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$ Cong essional Research Service
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Updated August 30, 2019
Cuba: U.S. Policy Overview
Since the early 1960s, when the United States imposed a
trade embargo on Cuba, the centerpiece of U.S. policy
toward Cuba has consisted of economic sanctions aimed at
isolating the government.
In December 2014, the Obama Administration initiated a
major policy shift moving away from sanctions toward
engagement and the normalization of relations. The policy
change included the rescission of Cuba's designation as a
state sponsor of international terrorism in May 2015; the
restoration of diplomatic relations in July 2015; and efforts
to increase travel, commerce, and the flow of information to
Cuba by easing restrictions on travel, remittances, trade,
telecommunications, and banking and financial services
(accomplished through amendments in 2015 and 2016 to
the Cuban Assets Control Regulations [CACR],
administered by the Department of the Treasury, and the
Export Administration Regulations [EAR], administered by
the Commerce Department). The restoration of relations led
to increased government-to-government engagement, with
over 20 bilateral agreements negotiated and bilateral
dialogues conducted in numerous areas of cooperation.
President Trump unveiled a new policy toward Cuba in
2017 introducing new sanctions and rolling back some of
the Obama Administration's efforts to normalize relations.
In 2019, the Administration has increased economic
sanctions significantly to pressure the Cuban government
on its human rights record and its support for the regime of
Nicolfs Maduro in Venezuela. These include actions
allowing lawsuits to go forward against those trafficking in
property confiscated by the Cuban government and
tightening restrictions on nonfamily travel to Cuba,
including the termination of cruise ship travel to Cuba from
the United States. With these actions, U.S. policy toward
Cuba has again shifted to a policy of strong economic
pressure. In response to the increased sanctions, Cuban
President Miguel Dfaz-Canel asserted We Cubans do not
surrender.
Cuban Political Developments. In April 2018, Dfaz-
Canel, who was serving as first vice president, succeeded
Rafil Castro as president, but Castro continues to head the
Cuban Communist Party until 2021. The selection of Dfaz-
Canel, now 59 years old, reflects the generational change in
Cuban leadership that began several years ago and marks
the first time since the 1959 Cuban revolution that a Castro
is not in charge of the government. While in power from
2006 to 2018, Rafil Castro began to implement significant
economic policy changes, moving toward a more mixed
economy with a stronger private sector, but his
government's slow, gradualist approach did not produce
major improvements to the Cuban economy, which has
experienced minimal growth in recent years.
In December 2018, President Dfaz-Canel backtracked on
implementing regulations that likely would have shrunk the
private sector and slowed implementation of a controversial
decree regulating artistic expression, actions that appeared
to demonstrate responsiveness to public criticism and
independence from the previous government. Dfaz-Canel
continues to faces two significant challenges-moving
forward with economic reforms that produce results and
responding to citizens' desires for greater freedom.
In February 2019, almost 87% of Cubans approved a new
constitution in a national referendum. Among the changes
are the addition of an appointed prime minister to oversee
government operations; age and term limits on the
president; and some market-oriented economic reforms,
including the right to private property and the promotion of
foreign investment. However, the new constitution ensures
the state sector's dominance over the economy and the
predominant role of the Communist Party.
The Cuban economy is being hit hard by the increase in
U.S. sanctions and by Venezuela's economic crisis, which
has limited Venezuela's financial support to Cuba. The
Cuban government reported that, as of July 2019, tourism
arrivals had dropped by almost 24% compared to the
previous year, hurting many restaurant and other private
sector businesses supporting the tourist sector. The
Economist Intelligence Unit forecasts that the economy will
grow 0.6% in 2019 but contract by 0.2% in 2020.
Trump Administration Sanctions. President Trump
issued a national security presidential memorandum on
Cuba in June 2017 that introduced new sanctions. These
included restrictions on transactions with companies
controlled by the Cuban military, and the elimination of
people-to-people travel for individuals. To implement these
changes, the Treasury and Commerce Departments
amended the CACR and EAR in November 2017.
The Department of State issued a list of restricted entities
in November 2017; it has been updated several times, most
recently in July 2019. The list currently includes 218
entities and subentities, including 2 ministries, 5 holding
companies and 49 of their subentities, 104 hotels, 2 tourist
agencies, 5 marinas, 10 stores in Old Havana, and 41
entities serving the defense and security sectors.
In April and May 2019, the Department of the Treasury
imposed sanctions on eight shipping companies and seven
vessels that have transported Venezuelan oil to Cuba (39
other vessels transporting Venezuelan oil were sanctioned).
Venezuela currently provides some 40,000-50,000 barrels
of oil per day to Cuba, about one-third of its consumption.
On April 8, 2019, the Department of the Treasury scuttled
an agreement between Major League Baseball and the
Cuban Baseball Federation, announced in December 2018,
which would have allowed Cuban baseball players to sign
with U.S. teams directly. Trump Administration officials
maintained that the Cuban Baseball Federation is part of the
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