Cuba Wants Biden to Bring Back Remittances But Sees U.S. Funding Enemies Within

Cuba is calling on President Joe Biden to lift the ban his predecessor slapped on remittances to the island nation, but Havana remains concerned about who is receiving the money being sent from the U.S. during a period of heightened tensions between the two longtime foes.

In the wake of last month's rare demonstrations against what Cuban protesters deemed to be the government's inadequate response to the added hardships felt during the COVID-19 pandemic, the U.S. leader who once backed a warming of ties with Havana while vice president took a tougher turn, adding more sanctions to a decades-long embargo hardened by former President Donald Trump.

But as the White House formulates its Cuba policy, a working group has been established to review potentially easing one of Trump's harshest measures: a ban on remittances sent from the U.S. to Cuba, a lifeline long considered crucial to many, especially during the current crisis afflicting the country.

Rather than support Washington's stated goal of supporting the Cuban people, officials in Havana say this restriction has only exacerbated the country's woes.

"The main impact of the interruption of remittances through formal and institutional channels was the increased difficulty and costs of receiving them, therefore an impact on the standard of living of the recipients and the pockets of those sending them," Yamil Hernández González, general manager at Cuba's state-run Financiera Cimex S.A. (FINCIMEX) remittances company, told Newsweek.

While some money continues to flow into Cuba, it does so at a significantly higher cost.

"It is said that people are currently paying up to 30% in commissions in the U.S. to be able to send money to their families, loved ones or acquaintances in Cuba through irregular channels—in other words, $30 for every $100," he added. "Who benefits from that? It is an undeserved punishment of the people of Cuba and their families in the U.S."

There is another side effect as well, according to Hernández González, "an increase in uncontrolled transfers of currency from the U.S. to Cuba, trans-border movement of cash, something that is never positive and that goes against what the international community is trying to organize and regulate."

"Consequently, a lifting of the restrictions imposed on October 2020 would benefit all those now unfairly affected, which is no small achievement," he said. "It would also help to regularize again the main movement of currency between our two countries."

Havana, Cuba, Western Union, closed, sanctions, remittances
"It is said that people are currently paying up to 30% in commissions in the U.S. to be able to send money to their families, loved ones or acquaintances in Cuba through irregular channels—in other words, $30 for every $100,"Yamil Hernández González, general manager at Cuba's state-run Financiera Cimex S.A. (FINCIMEX) remittances company, told Newsweek. "Who benefits from that? It is an undeserved punishment of the people of Cuba and their families in the U.S." In this photo, people are seen outside a Western Union office in Havana, as the U.S.-based money transfer company shuts its officers in Cuba after new U.S. sanctions put in place under then-President Donald Trump, on November 23, 2020. Western Union closed its operations in Cuba following new restrictions from Washington which prevent the firm from working with FINCIMEX, a state-run venture that handles remittances, cutting off thousands of Cubans from receiving funds from relatives in the United States. YAMIL LAGE/AFP/Getty Images

Far outside the reaches of such regulations, however, Cuba sees financial movements with ulterior motives that harken back to the hostility that lingers between the Cold War-era adversaries.

"The U.S. government has been sending money to people in Cuba for a long time. It has been making payments to agents and sympathizers for decades. There is public knowledge of it and there is abundant evidence," Hernández González said. "What the U.S. government has no right to do is to attempt to organize Cuba's institutions and their respective roles and responsibilities."

But that's precisely what the Biden administration seeks to do should remittances once again be allowed from the U.S. to Cuba.

"The Administration has formed a Remittance Working Group to identify the most effective way to get remittances directly into the hands of the Cuban people," a State Department spokesperson told Newsweek. "At the President's direction the State Department and the Treasury Department will provide recommendations to the President for how to maximize remittances to the Cuban people, while minimizing or eliminating the Cuban military's ability to take a cut."

The initiative was previewed late last month as one senior Biden administration official discussed the White House's thinking on the issue. The official provided an example of how the U.S. has implemented a system that allowed finances to dodge the socialist government in Venezuela led by President Nicolás Maduro, an ally of Cuba, and run directly through the self-proclaimed Washington-backed interim government of opposition-controlled National Assembly leader Juan Guaidó.

"We've actually been able to roll out licenses that have allowed the interim government to send money directly to people in Venezuela," the official said during the July 30 call with reporters.

And when it comes to Cuba, the official said that the ultimate goal "is maximizing the benefit to the Cuban people, and that really has to be the focus of everything that we do in this situation."

The State Department spokesperson elaborated on who the U.S. is backing in Cuba.

"The U.S. supports pro-democracy activists and human rights defenders around the world to advance the right of self-determination through democratic processes," the spokesperson told Newsweek. "and to promote respect for the internationally recognized human rights and fundamental freedoms enshrined in the Universal Declaration of Human Rights. U.S. assistance works to promote these same principles in Cuba."

"With this assistance, the State Department, the U.S. Agency for International Development (USAID), and the National Endowment for Democracy (NED) support democracy, human rights, and free enterprise in Cuba," the spokesperson added. "These efforts are funded through Economic Support Funds (ESF) in the annual foreign operations appropriations bill."

The mission set for these programs include: "Strengthening civil society through training on advocacy, leadership skills, accountable governance, and documenting human rights violations, among others; Increasing the free flow of information to, from, and within the island through support to independent journalists; Providing basic needs assistance to victims of repression, including political prisoners, their family members, and other individuals who are persecuted because of their political or religious beliefs."

The U.S. has a long history of intervention in Cuba, dating back more than a century before Fidel Castro's 1959 revolution. The U.S. declared victory in the Spanish American War on December 10, 1898, essentially placing the former Spanish colony of Cuba under Washington's control before the establishment of a client state that was overthrown by Castro, who eventually brought communism to the island nation.

On October 19, 1960, under the Eisenhower administration, the U.S. began one of the longest-running economic embargoes in history, which was accompanied by various attempts to kill or overthrow the Cuban leadership, including the abortive Bay of Pigs rebel invasion launched from the U.S. in 1961.

Bad blood outlived even the fall of the Soviet Union in 1991, and relations between Washington and Havana only seriously shifted in 2014, as former President Barack Obama began to pursue a detente with Cuba, then led by Raul Castro.

These measures were reversed by Trump and replaced with a hardline approach that Biden himself argued against while running for president last year, saying that they "inflicted harm on the Cuban people and have done nothing to advance democracy and human rights."

But more than half a year into his tenure at the White House, the sanctions remain in place, even after the United Nations General Assembly overwhelmingly voted to condemn the embargo for the 29th consecutive time in June.

And while critics of the hardline U.S. position toward Cuba see easing remittances as a relatively simple alleviation of the difficulties imposed on the Cuban people, White House Press Secretary Deputy Press Secretary Karine Jean-Pierre told a separate July 30 press gathering that remittances constitute "a complex issue," one "that requires coordination with experts that will help to inform the administration's policy."

That same day, Biden announced his strategy during a meeting with Cuban American community representatives that he had instructed the State Department and Treasury Department to come up with "recommendations of how to maximize the flow of remittances to the Cuban people, without the Cuban military taking their cut" in the span of a month, a timeline now past the half-way mark.

Hernández González denied this oft-repeated allegation that the state skimmed off substantial sums as has been alleged by U.S. activists and lawmakers.

"It is not true that the Cuban company FINCIMEX, that the Cuban government or that the armed forces appropriated 20 or 40% of the money that was being remitted to Cuba from the U.S. through Western Union," he said.

"In fact," Hernández González added, "the money transferred was not taxed at all in Cuba."

He then outlined the process.

"The beneficiaries of the remittances received them in their full amount. Western Union, which is a U.S. company, charged in the U.S. a commission to the sender of the remittances based on market standards and according to the amount to be sent," Hernández González said. "It represented approximately 5 U.S. dollars for every one hundred dollar operation, of which it paid FINCIMEX one dollar for services rendered. On all operations, FINCIMEX was paid as a percentage of the price established by Western Union."

Western Union did not immediately respond to Newsweek's request for comment.

But if the Biden administration sought assurances that such remittances would not end up in the hands of U.S.-blacklisted individuals, organizations or entities, they would be disappointed.

Hernández González provided two reasons why.

"First of all, Cuba cannot and will not give assurances to the U.S. that are absolutely discriminatory," Hernández González said. "Remittances received from abroad by Cuban institutions are forwarded to the designated recipient free from US political considerations and free from discriminations of any type. It is absurd to expect that the Cuban government or Cuban institutions would follow a U.S. orientation on who can and who cannot receive remittances."

"Secondly," he added, "you have to understand that US actions against Cuba on remittances are based on false assumptions, among them, those related to FINCIMEX."

He described FINCIMEX as "100% percent civilian" with no military employees.

"It is not true that it belongs to the armed forces," he argued. "It's is a commercial company as many others that exist in Cuba, acknowledged and respected in the international business networks related to remittances. It has commercial relations with important financial institutions of several countries and provides services for remittances from different parts of the world. Its business records are public, according to the legislation related to public limited companies and the Mercantile Register."

Hernández González said that his company was the only one in the country allowed to receive remittances from abroad, and that Washington was in no place to change this.

"No foreign government, including the U.S. government," he explained, "has the right to dictate to Cuba which company can and which cannot manage remittances."

Biden, meet, Cuban, American, leaders
U.S. President Joe Biden (C) speaks before a meeting with Cuban-American leaders and activists in the State Dining Room of the White House on July 30 in Washington, D.C. While Biden supported efforts to reconcile with Cuba as he served as vice president under President Barack Obama, the new U.S. leader is looking to capitalize on recent protests to impose tougher measures against Havana. Anna Moneymaker/Getty Images

The U.S. has, however, continued to leverage its unmatched influence on the global financial system to punish designated targets in Cuba and elsewhere around the world.

While the Biden administration continues to deliberate on if and how to reopen remittances, as well as on the broader policy review toward Cuba, the State Department has continued to roll out new sanctions against Cuban officials accused of cracking down on the recent demonstrations.

First, Secretary of State Antony Blinken took on Cuban Defense Minister Álvaro López Miera and the Cuban Interior Ministry's National Special Brigade in response to the government's handling of the protests in July. Then, on Friday, Blinken announced a new set of restrictions against Cuban Ministry of the Interior Political Directorate chief Romárico Vidal Sotomayor García, Cuban National Revolutionary Police Political Directorate chief Pedro Orlando Martínez Fernández and the Cuban Revolutionary Armed Forces' Prevention Troops, an elite counterintelligence force also known as the "Red Berets."

"We stand in solidarity with the courageous Cubans who are protesting for human rights and fundamental freedoms, exercising their rights in the face of repeated oppression and abuse from the Cuban regime," Blinken said. "The Cuban people deserve the ability to safely protest against an authoritarian regime and the failed system that has denied them access to basic necessities for decades."

He also warned there may be more punitive measures to come.

"The United States supports the people of Cuba in their brave call for freedom as we identify those who oppress them and attempt to maintain a repressive system," the top U.S. diplomat added. "We will continue to take actions to promote accountability for the Cuban government's human rights abuses."

In Havana, the moves are seen by officials as a part of a broader effort to systematically undermine the Cuban government by hurting rather than helping the country's population of more than 11 million.

"The current situation is a direct result of a U.S. deliberate plan to depress the standard of living to the population, to deprive Cubans of money sent by their relatives in the U.S.," Hernández González argued.

He accused the U.S. of distorting the truth to support this strategy.

"Politicians in Washington have found that they have to sell their objectives to the public with misinformation and false assumptions," he added. "And that is why there is so much confusion and misunderstanding regarding Cuba and remittances."

Havana, Cuba, daily, life, pandemic
Cubans wearing face masks walk along a street of Havana, on August 11. Life goes on on the Communist-led island nation in spite of decades of embargo, new hardships brought on by the COVID-19 pandemic and a rare eruption of protests that have since calmed, despite continued support from the United States. YAMIL LAGE/AFP/Getty Images