Exclusive: Travel Industry Reacts to Trump’s Proposed Changes to Cuba Pol

Exclusive: Travel Industry Reacts to Trump’s Proposed Changes to Cuba Pol

In less than an hour, President Donald Trump explained in Miami on Friday how he would essentially undo roughly two years of former President Barack Obama‘s dealings with the communist regime in Cuba.

“We will enforce the ban on tourism, we will enforce the embargo, we will take concrete steps to ensure that investments flow directly to the people so that they can open private businesses and begin to build their country’s great, great future, a country of great potential,” said Trump.

Throughout Friday’s speech, Trump continued to slam Obama’s “one-sided” deal with Cuba and made it clear that he is looking to enforce measures to make sure the Cuban military does not profit from Americans.

“Our policy will seek a much better deal for the Cuban people and for the the United States of America,” said Trump. “We do not want U.S. dollars to prop up a military monopoly that exploits and abuses the citizens of Cuba.”

But the travel industry doesn’t appear to be terribly excited with the proposed changes.

“With each passing day, Trump manages to further alienate the United States from its allies, and makes peace with foreign foes even more difficult to attain,” says travel advisor Marisa Costa, founder of Amiko. “By reversing the Obama policy on Cuba, Trump has again shown that he is more focused on erasing the legacy of the first black president than on making policy decisions that are in the best interest of our nation.”

“I’m against using the American traveling public as pawns in achieving political gains anywhere in the world,” says advisor David Arias, owner of Grand Luxe Travel.

But not all advisors are necessarily against Trump’s proposals.

“President Trump is spot on. The people in Cuba are not benefitting from Americans traveling to Cuba,” says Patricia Stephenson of TravelScapes. “Havana, particularly outside the city, one can see the ruins the country is in, which makes one stop and question, ‘Where is the tourism money going to? Who is benefitting?’ Because it certainly is not the people.”

Zane Kerby, president and CEO of the American Society of Travel Agents (ASTA), issued a statement immediately following Trump’s announcement of changes to regulations governing trade and travel between the U.S. and Cuba.

“ASTA is disappointed with the Trump Administration’s announcement that it plans to turn back the clock on expanded travel and trade between the U.S. and Cuba,” said Kerby. “For our members, much will depend on the details of new Treasury and Commerce Department regulations coming in the next few months, and ASTA plans to fully participate in that process. While challenges remain in terms of Cuba’s readiness for large volumes of American travelers, the past few years have seen a growth in business for U.S. travel agencies, tour operators, airlines, cruise lines, hotel and other travel companies. That progress is now at risk.”

Although not selling Cuba, which has been one of the hottest Caribbean islands for tourism ever since the restrictions were eased, will hurt some business for agents, Katie Rahr Kapel, owner and president of Mode Travel, says it still won’t leave advisors with empty wallets anytime soon. 

“Obviously, having more destinations to work with is desirable, so this is unfortunate for those who’d like to visit the island,” says Kapel. “At the same time, there are so many other great destinations out there that it’s not something that’s going to change much in terms of the business aspect for myself or other agents. We have all survived this long without being able to sell Cuba, so that aspect doesn’t really change.”

For advisor Virgi Schiffino, founder of Lux Voyage, the timing seems a little convenient for Trump.

“In my view, the timing of Trump’s decision to roll back Obama travel policies has more to do with his domestic woes – the Russia probe; the courts striking down his travel ban; and his inability to pass any major legislation – than anything else,” says Schiffino. “This is an easy win for an otherwise embattled president, yet also sets a double standard in our foreign policy.”

Stephen Scott of Travel Hub 365, Inc. says it’s unfortunate because many clients interested in visiting Cuba may now be a little confused about what they can or cannot do while visiting the Caribbean destination. 

“This is certainly going to continue to confuse the traveling public more as there are not enough rooms for large groups,” says Scott. “But that is now one of the only ways to go. Thankfully, cruise business is still in place as that is currently the best option due to the infrastructure.”

Speaking of cruises, two major cruise companies, Carnival Corporation and Royal Caribbean Cruises Ltd., both issued statements at the conclusion of Trump’s speech.

Royal Caribbean announced that there is no impact to any of its cruises to Cuba. 

“Our guests are already enjoying curated people-to-people experiences under the approved categories of travel,” the statement read. “We will continue to review the full and exact scope of the policy changes and any updated regulations during the implementation period which may take several months. Our cruises will continue to be delivered in accordance with U.S. to Cuba travel regulations and we will keep our guests and travel partners informed as we get any additional information. Cruises to Cuba have been very popular with our guests and we look forward to continue sailing to this destination.”

Carnival Corporation also made it clear that its ships will continue to be allowed to sail to Cuba.

“Our experience in Cuba this past year has been extremely positive,” the Carnival statement read. “We look forward to the new cruises being planned for Cuba with Carnival Cruise Line and Holland America Line. We also have requested approval for our other brands to travel to Cuba. Travel brings people and cultures together, so we are excited about the upcoming cruises to Cuba for our guests.”

Department of the Treasury Breaks Down New Cuba Policies

Still confused about what President Trump’s Miami speech on Friday means to Cuba travel? The Department of Treasury released answers to some frequently asked questions regarding Trump’s Cuba announcement.

Here’s what you need to know:

1. How will OFAC implement the changes to the Cuba sanctions program announced
by the President on June 16, 2017? Are the changes effective immediately?

OFAC will implement the Treasury-specific changes via amendments to its Cuban Assets
Control Regulations. The Department of Commerce will implement any necessary
changes via amendments to its Export Administration Regulations. OFAC expects to
issue its regulatory amendments in the coming months. The announced changes do not
take effect until the new regulations are issued.

2. What is individual people-to-people travel, and how does the President’s
announcement impact this travel authorization?

Individual people-to-people travel is educational travel that: (i) does not involve
academic study pursuant to a degree program; and (ii) does not take place under the
auspices of an organization that is subject to U.S. jurisdiction that sponsors such
exchanges to promote people-to-people contact. The President instructed Treasury to
issue regulations that will end individual people-to-people travel. The announced
changes do not take effect until the new regulations are issued.

3. Will group people-to-people travel still be authorized?

Yes. Group people-to-people travel is educational travel not involving academic study
pursuant to a degree program that takes place under the auspices of an organization that is
subject to U.S. jurisdiction that sponsors such exchanges to promote people-to-people
contact.

Travelers utilizing this travel authorization must maintain a full-time schedule of
educational exchange activities that are intended to enhance contact with the Cuban
people, support civil society in Cuba, or promote the Cuban people’s independence from
Cuban authorities, and that will result in meaningful interaction between the traveler and
individuals in Cuba. An employee, consultant, or agent of the group must accompany
each group to ensure that each traveler maintains a full-time schedule of educational
exchange activities.

4. How do the changes announced by the President on June 16, 2017 affect individual
people-to-people travelers who have already begun making their travel
arrangements (such as purchasing flights, hotels, or rental cars)?

The announced changes do not take effect until OFAC issues new regulations. Provided
that the traveler has already completed at least one travel-related transaction (such as
purchasing a flight or reserving accommodation) prior to the President’s announcement
on June 16, 2017, all additional travel-related transactions for that trip, whether the trip
occurs before or after OFAC’s new regulations are issued, would also be authorized,
provided the travel-related transactions are consistent with OFAC’s regulations as of June
16, 2017.

5. How do the changes announced by the President on June 16, 2017 affect other
authorized travelers to Cuba whose travel arrangements may include direct
transactions with entities related to the Cuban military, intelligence, or security
services that may be implicated by the new Cuba policy?

The announced changes do not take effect until OFAC issues new regulations.
Consistent with the Administration’s interest in not negatively impacting Americans for
arranging lawful travel to Cuba, any travel-related arrangements that include direct
transactions with entities related to the Cuban military, intelligence, or security services
that may be implicated by the new Cuba policy will be permitted provided that those
travel arrangements were initiated prior to the issuance of the forthcoming regulations.

6. How do the changes announced by the President on June 16, 2017 affect companies
subject to U.S. jurisdiction that are already engaged in the Cuban market and that
may undertake direct transactions with entities related to the Cuban military,
intelligence, or security services that may be implicated by the new Cuba policy?

The announced changes do not take effect until OFAC issues new regulations.
Consistent with the Administration’s interest in not negatively impacting American
businesses for engaging in lawful commercial opportunities, any Cuba-related
commercial engagement that includes direct transactions with entities related to the
Cuban military, intelligence, or security services that may be implicated by the new Cuba
policy will be permitted provided that those commercial engagements were in place prior
to the issuance of the forthcoming regulations.

7. Does the new policy affect how persons subject to U.S jurisdiction may purchase
airline tickets for authorized travel to Cuba?

No. The new policy will not change how persons subject to U.S. jurisdiction traveling to
Cuba pursuant to the 12 categories of authorized travel may purchase their airline tickets.

8. Can I continue to send authorized remittances to Cuba?

Yes. The announced policy changes will not change the authorizations for sending
remittances to Cuba.

Additionally, the announced changes include an exception that will
allow for transactions incidental to the sending, processing, and receipt of authorized
remittances to the extent they would otherwise be restricted by the new policy limiting
transactions with certain identified Cuban military, intelligence, or security services. As
a result, the restrictions on certain transactions in the new Cuba policy will not limit the
ability to send or receive authorized remittances.

9. How does the new policy impact other authorized travel to Cuba by persons subject
to U.S. jurisdiction?

The new policy will not result in changes to the other (non-individual people-to-people)
authorizations for travel.

Following the issuance of OFAC’s regulatory changes, travel-related transactions with
prohibited entities identified by the State Department generally will not be permitted.
Guidance will accompany the issuance of the new regulations.

10. How will the new policy impact existing OFAC specific licenses?

The forthcoming regulations will be prospective and thus will not affect existing
contracts and licenses.

11. How will U.S. companies know if their Cuban counterpart is affiliated with a
prohibited entity or sub-entity in Cuba?

The State Department will be publishing a list of entities with which direct transactions
generally will not be permitted. Guidance will accompany the issuance of the new
regulations. The announced changes do not take effect until the new regulations are
issued.

12. Is authorized travel by cruise ship or passenger vessel to Cuba impacted by the new
Cuba policy?

Persons subject to U.S. jurisdiction will still be able to engage in authorized travel to
Cuba by cruise ship or passenger vessel.

Following the issuance of OFAC’s regulatory changes, travel-related transactions with
prohibited entities identified by the State Department generally will not be permitted.
Guidance will accompany the issuance of the new regulations.

Keep visiting www.travelagentcentral.com for all your latest travel news and be sure to follow Travel Agent’s Joe Pike on Twitter @TravelPike and Instagram @pike5260

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