The United States has imposed embargo on Cuba for almost 40 years now. Bill Clinton signed the Helms-Burton Act in 1996 and this move was taken to restrict the trade relations between America and Cuba. It seeks to deny visa to anyone who has done business with American property that was confiscated during the Cuban Revolution in 1959. It also provides the American citizens with the right to file lawsuits in domestic courts for the financial compensation for their confiscated property.
The embargo on trade relations could not be lifted or relaxed by any US president unless there was a transition in the Cuban regime. The Helms-Burton law was opposed strongly by the European Union and countries of Canada and Mexico. They felt that Cuba provided them with great trade potential and the United States had no right to impose their foreign policy on other countries by invoking sanctions against others who wished to promote their business interests in Cuba. This is more evident with the rapid changes that are taking place in the Cuban economy in the recent years.
The European Union feels that the Cuban economy presents extensive business opportunities and the penalizing of the foreign companies that are promoting business in Cuba by the United States is not only unjust but also unethical. The matter was taken to the World Trade Organization (WTO) that set up a judicial panel to resolve the conflict. European Union charged the United States with violating international law by imposing sanctions on foreign companies for promoting trade relations with Cuba.
The United States however refused to comply with the panel investigation claiming that the WTO was not competent enough to review the US foreign policy interests. The stance taken by the United States posed a threat to the credibility of the WTO since the legislation exempts WTO nations from entering into trade agreements in case of national security. If United States claims that its relations with Cuba are a matter of national security, it would be exempt from any trade agreements of the WTO.
In view of these proceedings the European Union decided to suspend its charges and the United States President agreed to reach a mutual understanding on the Helms-Burton issue. Trade Embargo and their implications Globalization and liberalization of markets has added new dimension to the international trade scenario. Foreign investments and trade mark the development of a nation. Trade embargo restricts exports and imports of all items to and from another country.
These embargos are generally placed for political reasons and can have deep impact on the economy of the particular country. Such measures are adopted to harm the economy of another nation towards accomplishment of political ends. The Helms-Burton law is one such instance that was adopted by the United States to denounce Fidel Castro and his political regime. United States made all efforts using this embargo to weaken the Cuban economy but the country has shown remarkable progress in foreign trade and investments.
The tremendous potential that the Cuban economy presents has attracted investments from other countries like European Union, Canada and Mexico. These nations have reaped benefits from investment in Cuba over the years. The United States opposed this measure by invoking sanctions against any foreign companies that had business interests in Cuba. The European Union and Canada strongly protested against this move by the United States and the issue was taken to the WTO panel for settlement. Most countries did not appreciate the American high-handedness.
The American business groups too felt that that they were losing out on the profitable ventures in the Cuban soil. Most of them felt that the embargo was not in their interests and should be lifted since the opportunities in the Cuban soil was being reaped by other nations of European Union and Canada. The loss was for the Americans since the Cuban economy survived and flourished despite all odds against them. They managed to create a self-sustained economy without the aid of United States and the trade embargo.