Trump’s New Cuba Policy Is Expected to Partly Rollback Travel and Business Links Relaxed under Obama

Jun 16, 2017

President Donald Trump on Friday will announce a plan to tighten rules on Americans traveling to Cuba and significantly restrict U.S. companies from doing business with Cuban enterprises controlled by the military, senior White House officials said on Thursday.

Trump will lay out his new Cuba policy in a speech in Miami that will roll back parts of former President Barack Obama's opening to the communist-ruled island after a 2014 diplomatic breakthrough between the two former Cold War foes.

Taking a tougher approach against Havana after promising to do so during the presidential campaign, Trump will outline stricter enforcement of an existing ban on Americans going to Cuba as tourists and will seek to prevent U.S. dollars from being used to fund what the new U.S. administration sees as a repressive military-dominated government.

The new policy will ban most U.S. business deals with the Armed Forces Business Enterprises Group (GAESA), a sprawling conglomerate involved in all sectors of the economy, but make exceptions related to air and sea travel, the officials said. This will essentially shield U.S. airlines and cruise lines now serving the island.

But even as he curbs Obama’s détente with Cuba, Trump will stop short of closing embassies or breaking off diplomatic relations restored in 2015 after more than five decades of hostility, U.S. officials said.

He will also leave in place some other tangible measures implemented by his Democratic predecessor, including the resumption of direct U.S.-Cuba commercial flights, though Trump’s more restrictive policy seems certain to dampen new economic ties overall.

For more about U.S.-Cuba business links, watch Fortune's video:

And, according to one White House official, the administration does not intend to “disrupt” existing business deals such as one struck under Obama by Starwood Hotels, which is owned by Marriott International, to manage a historic Havana hotel.

There are also no plans to reinstate the limits that Obama lifted on the amount of the island’s coveted rum and cigars that American can bring home for personal use, one White House official said.

As a result, the changes – though far-reaching – appear to be less sweeping than many pro-engagement advocates had feared.

Human Rights

Trump will justify his partial reversal of Obama’s measures to a large extent on human rights grounds. His aides contend that Obama’s easing of U.S. restrictions has done nothing to advance political freedoms in Cuba, while benefiting the Cuban government financially.

Saying that the aim was to repair what Trump has called a “bad deal” struck by Obama with Havana, one U.S. official said the new administration would leave the door open to improved relations if Cuba undertakes democratic reforms such as allowing free and fair elections and the release of political prisoners.

International human rights groups say, however, that reinstating a U.S. policy of isolating the island could make the situation worse by empowering Cuban hardliners. The Cuban government has made clear it will not be pressured into political reforms in exchange for diplomatic engagement.

At home, Trump’s critics have questioned why his administration is now singling out Cuba for its human rights record while insisting that in other parts of the world it will not lecture other countries on the issue.

Trump will issue a presidential memorandum when he delivers his speech at the Manuel Artime Theater in Miami’s Little Havana district, the heart of America’s Cuban-American and Cuban exile community. The venue is named after a leader of the failed U.S.-backed Bay of Pigs invasion of Cuba in 1961 against Fidel Castro’s revolutionary government.

Republican Senator Marco Rubio, who was played a key role in pushing for Trump’s changes, was expected to attend along with U.S. Representative Mario Diaz-Balart and other Cuban-American lawmakers.

Under Trump’s order, the Treasury and Commerce Departments will be given 30 days to begin writing new regulations and they will not take effect until they are complete.

Under the revised travel policy, U.S. officials say there will be tighter enforcement to make sure Americans legally fit the 12 authorized categories they claim to be traveling under, which could spook many visitors, wary of receiving a hefty fine.

While tourism to Cuba is banned by U.S. law, the Obama administration had been allowing people to travel to Cuba as part of “people to people” educational trips for visitors, a classification that a White House official said was “ripe for abuse” by those looking for beach vacations.

Trump’s new policy will eliminate such visits by individuals while still allowing them to be done as group tours, and also retaining individual travel under other authorized categories such as religious, artistic and journalistic activities, the official said.

But Trump’s planned rollback of Obama’s policy has drawn opposition from American businesses and the travel industry, which have begun making inroads on the island, as well as many lawmakers, including some of Trump’s fellow Republicans.

The new policy has come together after contentious meetings within the administration.

Some aides have argued that Trump, a former real estate magnate who won the presidency promising to unleash U.S. business and create jobs, would have a hard time defending any moves that close off the Cuban market.

But other advisers have contended that it is important to make good on a promise to Cuban-Americans whose support they considered significant in winning Florida in the 2016 election. Miami is home to the largest Cuban-American community.

All products and services featured are based solely on editorial selection. FORTUNE may receive compensation for some links to products and services on this website.

Quotes delayed at least 15 minutes. Market data provided by Interactive Data. ETF and Mutual Fund data provided by Morningstar, Inc. Dow Jones Terms & Conditions: http://www.djindexes.com/mdsidx/html/tandc/indexestandcs.html. S&P Index data is the property of Chicago Mercantile Exchange Inc. and its licensors. All rights reserved. Terms & Conditions. Powered and implemented by Interactive Data Managed Solutions