ATC131108: Report of the Portfolio Committee on International Relations and Cooperation on the dialogue on South Africa-Cuba relations: Successes and challenges towards the implementation of processes aimed at kick-starting economic processes in Cuba, dated 6 October 2013

Report of the Portfolio Committee on International Relations and Cooperation on the dialogue on South Africa-Cuba relations: Successes and challenges towards the implementation of processes aimed at kick-starting economic processes in Cuba , dated 6 October 2013

The Portfolio Committee on International Relations and Cooperation (the Committee), having held a dialogue on South Africa-Cuba relations, reports as follows:

1. Introduction

The Committee had constantly had the issue of the relations between South Africa and Cuba in its business programme since 2009. The issues discussed ranged from the selfless sacrifice the Cuban people made during the liberation struggle in South Africa and in Southern Africa; the strong political and solidarity commitment the Cuban government and people had shown in the fight against apartheid; the solidarity with the Cuban people against the American economic embargo on Cuba; the call for the release of the Cuban Five in prison in America; the contribution of the Cuban government to address domestic challenges in South Africa, especially in health, education and science and technology; and the contribution of the South African government to the upliftment of the economic activity in Cuba through an Economic Assistance Package.

In 2013 alone, the Committee dedicated two sessions of its programme to debate the challenges facing Cuba; and also invited various representatives of the society to openly discuss the challenges facing Cuba and add their voice with regard to how Parliament could enhance its oversight on the relations with Cuba while ensuring sustainability. In addition to the work the Committee was already engaged in, the Speaker of the National Assembly, Hon. Max Sisulu referred a request from the Free State Provincial Legislature that the Committee recommend a resolution to the National Assembly on the a call for the release of the Cuban Five.

In response to the request and as part of its on-going programme, the Committee held its first open dialogue on 5 June 2013, with focus on South Africa-Cuba relations including the case of the Cuban Five. Additionally, there were various reports in the media about South Africa’s economic cooperation with Cuba. To effectively discuss these issues, the Committee allowed various stakeholders to make presentations.

The objective of the first engagement was to discuss and remind the audience how Cuba contributed to the struggles of the peoples of the region, including the fight, against domination and apartheid. Furthermore, the Committee aimed to discuss how Cuba has contributed towards addressing some of the South African government's domestic priorities, such as in health, education, sport and rural development. The dialogue was also expected to discuss solidarity with Cuba regarding the economic embargo and the incarceration of the five Cubans in an American jail.

During the discussions, it emerged that the main factor impeding economic activity in Cuba was the economic embargo imposed on Cuba by the United States of America (America). However the American embassy was not represented in the dialogue. The Committee then resolved that in order to have a full picture of the Cuban scenario, the Committee should visit Cuba and study the situation first hand; and also hold another dialogue to allow the American embassy to present their views on the economic embargo and the case of the Cuban Five.

Presentations were made by Ms Yolisa Maya, Deputy Director- General: Americas and the Caribbean at the Department of International Relations and Cooperation (the Department), Ambassador Eliq Savon Oliva, Charge d’Affaires of the Embassy of Cuba, and Father Michael Lapsley, founder of the Friends of Cuba Society of South Africa (FOCUS-SA).

2. The dialogue

The Committee then hosted the second dialogue on South Africa - Cuba relations on 14 August 2013 at Parliament in Good Hope Chamber. The theme of the second dialogue was ‘Successes and challenges towards the implementation of processes aimed at kick-starting economic processes in Cuba'. Participants to the dialogue were drawn from government, diplomatic corps and civil society.

Presentations were made by three speakers namely, Ambassador Dries Venter, the Chief Director for Latin America and the Caribbean, representing the Department, the ambassador of the Republic of Cuba to South Africa, His Excellency Ambassador Carlos Fernandez de Cossio and Mr Christopher Matlhako, the Secretary General of Friends of Cuba Society of South Africa (FOCUS-SA). The American embassy was invited but could not attend. The Chairperson of the Committee, Mr HT Magama MP delivered a guiding statement of objectives.

2.1        Attendance

The Committee’s members in attendance comprised the following:

Mr H T Magama (ANC) (Chairperson)

Ms W Newhoudt-Druchen (ANC)

Mr M Booi (ANC)

Ms P Ngubeni Maluleka (ANC)

Mr B Eloff (DA)

The following members had tendered apologies:

Mr B Holomisa (UDM)

Mr L S Ngonyama (COPE)

Ms C Dudley (ACDP)

Mr I Davidson (DA)

Mr E Sulliman (ANC)

Mr M B Skosana (IFP)

Support staff

The support staff that were in attendance comprised Mr L Sigwela (Committee Secretary), Ms L Mosala (Content Adviser), Mr D Madlala (Researcher) and Ms N Mooi (Committee Assistant).

3. Objectives of the dialogue

The dialogue was focused on successes and challenges towards the implementation of processes aimed at kick-starting economic processes in Cuba. The Committee had previously discussed the role South Africa could play in strengthening bilateral relations with Cuba. However, an oversight concern arose as to why it was seemingly slow for the economic activity between the two countries to flourish. This was despite South Africa’s intervention through an Economic Assistance Package agreement approved for ratification in 2012 by Parliament. Among the reported hurdles to robust economic activity in Cuba were a third party’s extra-territorial measures, in the form of the American government economic embargo on Cuba. In order to have a balanced view on the embargo and the Cuban Five, the Committee decided the second dialogue take place and the American embassy be given yet another chance to put their perspective on the issue. The American embassy was invited but could not attend

Statement of objectives by the Chairperson of the Committee, Mr HT Magama MP

The Chairperson observed that if it had not been for the contribution and sacrifices that Cuba made during the battle of Cuito Cuanavale and the impact that it had on Namibian independence; and the effect the Namibian independence had on the transition to democracy in South Africa, the country could perhaps be still battling with the demon of apartheid for several years more than it did. He cautioned that South Africa should never forget the sacrifices made by Cuba in helping the country in its transition to democracy.

He reminded the participants that Cuba and South Africa established full diplomatic relations on 11 May 1994. A number of bilateral cooperation agreements have since been signed with Cuba in areas of: science and technology, arts and culture, sport and recreation, air services, merchant shipping, trade and economic assistance. The governments of both countries shared similar interests in relation to addressing the socio-economic needs and aspirations of the peoples of both countries.

The first Cuban doctors began arriving in South Africa in 1996, to fill a skills shortage in state hospitals. The Cuban doctors were assigned to work in South Africa mainly in rural and previously under serviced areas. More than a thousand South African students were currently studying medicine in Cuba.

In 2010, Cabinet of South Africa approved an Economic Assistance Package of R300 million to Cuba, to strengthen bilateral trade and investment and assist in addressing effects of natural disasters. However, there were still challenges towards the actual implementation of the agreement. The Chairperson explained that the dialogue should therefore provide answers relating to the challenges experienced in South Africa regarding the implementation of the agreement.

He added that the Committee was aware of other related factors which posed as challenges to the kick-starting of meaningful bilateral economic activity in Cuba. Cuba’s foreign exchange constraints, the serious infrastructure damage during the 2008 hurricane season and the continued economic embargo placed by the American government on Cuba were highlighted as some of the main concerns to Cuba’s economic development. He explained that the dialogue was held in order that the Committee understood both the Cuban side of the story as well as that from the United States of America.

The Committee had therefore resolved to invite the US representatives in South Africa to contribute to the dialogue and put across their own perspective on the embargo on Cuba. Sadly, the Chairperson elaborated, the American embassy would not be in attendance.

With regard to political relations, Cuba and South Africa collaborated on political issues of domestic and international nature. South Africa supports the call on the American government for the release of the incarcerated Cuban Five.

4. Presentation by Ambassador Dries Venter, Chief Director: Latin America and the Caribbean, Department of International Relations and Cooperation

He noted that the role that Cuba played in the liberation of South Africa prior 1994 was influential to the close bilateral and political relations between South Africa and Cuba. The two countries cooperate on multilateral forums in pursuit of the rule of law and inclusiveness. South Africa and Cuba relations were established long ago between the then liberation movement, the African National Congress (ANC) and the government of the Communist Party of Cuba.

Cuba was the first country to offer material and human resource support to South Africa post-1994. It has therefore been a backbone of the South African liberation despite its own many challenges. Since 1994 many high level interactions have taken place. President Jacob Zuma’s state visit to Cuba in December 2010 was a major development and served to further enhance the excellent relations between South Africa and Cuba.

Cuba was seen as a key partner in pursuit of government’s identified domestic priorities. Various bilateral agreements in the fields of science and technology, health, trade and industry, arts and culture, education were some of the many which were in place with Cuba. South Africa was a beneficiary of Cuba’s on-going assistance in the form of scholarship for the youth. Currently, there were close to 1400 South African students studying medicine in Cuban universities. A total of 323 South African graduates from the Cuban programme worked as medical doctors in various South African hospitals.

In 2012, the South Africa-Cuba Extended Cooperation Agreement in the fields of health and medical sciences was signed. This would lead to an increased number of South African medical students studying in Cuba; thereby contributing to the implementation of the National Health Insurance (NHI).

In 2010, South Africa announced the cancellation of Cuba’s R1 billion debt; this paved the way for enhanced trade and commercial relations. In 2012, an Economic Assistance Package agreement of R300 million was concluded with Cuba. The challenge has been with the implementation of the agreement due to Cuba’s economic structure and the American economic embargo extra-territorially applied on Cuba. The South African government has since addressed the issue of non implementation by designating the Industrial Development Corporation (IDC), as its state agent responsible for administering the economic assistance package.

According to the American government’s extra-territorial laws on sanctions on Cuba, any commercial bank doing business with Cuba (transfers of money), would be barred in the future from effecting commercial transactions with clients in the United States. The Economic Assistance Package should be seen as part of the South Africa-Cuba Joint Bilateral Commission of Cooperation in existence since 2001.

Another identified challenge to economic activity in Cuba was the lack of a coordinating structure within South Africa for business to business contact in order to grow trade with Cuba. It was further suggested that South African companies should look into mining and tourism in Cuba. Infrastructure was greatly in demand, and logistics of getting and conducting trade with infrastructure was a big challenge. Cuba however has an excellent skilled work force, a positive factor for business.

5. Presentation by His Excellency Ambassador Carlos Fernandez de Cossio, Embassy of the Republic of Cuba

The more that Cuba and South Africa learned about each other, the better would be the chances for these countries to strengthen their bilateral relations. The relationship was based on historical ties, including Cuba’s general solidarity with African countries, and was also based on the role that South Africa played on the international front. He observed that huge resources, time and space had been dedicated, by major media players, to propaganda against Cuba, so he welcomed any opportunity to speak about Cuba publicly.

Ambassador Carlos Fernandez de Cossio noted that Cuba did not have a large economy and was a poor country. Life expectancy was however high, at 76 years. Public health was provided free and education was also free, public and universal. Economic development was slowly on the rise. The illustrations were meant to show the difference between economic development and social cohesiveness. Equity in Cuba was one of the most generalised in the world, with a fair distribution of the country’s wealth. However, the Cuban government was aware that the wellbeing of the population needed to be improved. In order to achieve that, the concrete limitations to Cuba’s economic development would need to be overcome.

He acknowledged the challenges Cuba faced in developing the economy including lack of sufficient natural resources (such as energy resources); lack of exporting strategic minerals (such as gold, platinum); have land but is not suitable for growing commercial crops like wheat; and the American government economic embargo. In elaborating on the extend of the embargo, he saw it as an economic warfare on a small nation by the biggest economic power in the world, which was adopted as a foreign policy with legitimate mandate from the American government. The United States of America policies barred Cuba from trading bilaterally within the largest economy in the world.

Trading limitations meant that Cuba could not buy goods that had more than 10 per cent of American material, origin or technology. The barrier on trade meant that Cuba could not trade its nickel, sugar or any other raw materials to any company which also had the American market as a target. No ship which docked at a Cuban port could dock an American port within six months. Cuba had no access to the international financial markets because by law they were barred from engaging with Cuba. Cuba was therefore the only developing country in the world which has no access to financial assistance for development. Cuba also did not have any access to American technology.

Ambassador de Cossio cited the example of a partnership between Cuba, Canada and Britain for the development of grass for golf estates in Cuba. However, because the grass seeds were a result of generic technology from the America, the venture could not materialise. He saw the aim of the American government as to defeat the Cuban revolution completely.

The other limitation to Cuba’s economic development was its significant economic inefficiencies. The economic policies were very poor, and needed to be acknowledged and changed. An open public participation process was embarked on, where an update of the economic model was subjected to input by the Cuban society. The policy had since been adopted as a legal mandate. The basic elements of this policy were to diversify the economy in Cuba, to promote entrepreneurship and to strengthen Cuba’s economic presence. Brazil, Algeria and Angola, Japan and South Korea were some of Cuba’s new trading partners.

Cuba would also be focusing on making structural adjustments in order to achieve its economic development priorities, although the essence of its social economic policy would remain intact. The need to build an efficient and sustainable economy was realised, and defensive mechanisms which were impediments to trade were being voluntarily removed. Non-state actors would be promoted to participate in the economy and manage state-owned enterprises; while discouraging government from direct management of economic activity.

He concluded with a call for the government of the United States to release the Cuban Five, imprisoned under false accusations. He stated that America needed pressure by the international community to release the five.

6. Presentation by Mr Christopher Matlhako, Secretary General, FOCUS-South Africa

Mr Matlhako explained that FOCUS-SA was a volunteer progressive organization of ordinary South Africans founded in 1995. It was borne of recognition that South Africa’s liberation struggle was supported by many countries internationally.

The organisation had, over the years sought to engage and enhance broader unbiased understanding of Cuba and the Cuban Revolution. FOCUS-SA shared the perspectives of sovereignty, freedom and democracy and a non-hegemonic multilateral world order. The organisations’ key programmes were concerned with:-

·         The Free the Five campaign in line with international law;

·         Ending of the blockade against Cuba;

·         Normalization of relations between Cuba and the US; and

·         Ending the continued occupation of Guantanamo Bay in violation of existing international law.

The organisation has been instrumental in preparing and cushioning South African students who would be studying in Cuba on the cultural differences with Cuba.

He reminded that Cuba had contributed to South Africa’s liberation and should not be forgotten. He believed that the people of Cuba deserved peace, democracy and free economic activity. International solidarity was seen as a key ingredient for the Cuban economic emancipation. He agreed that media coverage had been very negative about Cuba, resulting in a huge distortion of the Cuban reality.

He made a call for the Cuban Five to be released and their families to be allowed to visit them. He further called on the United States of America to normalise relations with Cuba. He saw it as a gross violation of human rights for the America to have a law dictating how Cuba should conduct its affairs. He called upon the South African government and Parliament to engage the American government on the embargo and find a lasting solution to the problem. He concluded with a tabulation of the main reasons why FOCUS-SA supported Cuba as follows:

1.     Cuba has one of the highest literacy rates in the world.

2.     Healthcare was free, universal and high quality.

3.     Education was free, universal and of high quality.

4.     Legacy of racism was being wiped out.

5.     Women's rights were promoted.

6.     Community spirit still existed.

7.     Cuba's turn towards sustainable 'green' and alternative energy-sources and power grid were exemplary.

7. Discussions and observations

During the discussions, the participants highlighted the following:

Cuba has been part of South Africa through its role in the liberation struggle. On its part Parliament has approved the ratification of the Economic Assistance Package in 2012, but it was alarming to learn that the agreement had not yet been implemented.

It was observed that service delivery was very good in Cuba. There was interest to know of the strategies put in place by Cuba which could help South Africa address service delivery challenges.

It was observed that the practice of posting trade attaches to embassies abroad has since slowed down. It was felt that a deliberate policy direction towards economic diplomacy, which directly impacted on domestic deliverables, should be met with adequate capacity in the embassies to handle these issues.

Advice was sought as to role South Africa could play to bring the United States of America and Cuba together to discuss the economic embargo on Cuba. The embargo was seen as an impediment to meaningful economic activity in and with Cuba.

Clarity was sought regarding whether the United Nations and the African Union had applied their minds on the issue of the economic embargo on Cuba. These organisations could be able to influence the American government.

Information was sought regarding holding of elections in Cuba. Details on how often they were held were requested.

An elaboration on the details of the economic embargo on Cuba was sought. Clarity was also sought on “third markets” from which commodities were sourced and sent to Cuba. The concern was whether these markets came about because of commodities which could not be sourced within Cuba.

Cuba was one of the first countries which established an embassy in South Africa, and so the relationship was a treasured one. It was not simply a political one; the two economies complemented each other.

8. Responses by the presenters

8.1        Response by Ambassador Dries Venter

Ambassador Venter noted that it was important to understand the history of South Africa-Cuba relations before 1994. He said Cuba offered its continuous support to South Africa even after 1994 because Cuba already had training facilities for medical doctors. The Minister of Health therefore encouraged these partnerships for the time being, especially in the fields of health and engineering. He said the United States of America was not eager to sit and discuss matters on Cuba in any forum; therefore talks with the African Union and the United Nations or the Brazil-Russia-India-China-South Africa forum (BRICS) would not amount to much.

On the economic assistance programme, he said the main challenge to its full implementation was that in order for Cuba to receive money from South Africa, there needed to be effective banking systems in place. Cuba’s banking system was interrupted by the American government embargo. However the government has designated the Industrial Development Corporation (IDC) to administer the package and hopefully the processes would kick-start. He added that R 40 million of the grant was put aside to purchase seeds. The Department was in partnerships with the Department of Agriculture to facilitate the process. However there were still some problems with logistics.

He explained that the levels of trade attaches’ deployments to embassies had decreased as there was a stronger focus within the Department to improve economic diplomacy. However, there was still a large percentage of work which needed to be done. He put emphasis on the fact that there was a need for government to coordinate private sector involvement to invest in partnership with other businesses in Cuba. There has been no structure developed to follow-up on the possible commercial activities in Cuba.

Ambassador Venter further replied that he did not have the figures on the banking costs. He said it was a challenge for banks to facilitate transfers to Cuba because of the American economic embargo, and this was a main challenge to the implementation of the economic agreement.

He informed the Committee that a deployment of a Health Attaché to the South African embassy in Cuba as a huge step. The Attaché was expected to deal with all related issues of medical students studying in Cuba; and the gesture was a show of commitment by the government to Cuba’s human resource contribution.

8.2        Response by His Excellency Ambassador Carlos Fernandez de Cossio

Ambassador Carlos Fernandez de Cossio replied that it could be estimated that less than four per cent of Cuba’s population was unemployed. On corruption, he said in every country in the world, there was some form of corruption. In Cuba however, corruption was not too much of a concern. There was however a need for stronger legislation. Cuba was making an effort to boost commercial activity within the country. It was encouraging entrepreneurship; people were given funds to establish their own businesses to reduce corruption and unemployment.

On elections, he said national and provincial elections were held every five years, while municipal elections were held every two years. There was one party, the Communist Party. He said the population in Cuba was estimated to be around 11.2 million.

He explained that the reason for the current American government policy towards Cuba could be traced back to around the 1960’s when Cuba was supporting revolutionary movements in Latin America. In the 1970’s, Cuba supported the military revolution in Angola, and in the 1980’s Cuba supported the Soviet Union and other revolutionary movement in central America and the United States was not impressed and has since taken a very hostile stance towards Cuba. The United States of America did not want to be challenged in its attempts to move towards international dominance.

On BRICS, he said Cuba had good relations with the BRICS countries and was an active member of the United Nations, however the American government policy on Cuba was isolated as America was too powerful to feel the heat. Cuba was willing to work with BRICS in any way. He replied to the question on third markets and said they were there to secure finance, so that Cuba was less dependent on credit. Cuba was aiming to make direct payments only.

8.3        Response by Mr Christopher Matlhako

Mr Matlhako saw a continued mobilization of civil society as vital and thanked the Committee for awarding FOCUS-SA an opportunity to introduce themselves to the Committee. He challenged the Committee to recommend that Parliament pass a motion for the release of the Cuban Five and the lifting of the American government economic embargo on Cuba.

9. Conclusion

The Chairperson thanked all members for their contributions. He said civil society needed to be engaged on matters of national and international importance. Their voices could influence policies. Cuba was one of South Africa’s most reliable allies, and the political will to partner with Cuba should be put into practice. The Committee should strengthen oversight over the implementation of the Economic Assistance Package. As a country, South Africa could never forget that it too benefited from international solidarity.

10. Recommendations

In its meeting of 6 of November 2013, in Room M201, Marks Building, the Committee decided to bring to finality the matter of Cuba and its challenges. Having had input from different stakeholders in two previous dialogues on Cuba, the Committee felt adequately informed and recommended to Parliament as follows:

1.     Parliament should continue to support efforts by Government to call for the lifting of the American government economic embargo on Cuba and the release of the Cuban Five.

2.     Parliament should lead efforts to strengthen and coordinate parliamentary efforts in multilateral forums in support of the lifting of the American government economic embargo and the release of the Cuban Five.

3.     Parliament should mobilise civil society around the issue of Cuba.

4.     Parliament should call for and support the implementation of the South African Economic Assistance Package to Cuba.

5.     The Committee should submit a resolution to the House on the matter of Cuba.

Report to be considered.