American Cuban Conundrum Case Studies Example

5-12. The key issue that prompted the EU to take the Helms-Burton dispute to the WTO was the fact that it was considered to be an act violating the rules of the international trade principles, arguing against the governments‘authority. (Keegan, 2014) In an environment where the U.S. and the EU had both reached advanced levels of economic development, any policy or practice restraining free trade should be considered illegal, or at least in theory it is stated like that. However, the United States have argued that the Helms-Burton legislation’s purpose is to promote democracy by discouraging the foreign direct investment in Cuba by threats of lawsuits and the enforcement of travel restrictions. The EU didn’t want to agree to the terms of the Helms-Burton act, therefore they have requested the WTO to create a three person trade panel that would decide the case of the act. (Keegan, 2014)
5-13. The United States government benefits from the embargo only to a limited extent. As due to the Act, the supplies sent by the U.S. may only reach Cuba through distributors that are not form the United States, fact that is actually to the disadvantage of the American companies. As the Cuban economy requires international investments, which are restricted by the Helms-Burton act, Cuba suffers from the embargo. Cuba has to pay money on all the goods that are being imported due to the prohibition of credits.
5-14. Maybe the best solution to the situation between Cuba and the United States would be to end the embargo. Cuba is a poor developing country and it is rather impossible for the loans to be repaid. Perhaps negotiating some embargo and sanction lifting and coming to an agreement that would benefit both countries is necessary and the most appropriate thing to do in the given situation under Obama’s administration.

References

Keegan, W. (2014). Global marketing management. Englewood Cliffs, N.J.: Prentice Hall.