North Carolina Journal of International Law

"Connecting North Carolina to the World of International Law"

President Trump’s Cuba Policy

By: Leigh Edwards

After President Trump was elected into office, a Pentagon memo seemed to confirm that for the incoming Trump administration, U.S. sanctions and national security were going to be central issues.[1]  In June 2017, after publicly announcing a possible rollback of the easing of sanctions involving Cuba by the Obama Administration, it was confirmed that the Trump Administration was poised to make potentially significant changes.[2]  However, what remained unclear was just how significant they would be, who they would impact, how long they could last, and if “the days of drinking Havana Club rum in Havana club” would soon be over.[3]


On December 17, 2014, President Obama announced a historical shift in U.S. policy toward Cuba and pledged that the United States (“U.S.”) would reestablish diplomatic relations and ease certain aspects of it decades long trade embargo against Cuba.[4]  Shortly thereafter, the Treasury’s Office of Foreign Assets Control (“OFAC”) and the Department of Commerce’s Bureau of Industry and Security (“BIS”), issued a series of amendments to the Cuban Asset Control Regulations and Export Administration Regulations.[5]  Although the embargo was still in place, these amendments significantly expanded amount of legal trade between Cuba and the U.S.[6]  For example, it permitted U.S. citizens to travel more freely to Cuba under certain circumstances, provide certain services to Cuba, and transact business with Cuban nationals, including financial institutions.[7]


During the 2016 Republican presidential primaries, Mr. Trump stated, “all of the concessions Barack Obama has granted the Castro regime were done through executive order, which means the next president can reverse them, and I will do just that unless the Castro regime meets our demands.”[8]  President Trump meant that, it would be perfectly legal for him to issue new executive orders that revoked the Obama executive orders.[9]  One month later, it became clear that these demands had not been met when Vice President Pence tweeted that the Trump administration would “repeal Obama’s Executive Orders on Cuba & continue the embargo until there [was] real political and religious freedom.”[10]  However, because President Trump’s policy statements did not detail what demands Cuba would have to meet for Obama’s Administration executive orders to remain in place, it was difficult to predict how U.S. and international companies would be affected.[11]

President Trump Revises U.S. Policy on Cuba

On June 17, 2017, President Trump announced a new set of restrictive revisions to U.S. policy toward engagement with Cuba, restating the importance of the 56-year-old trade embargo with the island.[12]  The changes, which include a rollback of former President Barack Obama’s accord with Cuba that eased the U.S. embargo, took effect on November 9, when the regulations were published in the Federal Register.[13]


President Trump introduced a new Cuba Policy because of politics, not business.[14]  The Trump administration says its goal is to put an end to business transactions that financially benefit the Castro regime.[15]  “My administration’s policy will be guided by key U.S. national security interests and solidarity with the Cuban people,” the draft of the five-point, eight-page Presidential Policy Directive reads.[16]  The policy aims to accomplish its goal by weakening the Cuban state by depriving the Cuban Military, intelligence forces security services, and intelligence forces, including, in particular, the Cuban military monopoly, Group de Adminstracion Empresarial (“GAESA”).[17]  Instead, according to officials, U.S. dollars will be sent to Cuba’s small-scale private businesses, certain categories of travel, and commercial activities in certain sectors to further open the island’s economy.[18]

Similarities to Obama’s Cuba Policy

“I am canceling the last administration’s one-side deal with Cuba,” said Trump.[19]  Despite the fact that Trump said he was “completely” canceling Obama’s Cuba policy the change is only a “partial shift from Obama’s policy.”  The new rules, which went into effect earlier this November, left in place most of the sanctions relief effected by the former Obama Administration.[20]  For example, diplomatic relations between the U.S. and Cuba will remain open, as will embassies in Washington and Havana.[21]  Further, direct commercial flights and cruises will still be operated, travelers will still be able to spend unlimited amounts of money on the island, and Americans will continue to be permitted to send unlimited amounts of money to Cubans on the island.[22]  According to the Washington Post, the economic embargo on Cuba, which Obama was unable to repeal by executive order because it requires a vote by the Senate, also remains in place.[23]

Changes: Adding Difficulties

Under the new policy changes, Americans (or, more precisely, “persons subject to U.S. jurisdiction”) will only be allowed to travel to Cuba as part of groups licensed by the U.S. Treasury Department as traveling for specific purposes.  In addition, Americans are prohibited from engaging in certain direct financial transactions with the 180 businesses on the State Department’s Cuba Restrictive List – including holding companies, the eighty-three hotels throughout the island, marinas, and stores.[24]  In developing its Cuba Restrictive List, which will be updated periodically, the State identified entities that were owned by or directly benefit the Cuban military.[25]  Businesses will also be restricted from engaging with the 180 entities on the State Department list.  However, there is good news for a few travelers and businesses: the new regulations will not impact some travelers and businesses that had already begun transactions with Cuba.[26]  For example, individuals who have already purchased airline tickets will still be permitted to travel.[27]


The potential effects of such a move on Cuba’s tourism industry would be significant.[28] However, James William, president of Engage Cuba, a coalition of private companies working to end travel and trade embargos on Cuba, argues that these new regulations on U.S. companies will have a multi-billion dollar impact on the U.S. economy because it makes it harder to do business in Cuba.[29]  He explained that “[g]iven the intertwinement of Cuba’s economy, these new restrictions on U.S. business could hinder that progress, which could cost the U.S. economy billions and affect thousands of jobs.”[30]  However, according to Gustavo Arnavat, a senior adviser at a D.C.-based think tank, the latest Cuban policy appears to still permit controlled entities, including American companies and individuals, to do business with the Cuban Government. [31]  Further, the one positive aspect of the new policy is it lessens the uncertainty on the U.S. approach to Cuba.[32]  Arnavat explained that now “[w]e know in terms of regulations what the limits are” and that “[w]e at least [have] a basic understanding of the contours of the new policy,” whereas before his June 2017 speech, “they definitely did not know which way he was going.”[33]

Diplomatic Relations and the Future of Trump’s Cuba Policy

During the Obama Administration, former President Obama spent the last two years of his presidency looking to end the hostility and mistrust that had long characterized relations between countries ninety miles apart from each other.[34]  In light of this thawing, the latest actions by the Trump administration create further anxiety that it could cool the U.S.’s relations with Cuba again.[35]  However, the visible impact will not be clear until the “U.S. fleshes out the new policy,” said the Wharton School of Business.[36]  As discussed above, the president, who kept diplomatic ties open with Cuba, announced that any further improvements in relations with Cuba will be contingent on concrete steps by the Cuban government to “improve[s] the lives of the Cuban people,” including measures to protect human rights, the release of political prisoners, free elections, and the legalization of political parties. [37]  In light of President Trump’s statements, some observers believe that “Trump’s policy is likely to be perceived by Cubans as the latest incident in a long history of U.S. aggression against the island, whose ultimate victims have been Cuban people.”[38]  Additionally, the BBC reported that the announced changes indicate that it seems highly likely the embargo will stay in place for the next four years.[39]


Despite this, President Trump has kept the U.S. Embassy’s lights on and has kept Cuba off a list of state sponsors of terror.[40]  In a speech in Miami in June, the President explained that he is keeping the embassy open “in the hope that our countries can forge a much stronger and better path.”[41] As a result, the Cuban government, including Cuban President Raul Castor, signaled a willingness to negotiate with Trump.  “We know they have a different view of the world . . . [w]e understand that,” a Cuban official told CNN.  At the time, many of the president’s most critical opponents held out hope that diplomatic relations would continue, ensure a stable relationship, and lead to another easing of the Cuban embargo.


However, in August, following reports of rekindled aggression among diplomats, relations have again deteriorated between the U.S. and Cuba.[42]  As both sides are growing increasingly frustrated, one Cuban official told the New York Times “it appears there is no longer trust between the two governments.”[43]  Kavulich believes the Trump administration may well “make an issue” of trying to settle U.S. claims of compensation from the Cuban government over its expropriation and nationalisation policies in the 1960s.[44] Consequently, the future for U.S. and Cuba diplomacy remains uncertain.  However, what does seem to be clear is that the further easing of the Cuban embargo in the near term is unlikely.  Fortunately, according to Kavulich, for U.S. companies already doing business there, “it’s not that tremendously impactful. It has a political optic. It creates anxiety, but is any U.S. company being required to stop doing what they were doing? The answer is no.”[45]


[1] See John Hudson et. al, Russia Missing from Trump’s Top Defense Priorities, According to DoD Memo, The FP Group (Dec. 20, 2016 12:44 PM)

[2] See Julie Hirschfeld Davis, Trump Revises Pieces of Obama Era Engagement with Cuba, The New York Times (June 16, 2017)

[3] Marc Caputo & Daniel Ducassi, Trump to Clamp Down on Cuba Travel and Trade, Politico, (June 15, 2017, 1:34 PM)

[4] Peter Baker, U.S. to Restore Full Relations with Cuba, Erasing a Last Trace of Cold War Hostility, The New York Times (Dec. 14, 2014)

[5] Mark P. Sullivan, Cong. Research Serv., RL31139, Cuba: U.S. Restrictions on Travel and Remittances 7-5700 (2017).

[6] See Caputo & Ducassi, supra note 3.

[7] Id.

[8] See Marco Caputo, In Miami, Trump morphs back into a Cuba hardliner, Politico (Sept. 16, 2016, 9:24 PM)

[9] See Sullivan, supra note 5.

[10] Julian Border, Trump unlikely to reinstate embargo after death of Fidel Castro, analysts say, The Guardian (Nov. 26, 2017 8:25 PM)

[11] See Id.

[12] See Caputo & Ducassi, supra note 3.

[13] See Cherly Bolen, Stringent Cuba Regulations Released, Int’l Trade Daily (BNA), No. 34 (Nov. 16, 2017).

[14] Martin Kunovic, Five Things You Need to Know About Trump’s Cuba Policy – and Who it Will Hurt, The Washington Post (June 22, 2017)

[15] See Caputo & Ducassi, supra note 3.

[16] See Caputo & Ducassi, supra note 3.

[17] See Id.

[18] Changes to U.S.-Cuba Policy: What’s the Real Impact? Gustavo Arnavat and John S. Kavulich discuss the recent changes to U.S. policy on trade with Cuba, Knowledge@Wharton (Nov. 14, 2017) [hereinafter Wharton].

[19] See Kunovic, supra note 14.

[20] Dan Merica, Trump Unveils New Restrictions on Travel, Business with Cuba, CNN (June 17, 2017 2:00 pm)

[21] Id.

[22] See Kunovic, supra note 14.

[23] Id.

[24] See Wharton, supra note 18.

[25] Id.

[26] Id.

[27] Id.

[28] Will Grant, Trump’s New Cuba Policy: What’s at stake for the Island?, BBC News (June 10, 2017)

[29] See Bolen, supra note 13.

[30] Id.

[31] Id.

[32] See Wharton, supra note 18.

[33] Id.

[34] See Melanie Zanona, How Trump is Reshaping US Policy on Cuba, The Hill (Nov. 19, 2017 8:00 AM)

[35] Id.

[36] See Wharton, supra note 18.

[37] See Merica, supra note 20.

[38] See Kunovic, supra note 14.

[39] See Grant, supra note 28.

[40] See Zanona, supra note 34.

[41] See Merica, supra note 20.

[42] Gardiner Harris, Trump Tightens Cuba Embargo, Restricting Access to Hotels and Businesses, The New York Times (Nov. 8, 2017)

[43] Id.

[44] See Grant, supra note 28.

[45] See Wharton, supra note 18.



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