HAVANA – From bus drivers to bartenders and ballet dancers, many Cubans are already imagining a more prosperous future after the United States said it will put an end to 50 years of conflict with the communist-run island.
News of the historic shift echoed quickly through the Spanish colonial plazas of Old Havana, where strains of trova and son rose from outdoor cafes, Cuban music that is a siren song for foreign tourists.
From the plaza outside Havana’s 18th century cathedral, Daniel Guillen, 53, makes a living directing tourists to a nearby cafe, and he knows a flood of U.S. tourists would pump money into the area.
“More yumas mean more consumption,” he said, using a nickname for Americans. “More consumption means more money. More money generates a better life.”
Old Havana is a center of Cuba’s tourism industry and boasts fine colonial buildings, some exquisitely restored but others in disrepair. It’s an open secret that investors and developers hope one day to buy and fix up some of those homes as well as others across Havana.
Cubans have been allowed to buy and sell homes only since November 2011, drawing some speculators and many Cuban-Americans looking to return to their homeland, at least part time. But many believe the nascent property market could boom.
Milly Diaz, of Havana-based Cuba Homes Direct, said on Thursday she had received a flood of inquiries since U.S. President Barack Obama announced on Wednesday that his administration would normalize relations with Cuba
“We are anticipating an influx of foreign buyers as the smart money sees Cuba and Havana as a market with huge potential upside,” Diaz said.
Foreigners are still banned by the Cuban government from owning property, but have nevertheless played a small role in the real estate market. The foreigner demand comes mostly from Cuban-Americans or foreign spouses of Cubans.
For more than five decades, the United States sought to cripple Cuba’s economy with a trade embargo. The country survived that, its own mismanagement, and the collapse of the Soviet Union. Never ousted, revolutionary leader Fidel Castro instead retired from power and handed off to his brother, Raul.
Unveiling a dramatic change in approach, Obama said on Wednesday that he would move quickly to normalize relations and ease some restrictions on travel, trade and banking.
“I have no idea what it’s like to live without being enemies with the United States but I imagine it will be magnificent,” said Carlos Enrique Fernandez, 17, a ballet student who had just finished rehearsing at the National Ballet School and was still sweating and dressed in tights.
Cuban ballet dancers often lack slippers and tutus, suffering from the shortages that are endemic to the Cuban economy and could be alleviated under normalized U.S.-Cuban relations. Like Cuba’s prized baseball players, many defect to make more money abroad.
There are still some potential barriers to a rapid change in U.S.-Cuba relations.
While Obama can use executive powers to ease restrictions on commerce, banking and travel, he cannot entirely lift the 52-year-old economic embargo without approval from the U.S. Congress.
And Cuba’s communist leadership will almost certainly want to control the pace of economic change. President Raul Castro, who took over from his ailing older brother in 2008, has launched his own program of economic reforms at home but they are deliberately modest and slow-moving as he seeks to build what he calls a “prosperous and sustainable socialism.”
But on the streets of Havana, Cubans were already counting on a very different life after the embargo, known here as “the blockade” and always cited by Cuba’s leaders as a cause of the economy’s problems.
The changes could open investment in telecoms equipment, construction, agriculture and infrastructure, but the first impact is likely to be in tourism and services.
“There’d be more work for everybody,” said Modesto Miguel del Hoyo, 50, a driver who had just dropped off a busload of South American tourists, 13 hours into his 16-hour workday.
Del Hoyo’s salary is 395 pesos a month, roughly $15, and he lives off tips. The tip jar on his dashboard was empty but as he imagined it filling with dollars, he broke into a smile.
“I’ve been talking about this with everyone today, on every corner, and everyone is happy about this change,” he said.
Under the changes announced by Obama, travel restrictions on Americans will be eased though not yet completely lifted.
After Canada, the United States already sends the second-highest number of tourists to Cuba, mostly Cuban Americans and travelers on specially licensed “people-to-people” visits.
Those travelers will soon be able to bring home $400 worth of goods, including $100 worth of alcohol and tobacco. The expected surge in U.S. visitors and lighter controls will bring a boom for sellers of Cuban rum and cigars and well as artists, musicians and the owners of restaurants and bed-and-breakfast businesses.
“I’m going to have to toughen up and work a lot harder,” said Lazaro Perez, who hand-rolls cigars at the tobacco shop at Havana’s ornate Hotel Nacional, enjoying one of his own products.
Obama’s policy change does not just affect commerce with the United States. Non-U.S. companies have been averse to doing business in Cuba because U.S. sanctions are far-reaching and force many investors who choose Cuba to forgo the U.S. market. That risk, sometimes called the embargo tax, would disappear if the U.S. Congress agreed to lift the embargo entirely.
Francisco Cerezo, the head of Latin American practice in Miami at Foley & Lardner, said his law firm had already received increased inquiries from Latin American banks, private family businesses and large corporations on what Obama’s announcement means for their ability to invest in Cuba.
“They want to understand how this impacts their Cuba strategy. They want us to walk them through how to position themselves long-term,” he said.
Amid the joy, however, some say that Cuba’s casual approach to commerce needs to change. Doing business with the Americans means raising standards and the tourism industry will have to improve quality and service.
Tourists come for the turquoise Caribbean waters and the rich history. Many leave disappointed with the shabby state of hotels and unappetizing buffet food.
“There’s no doubt that there will be a challenge for people in the nonstate sector as more frequent visits from the Americans will require better service,” said Renier Vichot, a 31-year-old cook at La San Cristobal, a private restaurant in central Havana.
“A new era is starting with a future greatly influenced by North Americans landing in Havana. We’ve got to do better.”
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