Think tanks expect US travel to Cuba to open fully by Oct

Saturday, November 21, 2009 1:20 AM

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By Steven Jackson, Business Observer writer

Wednesday, June 10, 2009

Two Washington think tanks expect the US travel ban on Cuba to be totally lifted this year in a move which Jamaica views with fortune and fear.

Jamaican small hotels will likely feel the brunt of possible fallout to the local sector.

The US Congress will vote in September on lifting the ban according to Daniel Erikson of the Inter-American Dialogue and Sarah Stephens for Centre for Democracy in the Americas. Both were in Kingston last week at a conference on Caribbean Studies and presented on US-Cuba Relations: A Roundtable Discussion with Washington Think Tanks.

"I think it's possible by September or October that congress will lift the travel ban for all Americans to Cuba," said Stephens whose think tank is lobbying the US government for the end of the five-decade-old US/Cuba embargo. "It will be very tough to get to that final ending of the embargo anytime soon. But I think that the lifting of the current travel ban is real. I think that can happen and part of the reason is that it is in Congress' hands and they want to do it."

The Inter-American Dialogue aims to stimulate debate and discussion on the proper course for US-Cuba policy, focusing on the US Congress, whilst facilitating Cuba's integration into the global economy.

"I think that the lifting of the travel ban is exactly right. The debate in the US today is about lifting the ban on ability of ordinary Americans to travel to Cuba and I see this as being the thread that if you pull it, it can unravel the whole sweater," Erikson added that travel to Cuba will lead to US business lobbying congress to lift the embargo. "The notion of tourists going to Cuba staying in Spanish and Canadian hotels driving around on Chinese buses. Only the food is American nothing else. This is going to get American business interested. And once you mobilise the US business community then you start to get some real political weight behind change beyond the intellectual arguments being made. So I think what we need to watch for is the vote on the travel ban."

Currently only Cuban-Americans can visit Cuba but they are fears that once the market fully opens to Americans that Jamaica will see a drop in its visitors. The government expects total arrivals to increase by 5.9 per cent in the 2009/10 fiscal year to 2.997 million. Of that amount it expects stopover arrivals to increase by 11.2 per cent to 2.02 million and cruise arrivals to increase by 3.2 per cent to 995,000. In the 2008/9 fiscal year, tourism earnings were estimated at US$1.99 billion.

Anne Crick, head of hospitality and tourism management at the University of the West Indies, Mona, yesterday stated that Jamaica may see a short-term reduction in hotel occupancy but that the strength of the product will offset any fallout.

"I think realistically that there will be a curiosity factor. So everyone will be interested in Cuba at first and I suspect that in the short-term there will be a fallout or displacement," Crick told the Business Observer, "but our product is sophisticated and we are positioning ourselves so that we have a fighting chance. And the players in the tourism sector were not watching this happen without planning. Some of them actually have operations in Cuba."

Fears are that the large hotels will cope better than small hotels - with 50 to 75 rooms. But Dr Crick stated that small hotels have more imminent challenges.

"For small properties I am not sure Cuba is a concern. There are many factors affecting the small hotels and many of them are local," said Crick, who is also the associated dean of social sciences. The threats she said included inefficiency, higher unit costs, renovation, access to financing and human resources.

In April, US President Barack Obama announced reduced travel restrictions for Cuban-Americans travelling to their home of heritage. In response, the Government of Jamaica and the Jamaica Hotel and Tourism Association (JHTA) said that Jamaica would benefit, as it would offer increased airlift and hotel expansion opportunities.

Any improvements in arrivals to Cuba represent an improvement in arrivals to the Caribbean noted John Lynch, director of tourism, in a statement at the time. "For the past year and a half, Jamaica has been in discussions with Cuba to explore the possibilities of dual destination strategies. Currently, flights already operate between Jamaica and Cuba."

Wayne Cummings, the JHTA president, noted that Jamaica can develop code-share arrangements to work with airlines that go to Cuba now that don't come to Jamaica. Continental Europe and Eastern Block countries that we wished we had here," he said.

Additionally, the Cuban tourism market is growing, offering Jamaican hoteliers investment opportunities.
In April, Obama had directed the Secretaries of State, Treasury, and Commerce to take the needed steps to:

. Lift all restrictions on transactions related to the travel of family members to Cuba;

. Remove restrictions on remittances to family members in Cuba;

. Authorise US telecommunications network providers to enter into agreements to establish fibre-optic cable and satellite telecommunications facilities linking the United States and Cuba;

. License US telecommunications service providers to enter into roaming service agreements with Cuba's telecommunications service providers;

. License US satellite radio and satellite television service providers to engage in transactions necessary to provide services to customers in Cuba;

. License persons subject to US jurisdiction to activate and pay US and third-country service providers for telecommunications, satellite radio and satellite television services provided to individuals in Cuba;

. Authorise the donation of certain consumer telecommunication devices without a licence; and

. Add certain humanitarian items to the list of items eligible for export through licensing exceptions.
The JHTA says that any fallout will be most felt by small hotels.

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