts and over 6,000 rooms in Cuba. Blue Diamond’s Cuba portfolio includes all-inclusive resort brands like Royalton Luxury Resorts, Memories Resorts, and the newly introduced Starfish Resorts.

However, Janine Chapman, vice-president of marketing, Sunwing Travel Group, made it abundantly clear that: “It is anticipated that if the embargo is lifted, there would be significant interest from the U.S. market to travel to Cuba. The increasing demand from this new source market could impact Canadian vacationers in the form of reduced availability, particularly in the last minute market. Canadian tour operators that are not vertically integrated could be forced to re-position aircraft to other destinations in the event of accommodation shortages.”

Cuba Cruise president and CEO, Dugald Wells also offered his views, observing: “We do not anticipate that Wednesday’s breaking news regarding the U.S. and Cuba will have an immediate effect on our business practices and model. However, we absolutely foresee an increase in bookings from international travellers who are drawn to Cuba’s incredibly preserved culture, its mix of old and new world charm, and who want to experience the iconic country before it opens its doors any further.”

In White House briefing notes, it is pointed out that the current changes will facilitate an expansion of travel under general licenses for the 12 existing categories of travel to Cuba authorized by law, which include:

• General licenses will be made available for all authorized travelers in the following existing categories: (1) family visits; (2) official business of the U.S. government, foreign governments, and certain intergovernmental organizations; (3) journalistic activity; (4) professional research and professional meetings; (5) educational activities; (6) religious activities; (7) public performances, clinics, workshops, athletic and other competitions, and exhibitions; (8) support for the Cuban people; (9) humanitarian projects; (10) activities of private foundations or research or educational institutes; (11) exportation, importation, or transmission of information or information materials; and (12) certain export transactions that may be considered for authorization under existing regulations and guidelines.
• Travelers in the 12 categories of travel to Cuba authorized by law will be able to make arrangements through any service provider that complies with the U.S. Treasury’s Office of Foreign Assets Control (OFAC) regulations governing travel services to Cuba, and general licenses will authorize provision of such services.
• The policy changes make it easier for Americans to provide business training for private Cuban businesses and small farmers and provide other support for the growth of Cuba’s nascent private sector. Additional options for promoting the growth of entrepreneurship and the private sector in Cuba will be explored.

In making the announcement, President Obama said: “The U.S. will take steps to increase travel, commerce, and the flow of information to and from Cuba. This is fundamentally about freedom and openness, and also expresses my belief in the power of people-to-people engagement.”

And the president continued: “With the changes I’m announcing today [Dec. 17, 2014], it will be easier for Americans to travel to Cuba, and Americans will be able to use American credit and debit cards on the island. Nobody represents America’s values better than the American people, and I believe this contact will ultimately do more to empower the Cuban people.”