Crack In The Embargo

After more than 50 years of enmity, the U.S. and Cuba are finally on a path to normalizing relations

An American embassy in Havana. Discussions at the highest levels between the Castro and Obama governments. Using American credit cards in Cuba. Bringing some Cohibas and Montecristos legally to the United States.

Last fall such notions seemed far, far away, but in one quick moment there was a crack in the U.S. embargo on Cuba that has made all of these items a reality, ushering in the biggest changes in U.S.-Cuba policy since the embargo began 50 years ago.

At around 11 a.m. on December 17, 65-year-old Alan Gross stepped off a plane at Andrews Air Force Base in Maryland. He was a free man after being held for five years in Cuba, charged with distributing electronics and computer equipment to people in the communist country, where the Internet is tightly controlled. Gross, who had become a symbol of the ill will between Cuba and the United States, was part of a prisoner exchange between the two countries, and an hour after he made his return to American soil, U.S. President Barack Obama took to a podium at the White House and announced historic changes to the way the United States and Cuba would interact.

"In the most significant changes in our policy in more than 50 years, we are going to end an outdated approach that, for decades, has failed to advance our interests. And, instead, we will begin to normalize relations between our two countries," said President Obama.

President Obama spoke frankly about the embargo, calling it a policy that has not worked. "It has had little effect," he said, "beyond providing the Cuban government with a rationale for providing restrictions on its people. Today, Cuba is still governed by the Castros and the communist party that came to power half a century ago."

On January 16, the changes were entered into the Federal Register, making the new rules official. Americans on authorized visits to Cuba may return to the U.S. with up to $100 worth of Cuban cigars; American credit and debit cards may now be used in Cuba; a per diem limit no longer governs expenses on authorized visits to the island by Americans; travel agents and airlines may provide travel and services to Cuba without a specific OFAC license; Americans may send four times the money ($2,000 a quarter, up from $500) to Cuban nationals, excluding certain Cuban government and communist party officials; no limits regulate donations for humanitarian efforts; U.S. businesses will have an easier time sending goods to Cuba and setting up financing on the island and more.

Talks to establish a U.S. embassy in Havana for the first time since 1961 have begun and U.S. Secretary of State John Kerry will visit sometime in the near future. (The U.S. has maintained an Interests Section in Cuba, but no official embassy.) "I look forward to being the first Secretary of State in 60 years to visit Cuba," Kerry said. He is also leading a review of Cuba's designation as a state sponsor of terrorism.

These moves are not an end to the embargo, and the president needs Congress to fully normalize relations. In his speech, he said he would reach out to Congress to begin talks to end the embargo.

The changes seem to favor the flow of U.S. goods to Cuba, while still largely curtailing the flow in the opposite direction. While tourism will not be openly allowed under these new policies and most Americans will still be prohibited from entering Cuba, those with family in Cuba, people on humanitarian missions and journalists will be less restricted. "It will be easier for Americans to travel to Cuba," Obama said.

The ability to bring back some cigars got considerable attention in the news, some of it incorrect. The new policy allows travelers taking authorized trips between the United States and Cuba to return with $400 worth of Cuban goods, up to $100 of which can be cigars and/or alcohol. This applies only to authorized trips between Cuba and the United States. American travelers going to third-party countries such as France or the United Kingdom could not legally transport Cuban cigars (or any other Cuban products) to the United States upon their return to the U.S. "Travelers to other parts of the world will not be permitted to bring in Cuban cigars," says a source in the U.S. Treasury Department.

While Cuban cigars are extremely affordable when purchased in Havana, $100 buys a very limited number—less than a full box of most well-known brands.

The crack in the embargo is the result of high-level, direct discussions between the U.S. and Cuban governments, including a conversation lasting approximately one hour between U.S. president Barack Obama and Cuban president Raúl Castro that led to the release of prisoners held by both countries. In addition to Gross, Cuba released an unnamed American spy who has been incarcerated in Cuba for nearly 20 years. In return, the U.S. freed the three members of the so-called "Cuban Five" who remained incarcerated. The Cubans were arrested in 1998 and had been imprisoned by the U.S. after being convicted of espionage.

President Obama emphasized human rights several times in his speech, and noted the damage the embargo has done to ordinary Cubans, rather than the government in power. "We should not allow U.S. sanctions to add to the burden of Cuban citizens," he said. "U.S. engagement will be critical when appropriate and will include continued strong support for improved human rights conditions and democratic reforms in Cuba and other measures aimed at fostering improved conditions for the Cuban people." One demand made by the United States for normalizing relations was that Cuba free some of its citizens who were being held in prisons, and in mid-January the United States announced that Cuba had freed 53 dissidents who were on a list provided by the American government.

The changes are dramatic, but far from complete. The news does not mean that Cuban cigars and other goods will appear in U.S. shops anytime soon, but it does represent an important first step—and a big one—in establishing normalized relations between the two countries.

The move was met with some criticism. Senator Marco Rubio (R-Florida), speaking on CNN, felt that the U.S. is giving up too much in this arrangement, and the Cuban government has done too little to justify these moves.

This move, said Rubio, means the Cubans are providing "No democratic opening, no freedom of the press, no freedom of organization or assembly, no elections, no political parties, no democratic opening at all.... It is a lifeline to the Castro regime that will allow them to become more profitable. The Cuban people are even further away from democracy."

Others see this as a move in the right direction.

"Opening the door with Cuba for trade, travel and the exchange of ideas will create a force for positive change in Cuba that more than 50 years of our current policy of exclusion could not achieve," says Senator Dick Durbin (D-Illinois).

"Obama has finally advanced the interests of U.S. policy by endingthe perpetual hostility in relations between Washington and Havana," says Peter Kornbluh, an author of several books on U.S.-Cuba relations and a Cigar Aficionado contributor. "He has brought U.S. policy from its anachronistic past into the modern world."

Marvin R. Shanken, editor and publisher of Cigar Aficionado magazine, says: "For cigar smokers in America, Cuban cigars have long been the forbidden fruit. The cigar business was born in Cuba, and cigars made in Havana have a worldwide reputation for excellence. We yearn for the day when our readers can have the opportunity to legally buy and enjoy cigars from every country. Today marks the biggest change in U.S.-Cuba relations since 1961. This does not mean the end of the embargo, but it's the dawn of a new day that brings the United States and Cuba a big step closer to normal relations. For cigar smokers, there is the promise of something bigger to come."

"It's been crazy, but it's all been good news," says Dawn Davis, who has been arranging education travel to Cuba since 2010 through Academic Travel Abroad. She saw a huge surge in interest as soon as the announcement was made. "People want to go now for fear of how Cuba will change in years to come under American influence." The development has created some confusion, she notes. "A lot of people think that you can buy a ticket and fly to Havana. That's still not the case." For Davis, a critical difference is that such groups as museums and universities that have sponsored travel to Cuba needn't reapply each time they create a new program. She added that Cubans are excited for the opportunities this will bring. "For them it is the door cracking open a bit."

"We've never seen anything like this before," says Tom Popper, president of InsightCuba, which has been providing people-to-people trips to Cuba for Americans since 2000. "Since President Obama's address to the nation, web traffic has increased six times, and both inquiries and bookings have increased four times our normal volume. What we hear consistently from our guests is they had no idea they could go legally and they want to go now before Cuba changes."

President Obama has long hinted that he was open to easing the longstanding animosity between the U.S. and Cuba. In March, 2009 President Obama signed a Senate appropriations bill into law that made it easier for Cuban-Americans to visit relatives in Cuba, and also paved the way for more business travelers to go to the island. In 2011, he greatly expanded the number of U.S. airports that could host flights to Cuba, and he made headlines in December 2013 when he shook hands with Raúl Castro at the funeral of Nelson Mandela.

Andrew Nagy and Gordon Mott contributed to this story.