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February 25, 2005 

Cuba's Alimport Issues Statement on OFAC's Cash In Advance Decision

The Government of Cuba's food purchasing and importing agency, Empresa Cubana de Importacion de Alimentos (commonly known as Alimport), today issued the following statement on OFAC's decision to modify the term "payment of cash in advance" as it applies to the sale of U.S. agricultural products, medicine and medical supplies to Cuba:

(Unofficial Translation)

In a press release of February 22, 2005, the US Department of Treasury announced its interpretation of the term "cash in advance" established in the Trade Sanctions Reform and Export Enhancement Act promulgated by the US Congress in 2000.

According to the aforementioned release, the Cuban payments must be received prior to the Cuba-bound cargoes are loaded on board ships in the US, a departure from the existing practice of payments against documents, with transfer of title to the Cuban buyer upon receipt of cash payments by the American exporter. It should be noted that no delay has been reported in the implementation of the existing practice.

This measure would represent an escalation designed to hinder the American food and agricultural sales that are already subjected to numerous restrictions imposed by the US.

From December 2001 to February 23, 2005, Alimport had signed on a total of 4.9 million tones, worth US $ 1.255 billion, with freight costs included. Cuba's timely cash payments of US $1.06 billion for these purchases have helped meet the Cuban people's basic food basket needs and conveyed a desire to see a normalization of relations between both countries in an atmosphere of peace and friendship.

Year-to-date, Cuba has imported nearly $90 million worth of American supplies, with an estimated $250 million in contracts that will be implemented in the balance 2005. These numbers could grow significantly as additional contracts are formalized in the course of this year.

Under this procedure, goods earmarked to the Cuban people could apparently be liable to court-ordered seizures in the US to satisfy legally groundless claims against the Republic of Cuba. The measure also ignores the will of the US Congress when it authorized the sales to Cuba.

While the American suppliers are recognized for their quality products and efficiency, to purchase from the US under the new measure would be highly unreliable, for the direct food supplies to the Cuban population, including its children, as well as the procurement of input materials for other food items, would be placed at risk.

The US Treasury pronouncement places the American producers, carriers and port operators in disadvantage and gives ground to competitors in other foreign countries that are keen to develop the Cuban market.

Alimport hereby reiterates its commitment to comply with its existing contractual obligations and its readiness to make further purchases from US businesses, subject to acceptable terms and conditions that are consistent with the international business practices.

Alimport ratifies its confidence in the American farmers, businesspersons, shippers, port operators, legislators and other personalities who over the last three years have shown a will to develop mutually advantageous trading relations with Cuba. Alimport renews its message of peace and friendship to the American people, as well as its wishes for normalized relations between Cuba and the US.

Alimport, February 25, 2005



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