Obama and Raúl Castro shake hands, herald new era in relations

President Barack Obama and Cuba's Raúl Castro have heralded a new era of U.S.-Cuban relations as they both addressed a landmark Summit of the Americas ahead of historic one-on-one talks.

Sitting around an oval table with some 30 other regional leaders in Panama City, Obama and Castro spoke one after the other on Saturday, in an unprecedented public exchange between the leaders of the Cold War–era foes.

"This shift in US policy represents a turning point for our entire region," Obama said. "The fact that President Castro and I are both sitting here today marks a historic occasion." 

Obama said that while differences between US and Cuba will remain, "If we continue to move forward and seize this momentum, in pursuit of mutual interests, then better relations between the United States and Cuba will create new opportunities for cooperation across the region."

In response, Castro said that "it was good" that the Obama administration "is not trapped in the ideology of the past."

But he also said that he will not allow Cuba "to be colonized again" and that his country will not be "bought off."

As he praised Obama as "an honest man", Castro said "every US president before him is to blame" for making Cuba suffer under U.S. blockade. 

A day after exchanging handshakes, the two leaders will take another step to repair severed ties by holding a private meeting on the sidelines of the second and final day of the summit.

The meeting between Obama and Castro is expected after the group session, when leaders take a break for lunch.

The meeting is not formally on the schedule of events in the summit.

There are expectations that Obama will use the meeting to announce his decision to remove Cuba from the U.S. list of state sponsors of terrorism. On Thursday he suggested an announcement was imminent when he said that the State Department's lengthy review of the designation was finally complete.

Cuba has eagerly sought that move, and Cubans are hoping that their economy will benefit from the decision.

The US has long ago stopped accusing Cuba of conducting terrorism, and Obama has indicated that he is ready to take Cuba off the list.

Mending ties with Cuba could form a cornerstone in the foreign policy legacy for Obama, with Latin America a rare bright spot for the president.

Obama and Castro shook hands once before, at the funeral of South African President Nelson Mandela, but expectations are higher now, after Obama's decision in December to begin talks on restoring relations with Cuba, which were severed in 1961.

Al Jazeera and wire services