Wednesday, February 17, 2016

New US Flight Schedules to Cuba May Signal Increased Air Freight Shipments in Future

As Relationship Softens America Must Open Up to Imports
Shipping News Feature
US – CUBA – After decades of hostility between the two it seems the possibility of air freight travelling more regularly between the US and Cuba might about to become a reality. The signing of an agreement this week by some of the big guns from both administrations for the re-establishment of scheduled passenger air services between the two countries in the very near future is a further step to normalising relations. Currently most of the restrictions on exports from the US, and the embargo on all imports from Cuba, remain.

In January there was a softening of the Export Administration Regulations (EAR) in the US, reducing the cases which require licensing, but the hard line on any goods emanating from the island country remains firmly in place for the time being. Although the recent announcement principally applies to scheduled passenger flights, any spare belly hold space would presumably be available for US/Cuba export cargo which fell into the ‘allowed’ category. Information on the current state of play with regard to cargo can be found on the Bureau of Industry and Security (BIS) website.

The new arrangement provides each country with the opportunity to operate up to 20 daily roundtrip flights between the United States and Havana. The arrangement also provides each country with the opportunity to operate up to 10 daily roundtrip flights between the United States and each of Cuba’s nine other international airports, providing US carriers with the opportunity to operate up to a total of 110 daily roundtrip flights between the United States and Cuba. The arrangement does not limit charter services, meaning that no Department of Transportation (DoT) allocation procedures are needed and charter flights can continue as they have been for some time.

Immediately following the signing, the DoT invited US air carriers to apply for an allocation of the new opportunities to provide scheduled passenger and cargo flights. The Dot will then decide who gets to fly and where from, with the Department considering which proposals will offer and maintain the best service to the travelling and shipping public. Details of the application process can be found here.

Running through the entire catalogue of US government documents relating to the improving relations is the clear indication that American officialdom views the situation as that of a rich country being munificent toward a poor neighbour. This condescension does not seem to envisage a situation in which the best way to assist a growing economy would be to accept imports and thereby boost it with earned US dollars, fortunately an influx of rich tourists via the new scheduled air services will doubtless go a long way to redress the imbalance. Until some acceptance of two way trade is reached however it is doubtful that the new relationship will be worth much other than in terms of human, rather than business, relationships