City Council Special Projects and Economic Development Committee May 12, 2009
How will changes to/elimination of the U.S. Embargo of Cuba impact Louisiana and New Orleans? Review the History of Louisiana/New Orleans - Cuba Relations Address the Economic Impact of Cuba- U.S. Trade and Exchanges on the Region
If New Orleans is the key to the American Midwest s access to the world, Cuba is the key to New Orleans.
Only 694 mi apart and, until 1962, located on the same centuries- old trade routes Steamship Routes of the World, 1900 (Map detail)
! Spain held Louisiana for only 2 generations (1762-1800). But this period! encompassed the American, French and Haitian revolutions! was when New Orleans became a port of importance! Spain left a deep imprint on Louisiana culture! The governor of Louisiana reported to the Spanish captain general in Cuba! Louisiana was governed by the same rules/practices as Cuba
Slavery was governed in NOLA the same as in Havana (very different from the U.S.)! Large population of free people of color (35-45%)! Slaves had the right to purchase their freedom! Domestic slaves could maintain families, had Sundays and holidays free! Slaves were allowed to play drums! Slaves brought in from different parts of Africa the Kongo! Free people of color served in the militia (including the bands)
! Constant travel and exchange between New Orleans and Havana as port activity increased through the 19 th c. 1787: 108 vessels; 41 bound for Havana 1798: 102 vessels, 63 bound for Havana 1812: the New Orleans is the first steamboat to reach the city 1840: 400 steamboats; NOLA was the fourth port in the world
! 1809: First major migration to New Orleans! Refugees from Saint Domingue, via Cuba! 9,000; 1/3 white, 1/3 slaves, 1/3 free people of color! Doubles the population of the city! Changes the racial/social mix of the city Hand- colored engraving by J. Laroque, in Jacques Grasset Saint- Sauveur, Encyclopédia des voyages, contenant l abrégé historique des moeurs, usages, habitudes domestiques, religions, fêtes.... (Paris, Deroy, 1796). Courtesy Louisiana State Museum.
! 1850: Narciso López raised the first U.S expedition to attempt to liberate Cuba from Spanish rule (bronze plaques in the 500 block of Poydras Street)! 1851: 2 nd López expedition leaves New Orleans 51 executed in Cuba; rioters in NOLA attacked the Spanish consulate and other property It is scarcely possible to resist the conviction that the annexation of Cuba to our federal republic will be indispensable to the continuance and integrity of the Union itself... There are laws of political as well as of physical gravitation; and if an apple severed by the tempest from its native tree cannot choose but fall to the ground, Cuba, forcibly disjoined from its own unnatural connection with Spain, and incapable of self- support, can gravitate only towards the North American Union, which by the same law of nature cannot cast her off from its bosom... - John Quincy Adams, 1823
! Musicians and entertainers (and rhythms) also traveled! Cuban and U.S. musicologists agree that these musical exchanges were crucial for the development of musical forms in both New Orleans (cakewalk, ragtime) and Cuba (danzas) that were precursors of later musical phenomena ( jazz ). Louis Gottschalk (1829-1969): Danse Cubaine (1860)
Spanish- American War Soldiers left from NOLA to join the fight, including the Onward Brass Band (on the USS Berlin) Jelly Roll Morton, circa 1930 And Beyond Onward Brass Brand, circa 1913 (Hogan Jazz Archive) Then we had Spanish people there. I heard a lot of Spanish tunes. I tried to play them in correct tempo, but I personally didn't believe they were perfected in the tempos. Now take La Paloma, which I transformed in New Orleans style. You leave the left hand just the same. The difference comes in the right hand - - in the syncopation, which gives it an entirely different color that really changes the color from red to blue. Now in one of my earliest tunes, "New Orleans Blues", you can notice the Spanish tinge. In fact, if you can't manage to put tinges of Spanish in your tunes, you will never be able to get the right seasoning, I call it, for jazz.
! Since the 1920s, Cuba became a popular tourist destination and New Orleans a favored port of departure for sea and cruise travel.
! App. 1/3 of all goods passing through the port of New Orleans were destined for Cuba! Cuba was Louisiana s number one trading partner in imports and seventh in exports! Main imports: sugar, molasses, vegetable fiber, fruit, and pigment paints & varnishes! Main Exports: flour, chemicals, grain, vegetables, animal feed and lumber! More than 6,000 Louisianans were employed in Cuba- related commerce Robins & Trujillo, Normalized Trade Relations Between the United States and Cuba. Cuba in Transition, ASCE, 1999.
Of Future Cuba- U.S. Trade in Louisiana and New Orleans
! Recent changes impact only the provisions governing family- travel and remittances and trade in telecommunication and computers (unlikely to impact Louisiana).! U.S. food sales to Cuba are allowed, but financial institutions cannot provide credits for such transactions! Cuba must pay cash or obtain financing through third- country banks
! GDP (Gross Domestic Product)! 2007: 7.3%! 2008: 4.3%! Total Exports in 08:! $3.7 billion; slight decrease since 07! Total Imports in 08:! $14.2 billion; 41.3% increase since 07 ($10 billion): impact of hurricanes Ike & Gustav! Tourism in 08: 2.3 m visitors in 08; increase of 9%
Cuba s GDP, 1989-2008 (Annual Growth Rates) 15 percentage change 10 5 0-5 0.7-2.9 0.7 2.5 7.8 2.7 0.2 6.3 5.8 3.2 1.4 3.8 5.8 "Sustainable social" GDP 11.2 12.1 7.3 4.3-10 -10.7-11.6-15 -14.9-20 1989 1990 1991 1992 1993 1994 1995 1996 1997 1998 1999 2000 2001 2002 2003 2004 2005 2006 2007 2008 Sustainable Social GDP Formula: Recognizes value added of subsidized social services (healthcare, education, sports) provided by the Cuban state to its population and to citizens from other countries, mainly from Venezuela. Source: Oficina Nacional de Estadísticas (ONE), 2009
Source: Oficina Nacional de Estadísticas (ONE), 2009
! The U.S. market share of Cuba s agricultural imports is app. 33% ($690m; up 60% from 2007)! Primarily bulk commodities such as wheat, corn, rice and soybeans! Louisiana s share of this trade has increased steadily since 2006: 2006 2007 2008 $140.5 $173.3 $256.2 Source: U.S. Census Bureau, Foreign Trade Division
! It is unlikely that the embargo will be lifted in one fell swoop.! A gradual easing is more likely:! Removal of financial restrictions for U.S. food sales! Lifting of the travel ban for all U.S. citizens (www.opencuba.org)! Complete normalization (investment and non- agricultural trade restrictions eliminated)
! Short Term (lifting of financial restrictions on agricultural trade):! Increased agricultural trade (rice and other products) Currently Cuba imports rice from Vietnam; safe to assume that they would prefer Louisiana (better quality and lower transportation costs)! Increased port activity in New Orleans! If other restrictions are lifted, possibility of exporting fertilizers (currently, LA exports more than $400m per year)! Small business possibilities?
! Short/Medium Term (lifting of travel ban)! More agricultural trade and Port of New Orleans activity because of huge flow of U.S. tourists (increasing demand for food)! Cruise tourism? Politically sensitive and frowned upon in Cuba (only 10,000 cruise tourists in 2007) Torricelli Law (1992) prohibits ships which dock in Cuban ports to dock in the U.S. for at least 180 days.
! Medium/Long Term (complete lifting of embargo)! Potential for Louisiana- based oil companies: off- shore activities in the Gulf of Mexico & refining! Sales of other products: electric machinery, vehicles and parts, farming/construction equipment! Key: availability of credit lines for financing (why Cuba trades with China, Venezuela, Russia & Brazil)
! A 2001 Texas A&M study indicated that were the embargo to be lifted entirely, the state of Louisiana would be the among the biggest winners in terms of overall economic impact and trade! But Alabama, Mississippi and Texas are eager to compete for Cuban trade and lobbying and ramping up for it (http://www.latimes.com/ news/nationworld/nation/la- na- alabama- cuba7-2009may07,0,457767.story)
Ana M. López Director, Cuban and Caribbean Studies Institute Tulane University Caroline Richardson Hall New Orleans, LA 70118 (504) 865-5261 lopez@tulane.edu