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Statements on Introduced Bills and Joint Resolutions

Location: Washington, DC




S. 634. A bill to amend the Trade Sanctions Reform and Export Enhancement Act of 2000 to clarify allowable payment terms for sales of agricultural commodities and products to Cuba; to the Committee on Foreign Relations.

Mr. CHAMBLISS. Mr. President, today I rise to introduce legislation to reverse the unilateral change by the Department of Treasury's Office of Foreign Assets Control (OFAC) that threatens future sales of U.S. agricultural products to Cuba.

Four years ago, Congress passed the Trade Sanctions Reform and Export Enhancement Act (TSREEA), allowing sales of food and medicine to Cuba for the first time in nearly four decades. The Act did not signal an end to the embargo or efforts to do so but merely exempted food and medicine from unilateral sanctions that harm local populations.

Cuba first purchased U.S. agricultural products under the new authorities in December 2001. Since that time, Cuba has contracted to purchase approximately $1.25 billion worth of U.S. agricultural goods. According to the U.S. Department of Agriculture, U.S. agriculture, fish and forest product exports to Cuba in fiscal year 2004 totaled $402 million, up 115 percent from a year earlier. The leading export items last year were rice, $65 million, poultry meat, $62 million, wheat, $57 million, corn, $51 million, and soybeans, $38 million, from more than 40 States in this country. Although U.S. agricultural trade with Cuba experienced tremendous growth in the past four years, the future is now in doubt.

Late last year, OFAC and the State Department started considering actions to further tighten trade requirements on Cuba. At issue is the term ``cash in advance'' and the sale of licensed agricultural products. On February 22, 2005, after repeated urgings by Members of Congress to the contrary, OFAC amended the Cuban Assets Control Regulations to clarify the term whereby goods cannot leave the U.S. port at which they are loaded until payment is received by the seller or the seller's agent. The interpretation by OFAC runs counter to general trade practices and will likely shut down U.S. agricultural exports to Cuba.

Currently, U.S. exporters require payment before turning over title and control of the goods. The exporters routinely ship U.S. goods to Cuba where they remain under the custody of the seller until such time as the seller certifies full payment. Only then are the goods released to Cuba. At no time is credit extended in any form to Cuba. This standard method of doing business has been in practice since sales to Cuba began.

TSREEA was meant to expand access for agricultural producers to the Cuban market. By taking into consideration the unique nature of agriculture trade with Cuba, my legislation intends to overturn OFAC's new definition of ``cash in advance''. We should not be making it harder to export agricultural products when the United States is experiencing a massive trade deficit. I am committed to helping expand opportunities at home and abroad for our nation's farmers and ranchers. I look forward to working with my colleagues in the Senate on this important issue.

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