ECONOMIC BENEFITS OF LIFTING U.S. SANCTIONS ON CUBA
ECONOMIC BENEFITS OF LIFTING U.S. SANCTIONS ON CUBA FOR THE U.S. ECONOMY Prepared by Tim Lynch, Ph.D., Director & Necati Aydin, Research Associate Center for Economic Forecasting and Analysis (CEFA) Florida State University www.cefa.fsu.edu Presented at Caribbean Studies Association 28th Annual Conference Belize City, Belize May 2631, 2003
CUBAN ECONOMIC HISTORY: BEFORE THE SOCIALIST REGIME Before 1959 the U.S. was Cubas main trading partner. Florida was Cubas largest U.S. state trade partner. 40 percent of all cargo being routed through Miamis customs district was transported to Cuba. 85 percent of Cubas exports were
transported to the United States. IMPACT OF FREE TRADE WITH CUBA IN THE U.S. ECONOMY Cuba is the largest and most economically viable of the Caribbean nations. Its wealth of underutilized natural and human resources makes it an ideal economic trading partner for the U.S. For example the U.S.-Cuba Business Council estimated initial Cuban infrastructure needs of: $500 million investment in telecommunications.
$500 million in mass transit. $575 million in airports. $540 million in railroads. IMPACT OF FREE TRADE WITH CUBA IN THE FLORIDA ECONOMY Economic reforms in Cuba since the 1990s towards a more open market system will generate considerable business opportunities for the Florida economy (assuming these trends continue). Gravity theory suggests that Florida has more advantages than any other state to benefit from
trade liberalization with Cuba. Lifting sanctions would result in Florida (and the U.S.) adding approximately 11 million additional customers just 90 miles from Floridas shores. RECENT ECONOMIC IMPACT STUDIES Embargo costs the U.S. between $3 and $4 billion in lost exports per year. (Preeg, Center for Strategic and International Studies, 1998.)
Lifting sanctions on agricultural exports to Cuba for the 50 states and 22 commodity sectors, will result in increases in exports of $1.2 billion per year. (Rosson and Adcock, Texas A&M University, 2001) Such increase in exports would stimulate an additional $3.6 billion in total economic output and 31,262 new jobs in the U.S. labor market. (Ibid,Rosson, 2001) TRADE SANCTIONS REFORM AND EXPORT ENHANCEMENT ACT OF 2000
Allows for U.S. food and medical exports to Cuba under certain conditions. In its first year of implementation, the U.S. exports to Cuba rose by a factor of 20. U.S. Export to Cuba (Millions dollar) 160 144.4
140 120 Export 100 80 60 40 20 1.2 2.5
4.6 5.6 5.5 9.5 3.5 4.5 6.9 7.1 0
1992 1994 1996 1998 Years Source: USA Trade Online, U.S. Census Bureau, 2002 2000 2002 EXAMPLES OF NEIGHBORING NATIONAL PERCENTAGE OF EXPORT AND IMPORT
TO GDP (2002) THE ESTIMATION OF THE IMPACT OF FREE TRADE WITH CUBA OLD ECONOMY WITH RESTRICTED TRADE People Productivity Low cost production Strong economy Capit al
Entrepreneurs Profits Goods Services NEW ECONOMY WITH FREE TRADE Higher productivity Higher wages Higher quality of life People Capital
More resilient economy Higher efficiency Higher wealth Higher profits Entrepreneurs Goods Services FORECAST POSSIBLE US-CUBA 10 YEAR GROWTH IN TRADE (2003$) $8.01 $7.61
$2.89 $1.60 $0.00 Im ports Exports FORECAST POSSIBLE US-CUBA 35 YEAR GROWTH IN TRADE (2003$) DESCRIPTION OF FSU CUBA RESEARCH USING THE REMI MODEL REMI, 2000 (REMI, 2000) is a widely accepted
and used dynamic integrated input-output and econometric model. REMI is the most sophisticated and widely used economic impact assessment tool currently available in the US. REMI is extensively used by US public and private agencies, business and Universities to evaluate the economic impact of pending complex federal, state and local policy actions. THE 10 YEAR IMPACT OF FREE TRADE WITH CUBA ON THE U.S. GDP (2003$)
THE 35 YEAR IMPACT OF FREE TRADE WITH CUBA ON THE U.S. GDP (2003$) THE 35 YEAR ECONOMIC BENEFITS TO FLORIDA ECONOMY FROM LIFTING THE BAN OF TRAVEL TO CUBA (2003$) Source: The Impact on the U.S. Economy of Lifting Restrictions on Travel to Cuba, Center for International Policy Study, July 15, 2002. THE 35 YEAR JOB IMPACT OF LIFTING TOURIST TRAVEL BAN TO CUBA ON FLORIDA EMPLOYMENT (2003$) Source: The Impact on the U.S. Economy of Lifting Restrictions on Travel to Cuba,
Center for International Policy Study, July 15, 2002. SUMMARY OF FINDINGS (For The U.S. Economy) Normalization of trade between Cuba and the US will result in: $5 to $15 billion imports and exports over 10 years $1.3 to $3.4 billion increase in U.S. GDP over 10 years $62 to $307 billion increase in U.S.
imports and exports over 35 years $14 to $68 billion dollars increase in U.S. GDP over 35 years SUMMARY OF FINDINGS (For The Florida Economy) The lifting restrictions on travel to Cuba will result in potential tourism increases alone of: $1.1 to $2.1 billion growth in Florida GDP over 35 years 14,000 to 27,372 new jobs in Florida over 35 years
Yes No Devices for Safety Mirrors Inside mirror - shows directly behind the vehicle Outside mirrors - show to the right and left behind the vehicle Even with properly adjusted mirrors there will still be blind spots Getting Ready to...
Targets for this Workshop. I can use a variety of instructional strategies in order to effectively differentiate instruction. This seems simple enough, but surprisingly enough many educators are so determined to "get through" the curriculum that they neglect the more...
Identify that the relativity of space and time has to do with transferring measurements between two inertial frames in relative motion but we still can use classical kinematics and Newtonian mechanics within a frame. 37.05
Finance 30210: Managerial Economics Demand Forecasting Finance 30210: Managerial Economics Demand Forecasting Suppose that you work for a local power company. You have been asked to forecast energy demand for the upcoming year.
Introduction to the Teacher Effectiveness Enhancement Programme (TEEP) In this session: Why TEEP for (add school) Overview of the TEEP model Format of the training "TEEP provides a holistic framework that goes far beyond a lesson planning tool.
To make a peanut butter and banana sandwich, you need a . combination. of peanut butter, bananas, and bread. ... A cloth worn around the head. Example ... - Is looking at a bug with your eyes closed a good...
Slide 3 Product-Service Continuum Product is a bundle of benefits Types of Products Consumer, Business Consumer Products Consumer Products Consumer Products Consumer Products Product Line & Product Mix Item Product Line Benefits of Product Lines Product Mix Product Depth Product...
Ready to download the document? Go ahead and hit continue!