Thursday, May 14, 2015

Logistics Growth as Cuba and US Cuddle Up While Freight and Passenger Ferry and Air Services Move In

Freeing Up of Relations Leads to Several Licence to Trade Applications
Shipping News Feature

US – CUBA – After the US government's recent decision to ease the sanctions outlined in the 1960 trade embargo on Cuba, a number of passenger and freight ferry operators have applied for licences, of which many have been granted, to start a new service between the two countries. Though only authorised travellers from the US will, so far, be allowed to go to Cuba as the general ban on tourism remains in effect, more restrictions are likely to be lifted as the countries look to repair relations and as Cuba looks to increase its presence as a major international logistics hub following the recent agreement with CMA CGM.

One such company to apply for a licence is a Spanish maritime transport firm, Balearia, which has operated in the Caribbean region since late 2011 under the brand Bahamas Express, and has a high speed vessel in the area which the company reckons is ideal for the Cuba routes. For its connections with Cuba, Balearia would operate two lines between Florida and the Havana Port: one with a high speed vessel from Key West, and a second with a ferry from Port Everglades.

Airlines also look set to take advantage of the easing of sanctions with JetBlue Airways announcing a new charter flight service, from New York's John F. Kennedy International Airport to Havana's José Martí International Airport beginning July 3, 2015.

At least four other transport companies have been granted a licence to operate between the US and Cuba: Havana Ferry Partners, Baja Ferries, United Caribbean Lines, and Airline Brokers. All four are planning to start ferry services later in the year in what will seem to be a well saturated route. Whilst the US has granted the licences, the ferry operators still need approval from Cuban authorities.

The US Department of Treasury's Office of Foreign Assets Control (OFAC) is amending the Regulations to implement certain policy changes announced by the President on December 17, 2014. These amendments see an easing of restrictions that affect a number of industries including travel, financial, telecommunications, and shipping, and will see the country taken off the black list of state sponsors of terrorism.

In 2001, following changes in sanction regulations the previous year, Crowley Maritime was the first US company to obtain a licence to provide regularly scheduled common carrier services from its home country to the Republic after a break of almost forty years when the ban was imposed. This service has remained, continuously shipping licensed cargo on a regular basis ever since.

Photo: Vessel moored at the Sierra Maestra Terminal, Havana Port.