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Port Of Corpus Christi Officials Work To Increase Cuban Trade Opportunities
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Port Of Corpus Christi Officials Work To Increase Cuban Trade Opportunities
Liberalized trade with Cuba could double or triple the volume of agricultural exports leaving the Port of Corpus Christi, Texas.
Several bills pending in Congress that would lift trade restrictions with Cuba could offer huge opportunities for the Port of Corpus Christi, among them additional cargo, revenue and growth, port officials say.
 The last bill to ease restrictions passed in 2000, allowing cash sales of food and agriculture products to Cuba. The change has brought revenue of about $1.5 billion from the communist island. The Corpus Christi port signed a memorandum of understanding in 2003, becoming the first U.S. port to do so. Since then, port officials have worked to increase trade opportunities with Cuba.
Restrictions
A sticking point that limits trade, even under the reform, is a stipulation that demands cash up front for any goods sold to Cuba. “
“There are many restrictions right now that don’t allow ports and sellers to get the most of the Cuban market, which is thirsty for American agricultural goods,” said Michael Perez, the port’s director of business development. “Cuban buyers have to pay in advance for goods to a third-party European bank, which charges a hefty fee. Some of the pending legislation would allow Cuban buyers to pay for goods directly to U.S. banks, saving everyone time and money.” ”The cash sales requirement hurts trade,” Perez said.
Restrictions make it difficult for U.S. sellers to compete against global markets that don’t have such restrictions, Perez said. Since 2004, U.S. exports to Cuba declined from $392 million to $340 million in 2006, according to the U.S.-Cuba Trade and Economic Council of New York.
Bills meant to ease restrictions to the Cuban embargo in place since the early 1960s come up almost yearly, but don’t garner the bipartisan support to prevail. Kirby Jones, founder and president of the U.S.-Cuba Trade Association, said it was too early to tell if the pending bills have the support to make it through Congress.
“There is support there, but it’s about finding the right vehicle for it,” said Kirby, whose organization lobbies in Washington, D.C., for more trade opportunities with Cuba. “The next step is to wait for a report from the U.S. Trade Commission due in about a week. I think Fidel (Castro) being ill has forced many people to look at foreign policy with Cuba and contemplate changes. The U.S. agricultural community sees these bills as very significant because trade is not as good as it could be if the embargo was dropped.”
The Port of Corpus Christi is one of very few U.S. ports that has seen an increase in shipments to Cuba. Perez said one of the bills cites Cuban exports to the communist island have dropped 15 percent.
“If we could cut the payment process by a few days, travel to Cuba as needed to conduct business and host Cuban Alimport officials at U.S. ports, we would increase trade opportunities and revenue,” Perez said. “You can’t conduct business with Cuba with one three-day trip a year. These bills could mean a lot to producers and ports.”
He said cotton also could be an important export commodity with more liberalized trade.
“Cuba is also turning to bio-energy sources, such as wind turbines.”
The Port of Corpus Christi already handles a significant amount of wind turbine units, many from Europe en route to wind farms in the Southwest.
Energy Summit
The Port of Corpus Christi is planning ahead for the day when the United States embargo on Cuba is lifted. In fact, port officials were in Mexico City late February of this year discussing potential business opportunities with Cuba. The development of Cuban oil resources could be a real boost for this area.
The Energy Summit was sponsored by the U.S.-Cuba Trade Association (www.uscuba.org) along with the Port of Corpus Christi, Valero Energy Corporation, Louisiana Department of Economic Development, Lafayette Economic Development Authority, National Foreign Trade Council, Caterpillar and USA*Engage.
"With Spain, China, Canada, and Norway exploring in Cuban waters a little over 100 miles from our shores in the Gulf, it is time for U.S. firms to understand what is going on and what the future business potential might be," said Kirby Jones, President of the U.S.-Cuba Trade Association, "and this event offers the opportunity to do just that face-to-face with their Cuban counterparts."
Ruben Bonilla, Chairman of the Port of Corpus Christi, said "I am looking forward to meeting one-on-one with this distinguished group of Cuban officials and specialists to discuss the real business potential for the Southwestern United States,” before attending the summit this year.
Last year, Cubans spent 750 million dollars on U.S. agricultural and humanitarian supplies so if Congress and the president ever lift the full embargo, South Texas is prepared for the windfall.
In the meantime, port officials said serious talks are underway on a deal to export chicken and rice to Cuba.
Why is it significant for Corpus Christi?
"It means obviously more jobs," Michael Perez of the Port of Corpus Christi said. "A lean port agency that purchases food stuff for the government of Cuba has promised to double their export volumes through the Port in the next 12 months, and this means that they are committed to their words."
With the money coming in from Cuba the port of Corpus Christi may see an opportunity for expansion as well as offering more jobs locally.
A container facility in the works “will put us in the container shipping business.” Currently, local warehouses store cotton, and then ship to Houston where it’s moved out to the Pacific Coast and to the Far East markets. A container facility would shorten the route and improve efficiency, Perez said.
The Port of Corpus Christi handles the sixth highest volume of any port in the United States. The container facility could move it into fifth place. “We’re also the deepest shipping channel in the U.S. Gulf, at 45 feet of water.”
Port authorities have requested funds from the U.S. Congress to deepen the channel to 55 feet to improve shipping efficiency and to accommodate larger vessels.
“We want to be a well-diversified port,” Perez said. “We also have a 100,000 square foot cold storage facility.” He said liquid and dry bulk materials make up most of the goods coming through the facility.
“We have three large railroads serving the port and a highway system that allows trucks to move goods quickly from here to Los Angeles.”
The port operates as a free trade zone. “That was designed to create jobs,” Perez said. “No duty is imposed on goods while they are stored or assembled here.”
He said the free trade status allows shippers to get around quotas or certain fees. “If a company has more material than a quota will allow, it can store part here and move it out later without fees. Some companies use the free trade zone to manipulate duty costs.”
Perez said as the facility expands, with the container facility and a deeper channel, agriculture should benefit. “We hope to see more cotton and grain move through,” he said. |
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By
KRIS-TV @
Tuesday, September 25, 2007 5:58 AM |
The future looks bright for the Port of Corpus Christi. That's the message from Port Commission chairman Ruben Bonilla who spoke at a rotary club luncheon Thursday.
He said the port will see a lot of growth and new job opportunities over the next decade. Bonilla said there will be new waterfront development that will include a retail and business district.
"We believe that Port Avenue will be expanded, LNG plants are gonna come online, the container terminal will be built, and the port will begin the development and management of Naval Station Ingleside," Bonilla said.
Bonilla also said the Joe Fulton Trade Corridor, which opens next month, will also create new development opportunities including a power plant and a coal gasification plant. |
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