Obama-Castro deal: Cuba’s gain, Aruba’s loss? (blog by R. Hoefte)

Obama-Castro deal: Cuba’s gain, Aruba’s loss? (blog by R. Hoefte)

President Obama’s announcement about the lifting of the Cuban embargo /bloqueo will have great economic consequences for the entire Caribbean. Cuba’s possible membership in CARICOM might breathe new life into this moribund organization. The most direct changes will probably be seen in the tourism sector. It is easily the region’s most important industry:  last year 25 million visitors annually generated approximately 40 billion euros or 14 percent of Caribbean GDP. This proportion makes the islands the most tourism-dependent region in the world.

Before World War II some 100,000 tourists per year visited the Caribbean. Its proximity to the United States along with Prohibition in the 1920s and early 1930s made Cuba by far the most popular destination. The Great Depression and the War slowed the flow of tourists, but the industry revived in the 1950s. Havana was known as the Latin Las Vegas. Meyer Lansky (the ‘Mob’s accountant’) resided in the Hotel Nacional the island’s capital, thus symbolizing how organized crime had taken over the gambling industry. President Fulgencio Batista received generous kickbacks for allowing the US mafia to run the business.  The Cuban Revolution put a stop to all this.

The rest of the Caribbean profited. Tourism replaced the export of tropical products as the mainstay of the economy. Increases in income, more leisure time, and cheaper and faster transportation all contributed to a booming business. Within two decades the number of tourists more than doubled from 4 million a year in 1965 to 10 million in 1985. About one-tenth of all Caribbean jobs are (in)directly related to the industry. One-third of the revenues remain in the Caribbean, the rest is transferred to overseas corporations.

Aruba is one of the islands that took advantage of the fact that American tourists were in search of new tropical destinations close to the East Coast. Over one million Americans visit the island every year. One terminal at Reina Beatrix Airport is designated for U.S. bound travelers. There they pass through U.S. Immigration and Customs upon departure. After the closing of the oil refinery, tourism is the only economic game in town. Will Aruba be able to hold on to this slice of the U.S. market?

Cuba will be eager to receive American visitors longing to finally see the island largely closed off to them for more than half a century. It is likely that their number will quickly surpass the one million Canadians who come to the island each year.

One question is how Cuba will present itself to the outside world: as a vintage 1950s destination or as a twenty-first-century all-inclusive resort. If the latter is the case, the dozens of photobooks in KITLV’s collection, often featuring pre-revolutionary old timers, will help to remind us of the seemingly romantic past of the embargo era.

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