More than 120 years ago, Winston Churchill sailed to Cuba. While there, he dreamt of a country ‘free and prosperous…throwing open her ports to the commerce of the world, sending her ponies to Hurlingham and her cricketers to Lords.’ Now, in spite of Cuba’s communist revolution, the British government seems to have the same optimistic view as Churchill. But is it right to do so?
On Sunday, the Prince of Wales and the Duchess of Cornwall landed in Havana. Their tour is the first official royal appointment in Cuba, a four-day trip the British government hopes will strengthen economic and diplomatic relations with the communist country. The royal trip may be historic, but no matter how you spin it, commercially, it is a complete waste of time. British GDP is 3,000 times larger than Cuba’s and our economies are almost incomparable. The UK has a modern, services-based economy; Cuba relies on exporting doctors to its allies, importing bargain-price oil from Venezuela, remittances from families abroad and international tourism. The Cuban state and the military closely oversee enterprise, and a fledging private sector is subject to continuous regulatory uncertainty.
Presumably the British government believes the relative liberalisation of the Cuban economy, a process that began during Raúl Castro’s presidency (2008-18), is an opportunity for British businesses. Yet while there is potential for collaboration in sectors such as technology (the highest estimates suggest 40 per cent of Cubans are online, compared to 82 per cent of Brits), the commercial environment in Cuba is far from ready for major foreign investment. Cuba remains a labyrinthine bureaucracy; and despite a fresh-faced president – Miguel Díaz-Canel is 58 –geriatric Communist party grandees remain sceptical of reform.
If there is little commercial upside to forging closer ties with Cuba, in other areas there are major downsides.