How new US policy will change relations with Cuba

The United States embargo has dominated relations between Cuba and its northern neighbor since 1961, but that may change with Wednesday’s announcement that the two countries will begin diplomatic talks with the goal of normalizing relations. While day-to-day life for Cubans may not see a dramatic transformation soon, here’s a look at the big-picture changes in store.

Prisoner swap

The central piece of Wednesday's deal was the freeing of U.S. citizen Alan Gross on humanitarian grounds, along with an unidentified U.S. intelligence officer held for two decades in Cuba. They were allowed to return to the U.S. in exchange for the three remaining prisoners from the Cuban Five, who were arrested in 1998 and convicted by the U.S. of conspiracy to commit espionage. 

Diplomatic upgrade

The U.S. has long maintained an “interests” section in a free-standing building in Havana across from the famous Malecón seafront promenade. Under the new policy, the building will be upgraded back to embassy status, and high-level diplomatic contacts will resume. 

Looser travel policies

The White House had relaxed travel policies for Cuban-Americans, certain professional groups and people-to-people cultural tours. The new policy will allow expanded travel under general licenses — including family visits, journalistic activity, academic exchanges, religious missions, humanitarian projects and other types of professional travel. Licensed travelers will be permitted to import $400 worth of items from Cuba, including up to $100 worth of alcohol and tobacco products, such as Cuban rum and cigars, for personal use. Commercial imports will remain restricted. Travelers will be allowed to use U.S. credit and debit cards while they are traveling.

Better Internet access in Cuba

Only 5 percent of Cubans have access to the Internet, partly because of the U.S. embargo and partly because of local restrictions. In the last few years, more Cubans have been able to use the Internet at cafes, although at very slow speeds. The new policy aims to facilitate better telecommunication links from Cuba to the U.S. and other countries.

More remittances to Cuba

The diplomatic reset will raise the cap on remittances from the U.S. to Cuba to $2,000, from $500, every three months. Cubans abroad send home more than $2.5 billion in cash per year. Those funds are a significant source of foreign currency for the country, about equivalent to annual tourism revenue.

Doing business gets easier

Previously, the U.S. government allowed limited business transactions with Cuba, whose biggest trade partners include Canada, Venezuela, China and Spain. The new rules will make it easier for U.S. companies to sell building materials for home construction, goods for small businesses and agricultural equipment for farmers. And the deal will make it easier to arrange financial transactions to Cuba through third countries.

Tighter cooperation on drugs, the environment

The U.S. and Cuba will begin strengthening cooperation on issues such as immigration, drugs and the environment, with the Treasury and Commerce departments amending decades-old regulations on currency use and trade.

Ships

Foreign companies have long complained of U.S. government rules that penalize ships that previously docked in Cuba. Under the new policy, some of these vessels will be permitted to enter the U.S.

Review of ‘state sponsor of terrorism’ designation

Cuba was designated in 1982 as a state sponsor of terrorism, although the State Department is expected to initiate a review process that could lead to the country’s removal from the list. In addition, the U.S. will not object to Cuba’s participation in next year’s Summit of the Americas in Panama.