tag:theconversation.com,2011:/ca/topics/embargo-2103/articlesEmbargo – The Conversation2019-08-07T17:13:22Ztag:theconversation.com,2011:article/1215382019-08-07T17:13:22Z2019-08-07T17:13:22Z5 reasons why Trump’s Venezuela embargo won’t end the Maduro regime<p>The U.S. has <a href="https://www.cnn.com/2019/08/05/politics/trump-economic-embargo-venezuela/index.html">announced</a> an economic embargo on Venezuela, intended to put an end to President Nicolás Maduro’s authoritarian regime. </p>
<p>In an Aug. 5 <a href="https://www.whitehouse.gov/presidential-actions/executive-order-blocking-property-government-venezuela/">executive order</a>, President Donald Trump said that the tough new sanctions – which target any company or individual outside of Venezuela doing business directly or indirectly with Maduro’s government – were a response to the Maduro regime’s “continued usurpation of power” and “human rights abuses.” </p>
<p>All Venezuelan government assets in the United States are also now frozen. </p>
<p>The new measures represent a significant escalation from <a href="https://www.treasury.gov/resource-center/sanctions/programs/pages/venezuela.aspx">previous sanctions</a>, which mainly targeted government officials and some key industries such as oil and gas, gold and finance.</p>
<p>But my <a href="https://theconversation.com/profiles/marco-aponte-moreno-134249">analysis of Venezuela’s political and economic crisis</a> suggests that an embargo alone will not provoke Maduro’s ouster. Here are five reasons why.</p>
<h2>1. Venezuela’s economy is already broken</h2>
<p>Embargos are a <a href="https://www.cfr.org/backgrounder/what-are-economic-sanctions">foreign policy tool</a> meant to pressure rogue governments into changing their ways by cutting off their cash flow.</p>
<p>It’s too late for that in Venezuela. </p>
<p>After years of mismanagement and corruption by the Maduro government, Venezuela’s economy is in <a href="https://theconversation.com/inside-venezuelas-economic-collapse-80597">shambles</a>. The GDP has contracted by <a href="https://www.bbc.com/news/world-latin-america-46999668">more than 15% every year since 2016</a>. Hyperinflation hit <a href="https://www.cnbc.com/2019/08/02/venezuela-inflation-at-10-million-percent-its-time-for-shock-therapy.html">10 million percent</a> in 2019. </p>
<p>Maduro’s cash-strapped government <a href="https://www.forbes.com/sites/francescoppola/2017/11/14/venezuela-defaults/#3806fbe62755">defaulted on its dollar-based bonds</a> in 2017. This year it has <a href="https://www.bloomberg.com/news/articles/2019-06-04/venezuela-is-said-to-default-on-gold-swap-with-deutsche-bank">failed to make payments on US$1.85 billion</a> that Deutsche Bank and Citigroup loaned Venezuela using the regime’s gold as collateral. Venezuela’s government is nearly bankrupt.</p>
<p>But since this economic decline has happened gradually, beginning in 2014, wealthy Venezuelans – especially corrupt government officials – have already <a href="https://www.gazetadopovo.com.br/wiseup-news/who-are-venezuelas-wealthy/">put their money overseas</a>, primarily in European markets. For example, Venezuelans own some <a href="https://www.nytimes.com/2018/07/29/world/europe/spain-property-boom-venezuela.html">7,000 luxury apartments</a> in Madrid, according to The New York Times. </p>
<p>American sanctions just can’t hurt Venezuela’s ruling class the way they might have several years ago.</p>
<h2>2. The embargo leaves some cash flows untouched</h2>
<p>Trump’s harsh new sanctions on Venezuela are not a full trade embargo like the Cuba embargo, which has almost totally <a href="https://insightcuba.com/faq/trade-embargo-cuba">isolated the island from world markets since 1962</a>. </p>
<p>Imports and exports with the private sector – a <a href="https://www.washingtonpost.com/politics/trump-freezes-venezuela-govt-assets-in-escalation/2019/08/05/f8f4dd0a-b7eb-11e9-8e83-4e6687e99814_story.html">still sizable market</a> despite Maduro’s socialist policies – will continue to flow freely, as will remittances from Venezuelans living abroad. </p>
<p>These two income sources both come in dollars, which is far more stable and valuable than the local currency. Combined, they can keep the ailing Venezuelan economy afloat for some time. </p>
<p>An incomplete embargo, in other words, will not provoke complete economic collapse. </p>
<figure class="align-center zoomable">
<a href="https://images.theconversation.com/files/287182/original/file-20190807-144878-1a84vcw.jpg?ixlib=rb-1.1.0&q=45&auto=format&w=1000&fit=clip"><img alt="" src="https://images.theconversation.com/files/287182/original/file-20190807-144878-1a84vcw.jpg?ixlib=rb-1.1.0&q=45&auto=format&w=754&fit=clip" srcset="https://images.theconversation.com/files/287182/original/file-20190807-144878-1a84vcw.jpg?ixlib=rb-1.1.0&q=45&auto=format&w=600&h=400&fit=crop&dpr=1 600w, https://images.theconversation.com/files/287182/original/file-20190807-144878-1a84vcw.jpg?ixlib=rb-1.1.0&q=30&auto=format&w=600&h=400&fit=crop&dpr=2 1200w, https://images.theconversation.com/files/287182/original/file-20190807-144878-1a84vcw.jpg?ixlib=rb-1.1.0&q=15&auto=format&w=600&h=400&fit=crop&dpr=3 1800w, https://images.theconversation.com/files/287182/original/file-20190807-144878-1a84vcw.jpg?ixlib=rb-1.1.0&q=45&auto=format&w=754&h=503&fit=crop&dpr=1 754w, https://images.theconversation.com/files/287182/original/file-20190807-144878-1a84vcw.jpg?ixlib=rb-1.1.0&q=30&auto=format&w=754&h=503&fit=crop&dpr=2 1508w, https://images.theconversation.com/files/287182/original/file-20190807-144878-1a84vcw.jpg?ixlib=rb-1.1.0&q=15&auto=format&w=754&h=503&fit=crop&dpr=3 2262w" sizes="(min-width: 1466px) 754px, (max-width: 599px) 100vw, (min-width: 600px) 600px, 237px"></a>
<figcaption>
<span class="caption">The U.S. embargo is sure to be unpopular in Venezuela. A wall in Caracas reads, ‘Trump, un-embargo Venezuela.’</span>
<span class="attribution"><a class="source" href="http://www.apimages.com/metadata/Index/Venezuela-Executive-Order/6010ad273b83495897ff4d528ae3b38d/5/0">AP Photo/Leonardo Fernandez</a></span>
</figcaption>
</figure>
<h2>3. The poor, not the regime, will be hurt the most</h2>
<p>Venezuelans with <a href="https://www.theguardian.com/world/2019/mar/13/venezuela-hyperinflation-bolivar-banknotes-dollars">access to dollars</a> – through remittances or savings squirreled away before the crisis – are surviving this crisis. They can afford food, medicine and gasoline, and buy other goods to barter. </p>
<p>But most Venezuelans today are desperately poor. According to the United Nations, <a href="https://borgenproject.org/top-10-facts-about-poverty-in-venezuela/">90% of people there live in poverty</a>. That’s double what it was in 2014.</p>
<p>The Venezuelan minimum wage of roughly $7 per month is not enough to cover a family’s basic needs. As a result, malnutrition is spreading. Last year, Venezuelans reported <a href="https://borgenproject.org/top-10-facts-about-poverty-in-venezuela/">losing an average of 25 pounds</a>, and two-thirds said they <a href="https://borgenproject.org/top-10-facts-about-poverty-in-venezuela/">go to bed hungry</a>.</p>
<p>The majority of Venezuelans rely on the government to eat. Its monthly <a href="https://www.reuters.com/article/us-venezuela-politics-food/for-poor-venezuelans-a-box-of-food-may-sway-vote-for-maduro-idUSKCN1GO173">delivery of heavily subsidized food and basic goods</a> known as “CLAP” is a lifeline to the poor. If the government runs out of money, poor people will feel it the most – not the government officials and other Venezuelans with <a href="https://www.theguardian.com/world/2019/mar/13/venezuela-hyperinflation-bolivar-banknotes-dollars">access to dollars</a>. </p>
<figure class="align-center ">
<img alt="" src="https://images.theconversation.com/files/287109/original/file-20190806-84225-1pk34ph.jpg?ixlib=rb-1.1.0&q=45&auto=format&w=754&fit=clip" srcset="https://images.theconversation.com/files/287109/original/file-20190806-84225-1pk34ph.jpg?ixlib=rb-1.1.0&q=45&auto=format&w=600&h=400&fit=crop&dpr=1 600w, https://images.theconversation.com/files/287109/original/file-20190806-84225-1pk34ph.jpg?ixlib=rb-1.1.0&q=30&auto=format&w=600&h=400&fit=crop&dpr=2 1200w, https://images.theconversation.com/files/287109/original/file-20190806-84225-1pk34ph.jpg?ixlib=rb-1.1.0&q=15&auto=format&w=600&h=400&fit=crop&dpr=3 1800w, https://images.theconversation.com/files/287109/original/file-20190806-84225-1pk34ph.jpg?ixlib=rb-1.1.0&q=45&auto=format&w=754&h=503&fit=crop&dpr=1 754w, https://images.theconversation.com/files/287109/original/file-20190806-84225-1pk34ph.jpg?ixlib=rb-1.1.0&q=30&auto=format&w=754&h=503&fit=crop&dpr=2 1508w, https://images.theconversation.com/files/287109/original/file-20190806-84225-1pk34ph.jpg?ixlib=rb-1.1.0&q=15&auto=format&w=754&h=503&fit=crop&dpr=3 2262w" sizes="(min-width: 1466px) 754px, (max-width: 599px) 100vw, (min-width: 600px) 600px, 237px">
<figcaption>
<span class="caption">Venezuelan National Militia members carry boxes of subsidized food for distribution across the capital of Caracas, July 5, 2019.</span>
<span class="attribution"><a class="source" href="http://www.apimages.com/metadata/Index/Venezuela-Independence-Day/83058532fb664fe88fe46bd1f2507378/2/0">AP Photos/Ariana Cubillos</a></span>
</figcaption>
</figure>
<h2>4. China and Russia still support Venezuela</h2>
<p>Maduro has few international allies. When the Trump administration led efforts earlier this year to <a href="https://theconversation.com/venezuela-power-struggle-plunges-nation-into-turmoil-3-essential-reads-110419">recognize opposition leader Juan Guaidó as the legitimate president of Venezuela</a>, 60 countries joined it.</p>
<p>But China and Russia continue to be the Venezuela’s most powerful international boosters and have bailed out Maduro by giving his government <a href="https://www.washingtonpost.com/politics/2019/02/22/china-russia-have-deep-financial-ties-venezuela-heres-whats-stake/">massive loans</a> in the past. Both have <a href="https://www.euronews.com/2019/02/28/watch-live-un-security-council-votes-on-rival-us-russian-proposals-on-venezuela">vetoed every U.S. effort to pass resolutions against Maduro’s government</a> within the United Nations. </p>
<p>China has exploited <a href="https://www.washingtonpost.com/politics/2019/02/22/china-russia-have-deep-financial-ties-venezuela-heres-whats-stake/">Venezuela’s vast natural resources</a> for profit. Russia has made the South American nation a strategic geopolitical partner in the Western Hemisphere, a key ally in its <a href="https://www.nytimes.com/2019/03/08/world/americas/russia-venezuela-maduro-putin.html">efforts to undermine American influence</a>. </p>
<p>Neither of the two countries are likely to comply with an economic embargo to Venezuela. Analysts expect them to <a href="https://www.miamiherald.com/news/nation-world/world/americas/venezuela/article233590982.html">continue buying oil, gold</a> and other valuable commodities from Maduro’s regime, providing much-needed cash to his government.</p>
<h2>5. Remember Cuba?</h2>
<p>Embargoes rarely produce regime change of the sort Trump seeks in Venezuela. </p>
<p>Just consider Cuba, which this year celebrated the 66th anniversary of its communist revolution – 57 years after the Kennedy government imposed a <a href="https://www.treasury.gov/resource-center/sanctions/programs/pages/cuba.aspx">trade embargo against it</a>. The Cuba embargo didn’t end the Castro regime; it fueled anti-American sentiment, handing the Castros an easy scapegoat for all the country’s problems – thereby <a href="https://www.nationalgeographic.com/news/2014/12/141217-cuba-united-states-relations-culture-reaction-castro-obama-world/">improving the government’s own popularity</a>.</p>
<p>An embargo will almost surely do the same in Venezuela. Trump has given Maduro even <a href="https://www.forbes.com/sites/kenrapoza/2019/02/15/maduro-blames-trump-for-venezuelas-great-depression/">more ammunition to blame the U.S.</a> for his country’s economic woes. </p>
<p>Maduro has been <a href="https://www.nytimes.com/2015/03/12/world/americas/venezuela-nicolas-maduro-obama.html">doing that for years</a> anyway. Now, he won’t be totally wrong.</p><img src="https://counter.theconversation.com/content/121538/count.gif" alt="The Conversation" width="1" height="1" />
<p class="fine-print"><em><span>Marco Aponte-Moreno does not work for, consult, own shares in or receive funding from any company or organization that would benefit from this article, and has disclosed no relevant affiliations beyond their academic appointment.</span></em></p>For one, you can’t break an economy that’s already broken.Marco Aponte-Moreno, Associate Professor of Global Business and Board Member of the Institute for Latino and Latin American Studies, St Mary's College of California Licensed as Creative Commons – attribution, no derivatives.tag:theconversation.com,2011:article/989342018-07-03T08:45:34Z2018-07-03T08:45:34ZA self-reliant defence industry: a mission impossible for Indonesia?<p>Indonesia is aiming to meet its own defence needs and not be reliant on other countries for military equipment by <a href="http://www.bbc.com/indonesia/berita_indonesia/2013/07/130614_indonesiandefenceindustry">2029</a>.</p>
<p>The biggest economy in Southeast Asia set up a <a href="https://nasional.kompas.com/read/2010/04/16/21580988/Pemerintah.Bentuk.KKIP">coordinating committee</a> in 2010 to create a <a href="https://www.antaranews.com/berita/693176/indonesia-bangun-kemandirian-industri-pertahanan">master plan</a> to develop its defence industry. In 2012, the government also issued a supporting law.</p>
<p>But, Indonesia’s defence industry remains stagnant. What’s holding Indonesia back and is it possible for the country to develop a self-sustaining defence industry?</p>
<h2>Most attractive defence market</h2>
<p>Indonesia has been touted as <a href="https://www.businesswire.com/news/home/20171003006209/en/Future-Indonesia-Defense-Industry-2022---Market">the most attractive defence market in Southeast Asia</a> as it deals with terrorism, illegal fishing, piracy, drug smuggling and other crimes.</p>
<p>Having a self-supporting defence industry is important for Indonesia as military equipment are expensive. Importing them from other countries takes a large chunk of the state budget. In <a href="http://www.anggaran.depkeu.go.id/peraturan/Perpres_107_2017_Rincian_APBN_2018.rar">2018 state budget</a>, the Defence Ministry secured the largest budget allocation at <a href="https://databoks.katadata.co.id/datapublish/2018/02/07/apbn-2018-kementerian-pertahanan-masih-menjadi-prioritas">Rp107.7 trillion</a> (US$6.9 billion), more than the Health Ministry (Rp59.1 trillion), the Research and Technology Ministry (Rp41.3 trillion), and the Education and Culture Ministry (Rp40.1 trillion). </p>
<p>It’s also important for Indonesia to be self-reliant to anticipate possible <a href="http://www.nbcnews.com/id/10168487/ns/world_news-south_and_central_asia/t/us-lifts-arms-embargo-against-indonesia/#.WznNudgzYWo">embargos from other countries</a>.</p>
<h2>Indonesia’s defence industry: where are we at?</h2>
<p>Indonesia’s defence industry reached its peak during the New Order regime under the strong leadership of then research and technology minister <a href="https://books.google.co.id/books?id=ziBBDwAAQBAJ&pg=PT422&lpg=PT422&dq=habibie+indonesia+defense+industrialization&source=bl&ots=1XkLLpxigs&sig=_7-8RKcyF6UVDVyrAB0HNrFb4VI&hl=en&sa=X&ved=0ahUKEwj48cnGnfbbAhUBOisKHbjsCz8Q6AEIKTAA#v=onepage&q=habibie%20indonesia%20defense%20industrialization&f=false">B.J. Habibie</a>. During his tenure, he declared the defence industry as a strategic sector.</p>
<p>During the New Order era, the government established several big players of Indonesia’s defence industry such as the aircraft manufacturer IPTN (now Dirgantara Indonesia). IPTN developed the <a href="https://regional.kompas.com/read/2018/05/05/10595021/cn-235-mpa-pesawat-intai-canggih-buatan-anak-negeri-tambah-kekuatan">CN-235</a> transport aircraft in the 1980s. It also came close to pioneer Indonesia’s own small passenger aircraft <a href="https://en.tempo.co/read/news/2013/09/30/056517776/Habibie-to-Launch-R-80-Airplane-in-2016">N-250</a>, having built two prototypes in 1996.</p>
<p>However, the 1997 Asian financial crisis destroyed the industry.</p>
<p>The country’s defence industry began to recover slowly. But Indonesia continues to be a <a href="https://www.antaranews.com/berita/693176/indonesia-bangun-kemandirian-industri-pertahanan">major importing country for military equipment</a>.</p>
<p>The latest data from the <a href="https://www.sipri.org/databases/milex">Stockholm International Peace Reseach Institute military expenditure database</a> in 2016 stated Indonesia allocated US$8.18 billion for defence spending, the second highest in Southeast Asia after Singapore at $9.96 billion.</p>
<p>Despite spending the most in Southeast Asia, Indonesia’s military expenditure is still below 1% of its Gross Domestic Product (GDP), among the lowest in the region. A state’s military spending is usually set at 2-3% of each country’s GDP.</p>
<p>Under Jokowi, Indonesia plans to raise the defence budget to <a href="https://thediplomat.com/2015/01/an-indonesian-defense-revolution-under-jokowi/">1.5% of GDP</a> to spend more on research and development for military equipment.</p>
<h2>Indonesia’s defence industry outlook</h2>
<p>Indonesia’s defence industry players include state-owned enterprises and private companies. Their businesses range from producing main equipment and components, supplying raw material to conducting maintenance and repair.</p>
<p>Big players include state-owned weapon manufacturer <a href="https://www.pindad.com/">Pindad</a> that handles ground military equipment, state-owned shipbuilder <a href="https://www.pal.co.id/">PAL</a> for naval systems and state aircraft manufacturer <a href="https://www.indonesian-aerospace.com/">Dirgantara Indonesia</a> for aerospace systems.</p>
<p>Their biggest clients are the Defence Ministry, the Armed Forces, and the Police. They have also sold equipment to other countries.</p>
<p>Pindad has exported assault rifles to Bangladesh and United Arab Emirates. It has also exported <em>Anoa</em> armoured vehicles to <a href="https://books.google.co.id/books/about/Membangun_Kemandirian_Industri_Pertahana.html?id=VKnFrQEACAAJ&redir_esc=y">Brunei, Pakistan, and Timor Leste</a>.</p>
<p>PAL has exported warships to <a href="https://ekonomi.kompas.com/read/2017/05/02/063005326/pt.pal.kirim.kapal.perang.pesanan.filipina">the Philippines</a>.</p>
<p>Meanwhile, Dirgantara Indonesia has exported aircrafts to <a href="https://ekonomi.kompas.com/read/2017/03/13/160549726/ini.daftar.pesawat.kiriman.pt.dirgantara.indonesia.41.tahun.terakhir">ten countries</a>: Thailand, Brunei, Philippines, South Korea, Vietnam, Malaysia, United Arab Emirates, Senegal, Burkina Faso, and Venezuela.</p>
<p>But these local companies have yet been able to meet the local demand from government agencies as their products are not equipped with advanced technology. </p>
<p>For defence equipment on land, Indonesia still needs to import battle tanks from Germany. In terms of naval system, despite our local industry’s capability in producing fast attack missile boats, offshore patrol vessels, light frigates, and landing platform docks, we still need to import frigates, corvettes and submarines from the Netherlands, the UK, and Germany.</p>
<p>Indonesia still imports all of its fighter aircrafts, including F-16 and F-5 fighter jets from the US and Sukhoi jets from Russia. Indonesia’s marine patrol and transport aircrafts still come from the US and Spain. Indonesia also imports trainer aircrafts from the UK, Italy and South Korea.</p>
<p>The diverse suppliers of aircrafts creates <a href="https://www.rsis.edu.sg/rsis-publication/idss/2211-indonesias-sukhoi-acquisition/#.WzpoOqczbIU">problems</a> in <a href="https://www.rsis.edu.sg/wp-content/uploads/2014/09/PR_140709_Rethinking-TNI-AU.pdf">spares compatibility</a>.</p>
<p>Even though the majority of Indonesia’s military equipment still depends on foreign suppliers, the local industry players have also made some improvements in showing its potential.</p>
<p>Pindad is developing <em>Kaplan</em> medium tanks with Turkey. PAL is producing <em>Chang Bogo</em>-class submarines jointly with South Korean firm Daewoo. Dirgantara Indonesia has secured licenses to build H225M, NAS332, and SA330 helicopters for the Air Force. </p>
<h2>Problems</h2>
<p>Despite its potential, Indonesia’s defence industry still faces challenges.</p>
<p>Funding for research and development in defence technology in Indonesia is lacking. Because of this, it remains difficult for Indonesia to develop state-of-the-art technology for its military products, making them less competitive in the global market. The uncertainties in getting orders from local market has made the industry players reluctant to heavily invest in research as companies must bear the risks associated with research failures.</p>
<p>This has caused a rocky relationship between defence industry players and their local costumers. The Armed Forces often complain about the quality of local products, resulting in them buying from other countries.</p>
<p>This case occurred when the Indonesian Air Force bought <a href="http://www.thejakartapost.com/academia/2017/02/09/revisiting-military-and-industrial-relations.html">AW101 helicopters</a> from the Anglo-Italian company Leonardo-Finmeccanica last year, despite Dirgantara Indonesia having the capability to produce similar products.</p>
<p>Other challenges include contract and regulatory uncertainties. This results in many contracts being postponed or cancelled.</p>
<p>Recently, the deal between South Korea and Indonesia to develop fighter aircrafts was <a href="https://international.sindonews.com/read/1303926/40/proyek-jet-tempur-indonesia-korsel-if-x-dilaporkan-porak-poranda-1525753223">put on hold</a> due to contract disagreements. Previously, the deal was delayed due to various reasons, including financial and administrative issues, as well as political conditions.</p>
<h2>Possible solutions</h2>
<p>To achieve its goals of self-sufficiency, Indonesia should first address problems hindering the development of the country’s defence industry.</p>
<p>First, if the government plans to increase the budget allocation for military, it should allocate its portion of the state budget for research and development programs for military weaponry.</p>
<p>The government must also support local industry players by giving them guarantees through legal instruments and incentives. Under these incentives, the government may require the Defence Ministry, the Armed Forces, and the Police to procure military equipment from local players only.</p>
<p>The government should also facilitate better relationship between the defence industry players and the Armed Forces.</p>
<p>With these steps, Indonesia will be one step closer to having a self-reliant defence industry.</p><img src="https://counter.theconversation.com/content/98934/count.gif" alt="The Conversation" width="1" height="1" />
<p class="fine-print"><em><span>Tangguh Chairil is affiliated with the working group on strategis and high-technology industry of the National Committee for Economy and Industry.</span></em></p>Can Indonesia’s defence industry attain self-sufficiency?Tangguh Chairil, Lecturer in International Relations, Binus UniversityLicensed as Creative Commons – attribution, no derivatives.tag:theconversation.com,2011:article/983872018-07-02T20:09:11Z2018-07-02T20:09:11ZFears about China’s influence are a rerun of attitudes to Japan 80 years ago<p>July 1 marked the 80th anniversary of Australia’s iron ore embargo against Japan. The <a href="http://www.nma.gov.au/online_features/defining_moments/featured/iron_ore_exports">official reason</a> was resource conservation, but the ban was really driven by a fear of Japan – which had been buying up assets like iron ore and scrap metal – gaining a stronghold in Australia that threatened our sovereignty and security. </p>
<p>Despite the passing of 80 years, Australia is having the same discussions we had back in 1938, only this time about China. </p>
<p>China’s growing commercial influence in Australia and other Asia-Pacific countries has sparked concerns about its political ambitions. Responding to these concerns with economic sanctions is likely only to pander to US desires to curb Chinese influence, placing Australia’s economic future and regional security at risk. </p>
<p>The <a href="https://www.nytimes.com/2014/08/22/opinion/when-sanctions-lead-to-war.html">economic sanctions Japan faced</a> in the 1930s and early 1940s contributed in large part to the outbreak of the Pacific War. </p>
<p>With the recent <a href="https://theconversation.com/whats-at-stake-in-the-tariff-negotiations-between-the-us-and-china-95876">tit-for-tat US and Chinese trade restrictions</a>, is the world heading down a similar path? </p>
<h2>What can we do differently this time around?</h2>
<p>Australia must recast its foreign policy with a view to the role it wishes to play in its immediate region. This needs to be a little more adventurous than the <a href="https://www.fpwhitepaper.gov.au/foreign-policy-white-paper">2017 Foreign Policy White Paper</a>.</p>
<p>The Australia of the 1930s faced a region in flux. There were territorial disputes, the waning power of Britain – Australia’s primary ally and protector – and the growing military and commercial weight of regional power Japan, whose intentions remained unclear. Sound familiar? </p>
<p>In early 1937, fears emerged of a world steel shortage. While iron ore restrictions were being introduced elsewhere, the <a href="https://trove.nla.gov.au/newspaper/article/177403198?searchTerm=world%20steel%20shortages%201937%20%20%20%20%20%20%20%20%20%20%20%20&searchLimits=l-decade=193%7C%7C%7Cl-year=1937">Australian government maintained</a> that it was not a lack of resources that had created a shortage but an inadequate output. </p>
<p>It came as quite a surprise then, in May 1938, when the Australian government announced an embargo on iron ore exports, effective July 1 1938. The government cited a (then) recent and very <a href="https://trove.nla.gov.au/newspaper/article/40994459?searchTerm=iron%20ore%20embargo%20%20%20%20%20%20%20%20%20%20%20%20&searchLimits=l-decade=193%7C%7C%7Cl-year=1938%7C%7C%7Cl-month=5">brief report</a>, compiled by the Commonwealth government geological adviser, which concluded iron ore deposits were much smaller than had been estimated and perhaps would not meet domestic needs. </p>
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Read more:
<a href="https://theconversation.com/australia-is-hedging-its-bets-on-china-with-the-latest-foreign-policy-white-paper-88009">Australia is hedging its bets on China with the latest Foreign Policy White Paper</a>
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<p>The embargo included existing agreements with foreign investors, such as the <a href="https://trove.nla.gov.au/newspaper/article/17468755?searchTerm=iron%20ore%20embargo%20%20%20%20%20%20%20%20%20%20%20%20&searchLimits=l-decade=193%7C%7C%7Cl-year=1938%7C%7C%7Cl-title=35">Japanese lease at the Yampi Sound</a> mines in Western Australia, where preparations for the first iron ore extraction were well under way. </p>
<p>The government stressed that the embargo was not due to anti-Japanese sentiment. Nevertheless, this was the conclusion the Japanese government drew as it tried and failed to secure access to the Yampi Sound project. </p>
<p>The size of Australia’s current iron ore exports calls into question the logic of this report and the export ban it led to. </p>
<h2>A foreign foothold in Australian territory</h2>
<p>Throughout the 1930s, Japan pursued a <a href="http://www.bbc.co.uk/history/worldwars/wwtwo/japan_quest_empire_01.shtml">policy of southward expansion</a>, both territorial and economic in nature. At the centre of this policy was the need for resources to cater for Japan’s rapidly growing population. This involved the “economic penetration” of Far Eastern nations, investing Japanese capital to secure essential goods. </p>
<p>Australia, still recovering from the Great Depression, welcomed these investments.</p>
<figure class="align-center ">
<img alt="" src="https://images.theconversation.com/files/223755/original/file-20180619-126534-53upal.JPG?ixlib=rb-1.1.0&q=45&auto=format&w=754&fit=clip" srcset="https://images.theconversation.com/files/223755/original/file-20180619-126534-53upal.JPG?ixlib=rb-1.1.0&q=45&auto=format&w=600&h=450&fit=crop&dpr=1 600w, https://images.theconversation.com/files/223755/original/file-20180619-126534-53upal.JPG?ixlib=rb-1.1.0&q=30&auto=format&w=600&h=450&fit=crop&dpr=2 1200w, https://images.theconversation.com/files/223755/original/file-20180619-126534-53upal.JPG?ixlib=rb-1.1.0&q=15&auto=format&w=600&h=450&fit=crop&dpr=3 1800w, https://images.theconversation.com/files/223755/original/file-20180619-126534-53upal.JPG?ixlib=rb-1.1.0&q=45&auto=format&w=754&h=566&fit=crop&dpr=1 754w, https://images.theconversation.com/files/223755/original/file-20180619-126534-53upal.JPG?ixlib=rb-1.1.0&q=30&auto=format&w=754&h=566&fit=crop&dpr=2 1508w, https://images.theconversation.com/files/223755/original/file-20180619-126534-53upal.JPG?ixlib=rb-1.1.0&q=15&auto=format&w=754&h=566&fit=crop&dpr=3 2262w" sizes="(min-width: 1466px) 754px, (max-width: 599px) 100vw, (min-width: 600px) 600px, 237px">
<figcaption>
<span class="caption">‘Construct new Japan as Below’. Legend reads: Industrial Centre, Immigration Spheres, Expansion Spheres for White Races, Trade Expansion Spheres, Investment Expansion Spheres.</span>
<span class="attribution"><span class="source">From the Collection of the National Archives of Australia, A601, 402/17/30.</span></span>
</figcaption>
</figure>
<p>Japan’s visions for territorial expansions became clear in July 1937. Japan – <a href="https://www.awm.gov.au/articles/journal/j36/oliver">as Australia had long feared</a> – proved itself an aggressor when its army invaded China, signalling the start of the Second Sino-Japanese War.</p>
<p>Australia opted for a diplomatic response to this conflict, remaining impartial and encouraging “<a href="http://electionspeeches.moadoph.gov.au/speeches/1937-joseph-lyons">cooperation and conciliation</a>” as the solution. </p>
<p>However, Japanese economic investments were being viewed with increasing caution.</p>
<p>Australia’s trade commissioner in Tokyo, Eric E. Longfield Lloyd, reported that Japan’s territorial expansion into China had been aided by a seemingly innocent system of economic penetration throughout the 1920s and ’30s. He feared that allowing the Yampi Sound project to continue, operated as it was by Japanese staff, would result in a “foreign foothold” in Australian territory. </p>
<figure class="align-center ">
<img alt="" src="https://images.theconversation.com/files/225423/original/file-20180629-117377-1iiilnu.JPG?ixlib=rb-1.1.0&q=45&auto=format&w=754&fit=clip" srcset="https://images.theconversation.com/files/225423/original/file-20180629-117377-1iiilnu.JPG?ixlib=rb-1.1.0&q=45&auto=format&w=600&h=500&fit=crop&dpr=1 600w, https://images.theconversation.com/files/225423/original/file-20180629-117377-1iiilnu.JPG?ixlib=rb-1.1.0&q=30&auto=format&w=600&h=500&fit=crop&dpr=2 1200w, https://images.theconversation.com/files/225423/original/file-20180629-117377-1iiilnu.JPG?ixlib=rb-1.1.0&q=15&auto=format&w=600&h=500&fit=crop&dpr=3 1800w, https://images.theconversation.com/files/225423/original/file-20180629-117377-1iiilnu.JPG?ixlib=rb-1.1.0&q=45&auto=format&w=754&h=629&fit=crop&dpr=1 754w, https://images.theconversation.com/files/225423/original/file-20180629-117377-1iiilnu.JPG?ixlib=rb-1.1.0&q=30&auto=format&w=754&h=629&fit=crop&dpr=2 1508w, https://images.theconversation.com/files/225423/original/file-20180629-117377-1iiilnu.JPG?ixlib=rb-1.1.0&q=15&auto=format&w=754&h=629&fit=crop&dpr=3 2262w" sizes="(min-width: 1466px) 754px, (max-width: 599px) 100vw, (min-width: 600px) 600px, 237px">
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<span class="caption"></span>
<span class="attribution"><span class="source">From the collections of the National Archives of Australia, A601, 402/17/30.</span></span>
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<p>Longfield Lloyd pressed for the project’s cancellation “by any means whatsoever”. One proposal was was an export embargo “by declaration of insufficiency”. </p>
<p>Here was the origin of the 1938 iron ore embargo. </p>
<h2>Chequebook diplomacy</h2>
<p>Much like in 1938, today’s fears about Chinese investments hinge on the question of political influence and security implications. </p>
<p>These concern have led to the <a href="https://www.smh.com.au/business/new-investment-rules-to-curb-chinas-foreign-acquisition-binge-20170820-gy033p.html">limiting of property investments</a> and the <a href="https://www.reuters.com/article/us-australia-politics-foreign/australia-citing-concerns-over-china-cracks-down-on-foreign-political-influence-idUSKBN1DZ0CN">banning of foreign political donations</a>. </p>
<p>Further afield, China’s vast infrastructure program, the <a href="https://www.smh.com.au/world/asia/china-s-trillion-dollar-project-changing-the-world-20180618-p4zm4k.html">Belt and Road Initiative</a>, has sparked speculation that the nation is using chequebook diplomacy – and perhaps <a href="https://theconversation.com/why-chinas-debt-book-diplomacy-in-the-pacific-shouldnt-ring-alarm-bells-just-yet-96709">debt-book diplomacy</a> – to secure economic leverage and gain greater influence in regional and global affairs. </p>
<p>This is of particular concern in Australia’s immediate sphere of influence, Southeast Asia and the South Pacific. </p>
<p>Most recently, the Australian government sought to protect its diplomatic and security interests when it <a href="http://www.abc.net.au/news/2018-06-13/solomon-islands-undersea-cable-internet-china/9861592">outbid the Chinese telecom giant Huawei</a> for the rights to construct a network of internet cables linking the Solomon Islands to Sydney. </p>
<h2>Time for a long-range view of Australia and its foreign policy</h2>
<p>The economic pressure exerted on Japan in the 1930s and early 1940s – in which Australia was by no means alone, with the US and Britain leading the charge – deprived the nation of its means of survival. This hastened the campaign of aggressive regional conquest in pursuit of raw materials that eventually led to Pacific War.</p>
<p>To be sure, China’s current economic position makes it unlikely that trade sanctions will lead to armed conflict. But throw in <a href="https://theconversation.com/troubled-waters-conflict-in-the-south-china-sea-explained-59203">territorial disputes</a>, erratic leadership, the US-China struggle for Pacific dominance, and the future seems a lot less certain. </p>
<p>With all this in mind, the 1938 iron ore embargo does serve as a warning against over-reliance and a blinkered outlook that sees only potential dangers in our immediate region. </p>
<p>Now is the time for Australian to broaden its foreign relations, avoiding the potential downfall of over-reliance on the Chinese market and the US alliance, while building new diplomatic ties. </p>
<p>There is such an opportunity in Australia’s neighbourhood, “that part of the world”, as shadow defence minister Richard Marles <a href="https://www.lowyinstitute.org/publications/richard-marles-australia-pacific">recently argued</a>, “in which our influence matters the greatest. What we say and do in the Pacific carries enormous weight.” </p>
<p>Australia must take the initiative in its immediate region to develop varied and mutually beneficial economic, diplomatic and strategic relationships. </p>
<p>In this way, Australia can strengthen its own economy, the economies nearby and its role as a regional leader and collaborator.</p><img src="https://counter.theconversation.com/content/98387/count.gif" alt="The Conversation" width="1" height="1" />
<p class="fine-print"><em><span>Honae Cuffe receives funding from the Australian Government Research Training Program.</span></em></p>Eighty years ago, we were just as scared of the Japanese buying our assets as we are of the Chinese today. So what does this say about the future of Australia in the Asia-Pacific region?Honae Cuffe, PhD Candidate, History, University of NewcastleLicensed as Creative Commons – attribution, no derivatives.tag:theconversation.com,2011:article/835332017-09-06T00:15:51Z2017-09-06T00:15:51ZApple and 7-Eleven show why Trump’s threat to sever China trade over Korea rings hollow<p><a href="https://twitter.com/realDonaldTrump/status/904377075049656322">President Donald Trump tweeted</a> on September 3 that the U.S. “is considering, in addition to other options, stopping all trade with any country doing business with North Korea” after it <a href="https://www.vox.com/2017/9/3/16249504/trump-north-korea-trade-tweet">performed a nuclear test</a>. </p>
<p>Though North Korea <a href="http://atlas.media.mit.edu/en/profile/country/prk/">currently trades</a> with nearly 100 countries, this threat was almost certainly <a href="https://theconversation.com/how-china-could-use-trade-to-force-north-korea-to-play-nice-with-the-west-80609">aimed at China</a>, by far its <a href="http://atlas.media.mit.edu/en/profile/country/prk/">biggest trading partner</a>.</p>
<p>And it is technically something that a U.S. president can do. Under the <a href="https://www.treasury.gov/resource-center/sanctions/Documents/ieepa.pdf">International Emergency Economic Powers Act of 1977</a>, the president can impose trade restrictions in the face of an “unusual and extraordinary threat.”</p>
<p>Nevertheless, it is an empty threat. In the same way that North Korean leader Kim Jung Un is unlikely to commit political (and national) suicide by following through on a war with the U.S., Trump is unlikely to commit political suicide by following through on this hyperbolic threat.</p>
<p>This is because the damage to the U.S. economy, the global economy and international relations due to a cessation of <a href="https://theconversation.com/why-the-us-shouldnt-start-a-trade-war-with-china-82106">U.S.-Chinese trade</a> would be catastrophic, so much so that it is nearly impossible to predict exactly how it would play out. </p>
<p>Some have tried to do this anyway, such as by <a href="https://www.nytimes.com/2017/09/04/business/trump-china-north-korea-trade.html">citing the value of American trade with China</a>, which was <a href="https://ustr.gov/countries-regions/china-mongolia-taiwan/peoples-republic-china">about US$650 billion</a> in 2016, or around 4 percent of U.S. GDP. Some simple thought experiments illustrate why this barely scratches the surface of the impact. </p>
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<h2>Apple’s complex global supply chain</h2>
<p>The scale of the damage would primarily be due to the fact that global supply chains have become <a href="https://www.ft.com/content/2cf5bebe-9773-11e5-9228-87e603d47bdc">so complex</a>. </p>
<p>A common example is Apple’s iPhone, whose components are sourced from dozens of countries, with China playing <a href="https://www.nytimes.com/2016/12/29/technology/iphone-china-apple-stores.html?mcubz=0">a major role</a>. And that’s not just due to China’s relatively low labor costs. In many cases a supplier has been chosen because it has particular expertise. </p>
<p>Or, in some cases, a supplier has grown so large and efficient that it dominates the market for a key element of production, such as the vast iPhone <a href="https://www.nytimes.com/2016/12/29/technology/apple-iphone-china-foxconn.html">assembly operation</a> run by Foxconn in Shenzhen, China. Much of this work would be very costly, or impossible in the short run, to source elsewhere. </p>
<p>In other words, if you were eagerly anticipating the <a href="https://www.bloomberg.com/news/videos/2017-09-05/bofaml-s-qiao-china-s-macro-environment-is-stable-video">10th anniversary of Apple’s flagship device</a>, you’d probably have to wait a lot longer than expected. And it would cost Apple a lot more to make without Chinese components and labor, which would probably be passed on to consumers. </p>
<p>Focusing only on the value of trade between the U.S. and China misses a big part of the immediate impact if Trump were to carry out his threat. Suddenly, U.S. production of everything from toasters to T-shirts that depend on Chinese workers for any part of the production process would also shut down. </p>
<p>Affected American companies would then spend the next several months either trying to find new sources for those “inputs” – such as labor, energy or raw materials – or find a way to circumvent the policy, such as relocating their headquarters to another country. This could lead to a long-run loss of jobs and corporate tax revenues for the U.S. economy.</p>
<p>More generally, it is not clear that U.S.-based multinational companies could continue to do any business in China, the <a href="https://www.emarketer.com/Article/China-Eclipses-US-Become-Worlds-Largest-Retail-Market/1014364">world’s largest consumer market</a>. </p>
<p>For instance, consider the Dallas-based convenience store chain 7-Eleven, which operates in 16 countries, including China. Convenience stores are currently a booming industry in China, and <a href="https://www.cnbc.com/2016/11/30/chinas-convenience-store-segment-booms-7-eleven-familymart-ones-to-watch-bain.html">7-Eleven is well-positioned</a> to succeed in the market. This success will almost certainly generate jobs in the Dallas headquarters. </p>
<p>But 7-Eleven is also dependent on trade in services between Dallas and its Chinese outlets since, as a franchise, it licenses its brand to Chinese operators, and the revenue from these licenses is recorded as a U.S. export of services. Many U.S. companies <a href="https://www.usitc.gov/publications/332/China_ServicesEBOT_ExternalFinal.pdf">face similar situations</a>. As a result, a cessation of U.S.-China trade would severely hamper American companies whose growth prospects are currently focused on the Chinese market. </p>
<p>In fact, the Department of Commerce estimates that trade with China supports <a href="http://trade.gov/mas/ian/build/groups/public/@tg_ian/documents/webcontent/tg_ian_005508.pdf">nearly a million U.S. jobs</a>, and <a href="https://www.chinabusinessreview.com/study-understanding-the-us-china-trade-relationship/">others suggest</a> that the number is much higher. </p>
<h2>Farther down the chain</h2>
<p>The repercussions don’t end there, of course. </p>
<p>Companies in <a href="http://atlas.media.mit.edu/en/visualize/tree_map/hs92/export/usa/fra/show/2015/">France</a>, Germany and elsewhere rely on American suppliers for key components to make their products – <a href="https://ustr.gov/map/countriesaz/fr">from computer chips to jet engines</a>. And many of these U.S. companies invariably rely on Chinese businesses, in turn, to supply components they need to build those chips and engines. These U.S. companies would clearly be hard-pressed to stay in business without their Chinese partners. </p>
<p>This connection highlights the impact of U.S.-China trade on other nations: If it ended, these German and French companies would need to find new suppliers of chips and engines to make their computers and airplanes – and in some cases few alternatives exist. In addition, all of their other suppliers would suffer if they’re unable to find new sources of chips and engines. And so on down the supply chain. </p>
<p>In short, the U.S.-China trade relationship doesn’t stand alone. It is responsible for <a href="https://www.chinabusinessreview.com/study-understanding-the-us-china-trade-relationship/">a large number of links</a> in the global supply chain. If those links are broken, much of the global supply chain ceases to exist, and much of the global economy, essentially, breaks down.</p>
<figure class="align-center ">
<img alt="" src="https://images.theconversation.com/files/184811/original/file-20170905-13709-vdxbuj.jpg?ixlib=rb-1.1.0&q=45&auto=format&w=754&fit=clip" srcset="https://images.theconversation.com/files/184811/original/file-20170905-13709-vdxbuj.jpg?ixlib=rb-1.1.0&q=45&auto=format&w=600&h=400&fit=crop&dpr=1 600w, https://images.theconversation.com/files/184811/original/file-20170905-13709-vdxbuj.jpg?ixlib=rb-1.1.0&q=30&auto=format&w=600&h=400&fit=crop&dpr=2 1200w, https://images.theconversation.com/files/184811/original/file-20170905-13709-vdxbuj.jpg?ixlib=rb-1.1.0&q=15&auto=format&w=600&h=400&fit=crop&dpr=3 1800w, https://images.theconversation.com/files/184811/original/file-20170905-13709-vdxbuj.jpg?ixlib=rb-1.1.0&q=45&auto=format&w=754&h=503&fit=crop&dpr=1 754w, https://images.theconversation.com/files/184811/original/file-20170905-13709-vdxbuj.jpg?ixlib=rb-1.1.0&q=30&auto=format&w=754&h=503&fit=crop&dpr=2 1508w, https://images.theconversation.com/files/184811/original/file-20170905-13709-vdxbuj.jpg?ixlib=rb-1.1.0&q=15&auto=format&w=754&h=503&fit=crop&dpr=3 2262w" sizes="(min-width: 1466px) 754px, (max-width: 599px) 100vw, (min-width: 600px) 600px, 237px">
<figcaption>
<span class="caption">Jefferson tried a trade embargo. It didn’t work.</span>
<span class="attribution"><span class="source">Colin Dewar/Shutterstock.com</span></span>
</figcaption>
</figure>
<h2>Jefferson’s embargo of 1807</h2>
<p>Because today’s global economy is so complex and integrated – with the U.S. at the center of it all – it’s difficult to find a suitable historical comparison. However, in terms of the scale and motivation for the policy, the closest event may be the <a href="https://books.google.com/books?id=xaJeCwAAQBAJ&pg=PA72&lpg=PA72&dq=jefferson+trade+cessation+1807+embargo&source=bl&ots=kd-r_f9lB7&sig=ZdzTY2gBaqA4mQMruDnqODVTgh8&hl=en&sa=X&ved=0ahUKEwjG4ayW3I7WAhXh6oMKHXgXDNAQ6AEIWjAJ#v=onepage&q=jefferson%20trade%20cessation%201807%20embargo&f=false">self-imposed U.S. embargo</a> enacted by the Jefferson administration from 1807 to 1809.</p>
<p>In that case, the U.S. effectively ceased trading with the world, with the goal of inflicting economic costs on Britain, which had been harassing ships off the U.S. eastern coast. The policy, however, failed to achieve its goal of changing British behavior, while the cost to the U.S. was <a href="http://www.dartmouth.edu/%7Edirwin/docs/Embargo.pdf">significant, at about 5 percent of GNP</a>.</p>
<p>Today, the cost of cutting off trade to China would be much greater. In 1807, trade was primarily in finished goods, and supply chains were primitive. Now, <a href="https://www.ifw-kiel.de/ifw_members/publications/growing-trade-in-intermediate-goods-outsourcing-global-sourcing-or-increasing-importance-of-mne-networks/kap1006.pdf">two-thirds of international trade</a> is in “intermediate goods,” or products that make up other products (like computer chips and jet engines). Cutting one link in a supply chain can bring down the entire production process. </p>
<p>Finally, and somewhat ironically, cutting off trade would give China one less reason to listen to the U.S. on a range of topics – <a href="https://theconversation.com/china-is-the-key-to-avoiding-nuclear-fire-and-fury-in-north-korea-82257">including reining in North Korea</a>.</p><img src="https://counter.theconversation.com/content/83533/count.gif" alt="The Conversation" width="1" height="1" />
<p class="fine-print"><em><span>Greg Wright does not work for, consult, own shares in or receive funding from any company or organization that would benefit from this article, and has disclosed no relevant affiliations beyond their academic appointment.</span></em></p>The president said he’s considering ending trade with any country that does business with North Korea. Here’s why that will never happen.Greg Wright, Assistant Professor of Economics, University of California, MercedLicensed as Creative Commons – attribution, no derivatives.tag:theconversation.com,2011:article/797342017-07-05T06:16:39Z2017-07-05T06:16:39ZCan Donald Trump change Cuba?<p>Donald Trump has <a href="http://www.aljazeera.com/news/2017/06/trump-unveils-cuba-trade-travel-restrictions-170616165127045.html">ended America’s détente with Cuba</a>, restoring restrictions on travel to and business with the Caribbean island nation.</p>
<p>In December 2014, Cuban president Raúl Castro and then US president Barack Obama announced in simultaneous speeches that after a 50-year stand off, diplomatic relations between the two nations would be “normalised”, reopening embassies in Havana and Washington and enabling American citizens to visit Cuba relatively freely. </p>
<p>Under Trump’s new rules, which are really a return to the <a href="https://www.whitehouse.gov/the-press-office/2017/06/16/fact-sheet-cuba-policy">old American policy of isolation</a>, Trump has reaffirmed “the United States statutory embargo of Cuba”. The embassies will remain (for now) but the flow of US tourists and dollars is severely restrained for the foreseeable future. </p>
<p>In his June 16 speech in Miami, Trump also took aim at Cuba’s military (the Revolutionary Armed Forces, or FAR in Spanish) and said that he would “expose the crimes of the Castro regime.”</p>
<p>In Trump’s old-school approach, any improvement of US-Cuba relations will now depend on political change in Havana, with Washington monitoring “Cuba’s progress — if any — toward greater political and economic freedom”.</p>
<p>Cuba’s response was swift and defiant. “The Cuban government denounces the new measures hardening the blockade that are destined to fail … and that will not achieve their aim of weakening the revolution”, <a href="http://uk.reuters.com/article/uk-usa-cuba-havana-idUKKBN19800V?il=0">read a statement</a> from Havana announced on the evening news.</p>
<p>Indeed, rather than spur political transition, Trump’s revamped old policy will more likely have a paradoxical effect on Cuba, seriously damaging the economy while actually galvanising the political system. </p>
<h2>An indirect military battle</h2>
<p>Cuba may <a href="https://theconversation.com/in-cuba-the-post-fidel-era-began-ten-years-ago-71720?sr=1">not be the same regime</a> that the US embargo was designed to debilitate, but it is still governed by the same civil-military coalition. </p>
<p>The Communist Party embodies Cuba’s commitment to anti-capitalist ideals, building consent among civil society. The FAR, which comprises ground, naval and aerial military forces as well as the Youth Labour Army, is the institutionalised expression of Cuban nationalism. </p>
<p>Its goal is to ensure readiness against any external threat. Historically, that’s been the US. </p>
<p>This is the force that the US president is taking on with his new economic policy. Since the fall of the Soviet Union in 1990, which left Cuba alone in a “capitalist sea”, <a href="https://books.google.com.mx/books/about/Cuba_s_Military_1990_2005.html?id=1fHFAAAAQBAJ&printsec=frontcover&source=kp_read_button&redir_esc=y#v=onepage&q&f=false">the FAR has been deeply involved in economic management</a>. </p>
<p>Castro’s current “economy czar”, Marino Murillo, is a FAR-trained economist, and the FAR is also home to the Business Management Group, or GAESA, which <a href="http://www.reuters.com/article/us-usa-cuba-military-idUSKBN1962VK">receives around 50% of hard-currency</a> Cuban earnings. GAESA is present in virtually all sectors of the Cuban economy, including tourism, which will be among the areas hardest hit by Trump’s revamped policy. </p>
<p>Trump actually kept in place one key aspect of Obama’s approach: earning the trust of Cuban small businesses. But he added a twist. Where Obama sought “to empower the nascent Cuban private sector”, Trump will channel “economic activities away from the Cuban military” while continuing to allow American individuals and entities to develop economic ties in Cuba.</p>
<p>In reducing tourism, the new US policy explicitly seeks to block the flow of US dollars to the military-led GAESA. In the years just prior to Obama’s 2015 detente, <a href="http://fingfx.thomsonreuters.com/gfx/rngs/USA-CUBA/010041M93J3/index.html">the number of Americans travelling to Cuba</a> oscillated between 60,000 to 100,000. In 2015, it grew to 160,000. The next year, some 290,000 US tourists visited the island.</p>
<p>Americans still account for just 7% of the island’s international tourists (second to Canada, <a href="http://fingfx.thomsonreuters.com/gfx/rngs/USA-CUBA/010041M93J3/index.html">which sent 1.2 million visitors</a>). But any contraction in that sector will have a negative economic effect on Cuba, which earned US$2.9 billion from tourism in 2016, <a href="http://fingfx.thomsonreuters.com/gfx/rngs/USA-CUBA/010041M93J3/index.html">up from</a> US$2.4 billion in 2014. </p>
<p>Trump’s new policy will mean less hard currency in the hands of the Cuban state. This reduces its ability to buy commodities from the international market, ranging from energy to – critically – food. <a href="http://af.reuters.com/article/commoditiesNews/idAFL1N1JN0VN?cn=bWVudGlvbg%3D%3D">Cuba currently imports more than 60% of its domestic food requirements</a>. </p>
<p>This difficult economic situation is compounded by the ongoing crisis in Venezuela, a regional ally that is <a href="https://panampost.com/david-unsworth/2017/05/05/russia-cuba-oil-lifeline-gap-venezuela-collapses/">no longer a reliable source of cheap oil</a>. </p>
<h2>The US monster reawakens</h2>
<p>For more than 50 years, the US embargo served as a potent tool for the Communist Party, enabling it to survive through scarcity and turmoil by presenting itself as a bulwark <a href="http://isreview.org/issue/63/cuba-and-anti-imperialism">against an imperial US</a> set on subjugating the Cuban people to its will.</p>
<p>Among Cubans, the US is sometimes referred to simply as <em>el monstruo</em> – “the monster” – a nickname <a href="https://www.jstor.org/stable/20671733">first used by</a> revolutionary Jose Marti in 1895.</p>
<p>By attacking GAESA based on the (demonstrably errant) idea – shared by both Obama and Trump – that capitalism brings democracy, Trump is more likely to feed the anti-imperialist sentiment of the Cuban military, strengthening its relevance. </p>
<p>Much as Fidel Castro did throughout the 20th century, the FAR is now well positioned to capitalise on being under US attack, portraying the Cuban military at the front line of the anti-Trump movement. Already, the return of the hawkish attitude in Washington <a href="http://www.14ymedio.com/nacional/Consensos-disensos-politica-Trump-Cuba_0_2238976086.html#.WUjlrRdIlPs.facebook">has revived the old televised calls</a> on the island for Cubans to unite against the eternal threat lying just across the Florida Strait. </p>
<p>Havana also pointed out the hypocrisy in Trump’s claim that human rights are at the core of his Cuba policy. </p>
<p>“We have serious worries about the respect and guarantee of human rights in that country,” <a href="http://uk.reuters.com/article/uk-usa-cuba-havana-idUKKBN19800V?il=0">Havana replied</a>, referring to well-publicised American injustices such as police violence, gun crime, racial discrimination, lack of health care, gender inequality and accounts of torture at the Guantánamo Bay prison, which sits on occupied Cuban land.</p>
<p>There also remains the glaring contradiction in Washington demanding political change from Cuba while turning a blind eye <a href="http://www.mintpressnews.com/why-the-us-turns-a-blind-eye-to-saudi-arabias-troublemaking/208845/">to authoritarianism in Saudi Arabia</a> and <a href="http://www.independent.co.uk/voices/commentators/fisk/robert-fisk-why-does-the-us-turn-a-blind-eye-to-israeli-bulldozers-1883670.html">Israel’s occupation of Palestinian land</a>, for example.</p>
<p>Cuba is no democracy. Inspired by China and Vietnam, Raúl Castro has tried to reform the economy while maintaining a one-party system, and the regime continues to <a href="https://www.amnesty.org/en/latest/campaigns/2016/03/six-facts-about-censorship-in-cuba/">censor the media</a> and repress <a href="https://www.hrw.org/americas/cuba">political dissidence</a>.</p>
<p>In re-embargoing Cuba, Trump is certainly adding an obstacle to Raúl Castro’s economic plans, but doing so won’t change Cuba for the better. Instead, transgressing the country’s hard-won sovereignty will only strengthen the political forces there that oppose democracy.</p><img src="https://counter.theconversation.com/content/79734/count.gif" alt="The Conversation" width="1" height="1" />
<p class="fine-print"><em><span>Ramón I. Centeno does not work for, consult, own shares in or receive funding from any company or organisation that would benefit from this article, and has disclosed no relevant affiliations beyond their academic appointment.</span></em></p>Trump’s revamped old policy could have a paradoxical effect on Cuba, seriously damaging the country’s economy while actually galvanising its political system.Ramón I. Centeno, Postdoctoral fellow, Universidad Nacional Autónoma de México (UNAM)Licensed as Creative Commons – attribution, no derivatives.tag:theconversation.com,2011:article/795592017-06-16T20:54:04Z2017-06-16T20:54:04ZTrump nods to Cuban exiles, rolls back ties: Experts react<figure><img src="https://images.theconversation.com/files/174241/original/file-20170616-493-1ntcnsl.jpg?ixlib=rb-1.1.0&q=45&auto=format&w=496&fit=clip" /><figcaption><span class="caption">Will Trump's policy put a freeze on the U.S.-Cuba thaw?</span> <span class="attribution"><span class="source">AP Photo/Ramon Espinosa</span></span></figcaption></figure><p><em>Editor’s note: President Donald Trump announced on Friday a <a href="https://www.bloomberg.com/politics/articles/2017-06-16/trump-rolls-back-obama-led-cuba-opening-with-new-limits-on-deals">partial reversal of former President Barack Obama’s</a> policy of engagement with Cuba. Trump restored travel restrictions and prohibited financial transactions with the Cuban military. Under the new policy, Americans visiting Cuba for specific, approved purposes will be forbidden from spending money in hotels or restaurants with ties to the military. Airlines and cruise ships, however, may continue to expand travel to the island, while the <a href="https://www.wsj.com/articles/open-cubas-market-to-u-s-farmers-1497396058">U.S. embargo</a> will remain in place. We asked two experts on U.S.-Cuba relations to explain what these changes mean.</em></p>
<h2>Politics over policy</h2>
<p><strong>William M. LeoGrande, American University</strong></p>
<p>Cuba “is a domestic issue for the United States and not a foreign policy issue,” Brent Scowcroft, President George H. W. Bush’s national security adviser, <a href="http://www.cubanet.org/htdocs/CNews/y98/nov98/24e3.htm">observed</a> in 1998. “It focuses more on votes in Florida.” From the end of the Cold War in 1991 until 2014, when Obama <a href="https://obamawhitehouse.archives.gov/the-press-office/2014/12/17/statement-president-cuba-policy-changes">decided</a> normalizing relations would better serve U.S. interests abroad, U.S. presidential candidates feared that any opening to Cuba would cost them Cuban-American votes in the battleground state of Florida.</p>
<p>Now, Trump has turned back the clock and announced a new Cuba policy at the Manual Artime Theater in Miami’s Little Havana – named after the leader of the Cuban exile brigade that stormed ashore <a href="https://history.state.gov/milestones/1961-1968/bay-of-pigs">at the Bay of Pigs</a>. According to senior administration officials, Trump decided to tighten the U.S. embargo because he owed a political debt to the brigade’s veterans’ association, which <a href="http://miamiherald.typepad.com/nakedpolitics/2016/10/cuban-exile-brigade-makes-first-ever-presidential-endorsement-for-trump.html">endorsed</a> him for president at a time when the race in Florida looked close. In return, he promised to reverse Obama’s policy. Promise made, promise kept.</p>
<figure class="align-center ">
<img alt="" src="https://images.theconversation.com/files/174242/original/file-20170616-1205-v60rl9.jpg?ixlib=rb-1.1.0&q=45&auto=format&w=754&fit=clip" srcset="https://images.theconversation.com/files/174242/original/file-20170616-1205-v60rl9.jpg?ixlib=rb-1.1.0&q=45&auto=format&w=600&h=435&fit=crop&dpr=1 600w, https://images.theconversation.com/files/174242/original/file-20170616-1205-v60rl9.jpg?ixlib=rb-1.1.0&q=30&auto=format&w=600&h=435&fit=crop&dpr=2 1200w, https://images.theconversation.com/files/174242/original/file-20170616-1205-v60rl9.jpg?ixlib=rb-1.1.0&q=15&auto=format&w=600&h=435&fit=crop&dpr=3 1800w, https://images.theconversation.com/files/174242/original/file-20170616-1205-v60rl9.jpg?ixlib=rb-1.1.0&q=45&auto=format&w=754&h=547&fit=crop&dpr=1 754w, https://images.theconversation.com/files/174242/original/file-20170616-1205-v60rl9.jpg?ixlib=rb-1.1.0&q=30&auto=format&w=754&h=547&fit=crop&dpr=2 1508w, https://images.theconversation.com/files/174242/original/file-20170616-1205-v60rl9.jpg?ixlib=rb-1.1.0&q=15&auto=format&w=754&h=547&fit=crop&dpr=3 2262w" sizes="(min-width: 1466px) 754px, (max-width: 599px) 100vw, (min-width: 600px) 600px, 237px">
<figcaption>
<span class="caption">Trump shows the signed executive order surrounded by Cabinet members and supporters in Miami on Friday.</span>
<span class="attribution"><span class="source">AP Photo/Lynne Sladky</span></span>
</figcaption>
</figure>
<p>In May, an interagency policy review of Obama’s Cuba policy found that it was working. Trump’s White House <a href="http://www.miamiherald.com/news/politics-government/article156337719.html">rejected</a> the result and wrote its own hard-line policy with the help of Cuban-American legislators Rep. Mario Díaz-Balart and Sen. Marco Rubio. “They worked with us hand in glove,” <a href="https://www.whitehouse.gov/the-press-office/2017/06/15/background-briefing-presidents-cuba-policy">explained</a> a senior administration official. </p>
<p>But they didn’t get everything they wanted. Díaz-Balart’s <a href="http://latinamericagoesglobal.org/2017/03/congressman-mario-diaz-balarts-memo-white-house-re-cuba-policy-changes/">original recommendation</a> was to roll back everything Obama had done to foster trade and travel. Faced with a flood of <a href="https://www.usatoday.com/story/news/world/2016/11/20/cuba-donald-trump-barack-obama-diplomatic-opening/93956270/">appeals</a> from U.S. businesses not to cut them out of the Cuban market, Trump relented, prohibiting only people-to-people travel by individuals and financial transactions with enterprises managed by the Cuban military. As the administration official <a href="https://www.whitehouse.gov/the-press-office/2017/06/15/background-briefing-presidents-cuba-policy">explained</a>, “You can’t put the genie back in the bottle 100 percent.”</p>
<p>As foreign policy, Trump’s new tough stance makes little sense, in my opinion. Many Latin American countries expressed <a href="https://www.nytimes.com/2015/04/12/world/americas/obama-cuba-summit-of-the-americas.html?_r=0">support for Obama’s policy</a> of engagement. By reversing it, Trump imperils their cooperation on issues like migration and narcotics trafficking. Disengaging also leaves the door open for China and Russia to continue expanding their influence on the island. </p>
<p>Finally, the United States needs Cuba’s cooperation on issues of mutual interest such as environmental protection, counter-narcotics cooperation, and migration – cooperation that will be harder to sustain now that Trump has restarted the Cold War in the Caribbean.</p>
<h2>Bad for business?</h2>
<p><strong>Brian Gendreau, University of Florida</strong></p>
<p>Essentially, the Trump administration’s goal is to loosen the grip of the Cuban government and military on the economy and, in doing so, encourage growth in the <a href="https://www.engagecuba.org/cubas-private-sector/">private sector</a> and lead to political change. </p>
<p>It is far from clear, however, that the new policy will achieve these aims. Rather, its immediate effect will be to hurt Cuba’s <a href="https://www.wsj.com/articles/cubas-budding-private-sector-looks-nervously-to-future-1484044230">nascent private sector</a>, especially in the tourism industry, in which the business arm of the Cuban military (known as GAESA) is <a href="https://www.reuters.com/article/us-usa-cuba-military-idUSKBN1962VK">heavily involved</a>. U.S. businesses won’t be happy either. </p>
<p>Thanks to the thaw, tourism had been a bright spot in Cuba’s economy, which <a href="http://www.babalublog.com/2016/12/29/reports-from-cuba-cuban-economy-in-2016-gdp-contracted-0-9/">suffered its first decline</a> in 23 years in 2016 because of a drop in export income. In contrast, tourism has been booming as a <a href="http://cubajournal.co/cuba-attracts-record-visitors-in-2016/">record 4 million tourists</a> visited Cuba last year, an increase of 13 percent, with a growing share from the United States. </p>
<p>Trump’s tighter travel restrictions will likely reverse that trend and discourage Americans from visiting the island, adversely affecting private Cuban businesses – and the jobs and incomes that depend on them – as well as American companies that were hoping to benefit from the opening of relations initiated under Obama. </p>
<p>And the prohibition on direct dealings with the military will make it harder for hotels expanding to Cuba to operate. In mid-2016, <a href="https://www.usatoday.com/story/travel/roadwarriorvoices/2016/06/30/first-hotel-us-company-opens-havana/86581276/">Starwood</a> became the first U.S. hotel company to operate a location in Cuba in almost 60 years, and many other chains <a href="http://www.caribbeannewsdigital.com/en/noticia/major-us-hotel-chains-could-land-cuba-anytime-soon">have been expressing interest</a> in expanding to the island.</p>
<p>These U.S. hotel chains may have to withdraw or scrap expansion plans unless the Cuban government pushes the military out of the industry – which is possible.</p>
<p>Even Cuban businesses with absolutely no ties to the military – such as private restaurants and small bed-and-breakfasts – will be hurt by the policy changes because of the likely drop in American visitors. </p>
<p>As it happens, the new policy seems out of step with a large part of the business community and most Americans. For example, the Trump administration will continue to face pressure from U.S. business and agricultural companies, many with close ties to the Republican Party, to expand commercial relations with Cuba. These include <a href="https://www.wsj.com/articles/open-cubas-market-to-u-s-farmers-1497396058">efforts to end the prohibition on the use of credit</a> in sales of farm products to Cuba (currently transactions must take place in cash). </p>
<p>And <a href="http://www.gallup.com/poll/1630/cuba.aspx">polls show</a> a growing share of Americans favor normal relations with Cuba. Nearly six in 10 <a href="https://www.nytimes.com/interactive/projects/cp/international/obama-in-cuba/most-americans-support-ending-cuba-embargo-nyt-poll-finds">support lifting the embargo</a>. </p>
<p>For the time being, however, a dwindling number of advocates of a hard line on Cuba have prevailed, and there are no new negotiations with Cuba on the horizon. Eventually, however, pressures from business and popular will may force the president to try to broker a broader deal with Cuba including, perhaps, an end to the embargo.</p><img src="https://counter.theconversation.com/content/79559/count.gif" alt="The Conversation" width="1" height="1" />
<p class="fine-print"><em><span>Brian Gendreau receives funding through the University of Florida under a National Resource Center grant from the U.S. Department of Education to produce an annual report on the Latin American business environment. </span></em></p><p class="fine-print"><em><span>William M. LeoGrande is a member of the Advisory Board of the Cuba Consortium, a project of the Howard Baker Forum.</span></em></p>The president restored restrictions on Americans’ travel to Cuba and prohibited transactions with its military. Here’s why, and what’s to come.Brian Gendreau, Director, Latin American Business Environment program, University of FloridaWilliam M. LeoGrande, Professor of Government, American University School of Public AffairsLicensed as Creative Commons – attribution, no derivatives.tag:theconversation.com,2011:article/596502016-05-25T01:01:22Z2016-05-25T01:01:22ZWhat does it mean for researchers, journalists and the public when secrecy surrounds science?<figure><img src="https://images.theconversation.com/files/123803/original/image-20160524-25213-q3h9yn.jpg?ixlib=rb-1.1.0&rect=8%2C369%2C2968%2C2090&q=45&auto=format&w=496&fit=clip" /><figcaption><span class="caption">People get suspicious when ethically fraught science is discussed behind closed doors.</span> <span class="attribution"><a class="source" href="http://www.shutterstock.com/pic.mhtml?id=133184528&src=id">DNA image via www.shutterstock.com.</a></span></figcaption></figure><p>Did you hear about the secret meeting earlier this month at Harvard Medical School? The one where scientists schemed to create a parentless human being from scratch? Maybe you read one of the skeptical <a href="http://www.nytimes.com/2016/05/14/science/synthetic-human-genome.html">news</a> <a href="http://www.mercurynews.com/science/ci_29890402/critics-attack-harvards-secret-meeting-human-genome-synthesis">articles</a>, or the stories illustrated with images from the dystopian sci-fi classic “<a href="http://gizmodo.com/experts-held-a-secret-meeting-to-consider-building-a-hu-1776538323">Blade Runner</a>” or of a <a href="https://www.washingtonpost.com/news/speaking-of-science/wp/2016/05/13/secret-harvard-meeting-on-synthetic-human-genomes-incites-ethics-debate/">robot Frankenstein</a>. One blogger compared the meeting to a gathering of “<a href="http://www.valuewalk.com/2016/05/secret-dna-meeting-held-at-harvard-screams-bond-villains/">Bond villains</a>.”</p>
<p>The press coverage was suspicious and critical. Why would a bunch of scientists need to exclude the media and the public from a meeting about something as ethically fraught as synthesizing a human genome?</p>
<p>Three weeks later, the exact details of what happened are still being contested. I’m a researcher in synthetic biology, and I learned of the project from reading the newspaper. I reached out to the meeting’s organizers, who – for reasons I’ll explain – declined to comment for this article. But in conversations with meeting invitees, as well as some critics, I’ve found that much of the press coverage was misleading, and says more about the relationship between journalists and scientists than the meeting itself.</p>
<p>What really happened behind closed doors when over 130 scientists, industry leaders and ethicists convened to talk about synthesizing a human genome? How did these sessions end up so widely misunderstood by the media and the public?</p>
<h2>Open doors versus science publishing protocols</h2>
<p>The May 10 meeting was <a href="http://www.nytimes.com/2016/05/14/science/synthetic-human-genome.html">titled</a> “HGP-Write: Testing Large Synthetic Genomes in Cells.” HGP refers to the <a href="https://www.genome.gov/11006943/human-genome-project-completion-frequently-asked-questions/">Human Genome Project</a>, the world’s largest collaborative biological effort that resulted in the sequencing of the full human genome in 2003.</p>
<p>Those invited say the organizers hoped to inspire scientists and the public with a new grand challenge project: to advance from <em>reading</em> genomes to <em>writing</em> them, by manufacturing them from individual DNA building blocks. In an invitation dated March 30, the hosts proposed a bold collaborative effort to “synthesize a complete human genome within a cell line.” Panels tackled whether such an effort is worthwhile, as well as the ethical, technological and economic challenges.</p>
<p>The conversation was not intended to be restricted. The meeting organizers – Harvard geneticist <a href="http://arep.med.harvard.edu/gmc/">George Church</a>; New York University systems geneticist <a href="http://www.med.nyu.edu/research/boeke-lab">Jef Boeke</a>; <a href="http://andrewhessel.com/">Andrew Hessel</a>, of the Bio/Nano research group at <a href="http://www.autodesk.com/">Autodesk, Inc.</a>; and <a href="http://nancyjkelley.com/nancy/">Nancy J. Kelley</a>, a lawyer specializing in biotechnology consulting – had plans to engage the broader scientific community, as well as industry, policy makers and the public. They made a video recording of the entire meeting, originally intended to be live-streamed over the Internet. They planned to apply for federal funding, which would invite regulatory oversight. And they submitted a white paper to a major peer-reviewed journal explaining the scientific, technological and ethical aspects of the project.</p>
<p>But the publication of the paper was delayed – editors commonly ask for revisions as part of the peer review process and Dr. Church told STAT News they wanted “more information about the <a href="https://www.statnews.com/2016/05/13/harvard-meeting-synthetic-genome/">ethical, social, and legal components</a> of synthesizing genomes” included. (As of this writing, the paper has not yet come out.) The organizers are prohibited from discussing the paper in public until it is published – a common <a href="http://www.sciencemag.org/authors/science-editorial-policies">journal</a> <a href="http://www.nature.com/nature/authors/policy/embargo.html">policy</a> known as an embargo. In deference to the embargo, they declined to comment in detail for this article.</p>
<p>News of the delay came just days before the meeting, and, with dozens of attendees en route, the hosts made a fateful decision. They chose to proceed, but to close the doors to most journalists and ask attendees to delay public discussion until the embargo lifts. (At least one journalist was there – Simone Ross, co-founder of <a href="http://techonomy.com">Techonomy Media</a>, confirmed her attendance to me.) “<a href="https://www.statnews.com/2016/05/13/harvard-meeting-synthetic-genome/">I’m not sure that was the best idea</a>,” Dr. Church told STAT News of the decision to proceed out of the public eye.</p>
<p>The secrecy bred suspicion. “Would it be OK to <a href="https://dspace.mit.edu/bitstream/handle/1721.1/102449/ShouldWeGenome.pdf?sequence=1">sequence and then synthesize Einstein’s genome?</a>” asked Stanford bioengineer Drew Endy and Northwestern bioethicist Laurie Zoloth in a joint essay. In theory, an artificial human genome could be used to generate a living human without biological parents. “This idea is an enormous step for the human species, and it shouldn’t be discussed <a href="https://www.statnews.com/2016/05/13/harvard-meeting-synthetic-genome/">only behind closed doors</a>,” STAT News quoted Dr. Zoloth.</p>
<p>Beyond qualms about the science itself, some observers were concerned that the organizers’ decisions - which included seeking industry partners and private funding - were quiet moves towards “<a href="http://www.geneticsandsociety.org/article.php?id=9374">privatiz[ing] the current conversation about heritable genetic modification</a>.”</p>
<figure class="align-center zoomable">
<a href="https://images.theconversation.com/files/123821/original/image-20160524-25202-1vcfg0q.jpg?ixlib=rb-1.1.0&q=45&auto=format&w=1000&fit=clip"><img alt="" src="https://images.theconversation.com/files/123821/original/image-20160524-25202-1vcfg0q.jpg?ixlib=rb-1.1.0&q=45&auto=format&w=754&fit=clip" srcset="https://images.theconversation.com/files/123821/original/image-20160524-25202-1vcfg0q.jpg?ixlib=rb-1.1.0&q=45&auto=format&w=600&h=400&fit=crop&dpr=1 600w, https://images.theconversation.com/files/123821/original/image-20160524-25202-1vcfg0q.jpg?ixlib=rb-1.1.0&q=30&auto=format&w=600&h=400&fit=crop&dpr=2 1200w, https://images.theconversation.com/files/123821/original/image-20160524-25202-1vcfg0q.jpg?ixlib=rb-1.1.0&q=15&auto=format&w=600&h=400&fit=crop&dpr=3 1800w, https://images.theconversation.com/files/123821/original/image-20160524-25202-1vcfg0q.jpg?ixlib=rb-1.1.0&q=45&auto=format&w=754&h=503&fit=crop&dpr=1 754w, https://images.theconversation.com/files/123821/original/image-20160524-25202-1vcfg0q.jpg?ixlib=rb-1.1.0&q=30&auto=format&w=754&h=503&fit=crop&dpr=2 1508w, https://images.theconversation.com/files/123821/original/image-20160524-25202-1vcfg0q.jpg?ixlib=rb-1.1.0&q=15&auto=format&w=754&h=503&fit=crop&dpr=3 2262w" sizes="(min-width: 1466px) 754px, (max-width: 599px) 100vw, (min-width: 600px) 600px, 237px"></a>
<figcaption>
<span class="caption">Like stringing together letters in a printing press, DNA synthesis involves building genes base-by-DNA base.</span>
<span class="attribution"><a class="source" href="http://www.shutterstock.com/pic.mhtml?id=297675230">Letters via www.shutterstock.com.</a></span>
</figcaption>
</figure>
<h2>The mundane truth about synthetic DNA</h2>
<p>But whether or not the meeting was truly secret is a distraction from its declared main purpose – to discuss the future of DNA synthesis.</p>
<p>The process of making artificial DNA is similar to letterpress printing – each character is painstakingly assembled in the correct order. The result is chemically identical to naturally-occurring DNA. The <a href="http://www.synthesis.cc/2016/05/synthesizing-secret-genomes.html">global market for synthetic DNA</a> is estimated at nearly US$1 billion annually, and does not typically draw much ethical scrutiny. Indeed, both Drs. Church and Endy are co-founders of a DNA synthesis company called <a href="https://www.gen9bio.com/about-us/our-founders">Gen9</a>. </p>
<p>Synthetic DNA is behind promising treatments for <a href="http://www.the-scientist.com/?articles.view/articleNo/42462/title/The-CAR-T-Cell-Race/">cancer</a>, <a href="http://www.health.harvard.edu/blog/pcsk9-inhibitors-a-major-advance-in-cholesterol-lowering-drug-therapy-201503157801">heart disease</a>, <a href="http://doi.org/10.1038/528S8a">HIV</a> and <a href="http://www.theverge.com/2016/4/20/11450262/crispr-base-editing-single-nucleotides-dna-gene-liu-harvard">Alzheimer’s disease</a>. In their invitation, meeting organizers expressed hope that the project would enable “the development of safer, less costly and more effective therapeutics.” Customized cells could be designed to produce biofuels, clean up pollution, or halt the spread of pandemics. Additionally, scientists know that small changes to one’s DNA can majorly influence health, but they have a limited set of tools to study these changes in detail.</p>
<p>The press has largely cheered recent advances in synthesizing DNA. In 2010, J. Craig Venter and his team <a href="http://www.nytimes.com/2010/05/21/science/21cell.html?_r=0">fabricated</a> all 1 million bases of a bacterial genome and transplanted it into a cell. In 2014, meeting organizer Dr. Boeke accomplished the same with <a href="http://doi.org/10.1038/nature.2014.14941">one of the 16 yeast chromosomes</a>; he currently leads a consortium <a href="http://syntheticyeast.org/">trying to synthesize the rest</a>. And the goal of synthesizing a human genome is not new - Mr. Hessel, another organizer, stated <a href="http://www.nytimes.com/2016/05/14/science/synthetic-human-genome.html">his interest in doing so</a> as early as 2012. </p>
<p>And while undoubtedly controversial, meeting conveners say the proposal to make a human genome was intended to inspire a unified vision for the future of synthetic biology, and a plan for addressing the current barriers.</p>
<p>For example, even the genome of a tiny microbe proved to be a steep and costly challenge for Dr. Venter and his team. Creating the synthetic bacterium <a href="http://www.nytimes.com/2010/05/21/science/21cell.html?_r=0">cost over $40 million</a> and required years of work. At current prices, a single human genome would <a href="http://www.nytimes.com/2016/05/14/science/synthetic-human-genome.html">cost $90 million to manufacture</a> – though Dr. Endy predicts that as costs continue to decline, the price tag could drop to $100,000 by 2036.</p>
<p>There is also the issue of manufacturing capacity. Currently, the <a href="http://www.synthesis.cc/2016/03/on-dna-and-transistors.html">entire yearly global production</a> of synthetic DNA would not be enough to print a single human genome.</p>
<p>A major focus of the meeting, say numerous attendees, was to begin to address these technical shortcomings.</p>
<h2>Ethical debate in advance</h2>
<p>Much of the suspicion around the meeting focused on the idea that researchers were hatching clandestine plans to clone human beings via synthetic DNA. And chemically manufacturing the human genome - the set of genetic instructions found in every cell - would truly give new meaning to the term “test-tube baby.” If such a technology existed, any individual’s genome could be decoded and then synthesized on demand by anyone with the know-how.</p>
<p>Ethicists and the news media blew the whistle on what looked to them like scientific hubris.</p>
<p>In their essay, Drs. Endy and Zoloth argue that synthesizing life is “<a href="https://dspace.mit.edu/bitstream/handle/1721.1/102449/ShouldWeGenome.pdf?sequence=1">an enormous moral gesture</a>” which should not be undertaken lightly. And they worry that linking the future of synthetic biology to such a controversial stated goal could jeopardize the entire endeavor. </p>
<p>It makes sense to wrestle with ethical questions well in advance of being confronted with immediate, real-world applications. But at the moment, I’d argue human cloning remains a distant dream.</p>
<p>Importantly, there’s currently no way to transplant an artificial genome into human cells, and even the most impressive achievements - like Dr. Boeke’s yeast project - are hundreds of times smaller in scale than the proposed challenge. It’s not even clear that making a synthetic human cell is worth it. Fabricating the genome of a fruit fly or nematode - <a href="http://www.biology-pages.info/G/GenomeSizes.html">30 times smaller</a> and less ethically fraught than that of a person - could answer many of the same questions. </p>
<p>Scientists could also study human genetics by analyzing people whose DNA already <a href="https://www.washingtonpost.com/national/health-science/genome-news-flash-were-all-a-little-bit-broken/2012/02/15/gIQAyacKIR_story.html?tid=pm_national_pop">contains the desired features</a>, or by using tools to <a href="http://theconversation.com/crispr-cas-gene-editing-technique-holds-great-promise-but-research-moratorium-makes-sense-pending-further-study-43371">edit existing DNA</a>.</p>
<figure class="align-center zoomable">
<a href="https://images.theconversation.com/files/123820/original/image-20160524-25239-1l82yt.jpg?ixlib=rb-1.1.0&q=45&auto=format&w=1000&fit=clip"><img alt="" src="https://images.theconversation.com/files/123820/original/image-20160524-25239-1l82yt.jpg?ixlib=rb-1.1.0&q=45&auto=format&w=754&fit=clip" srcset="https://images.theconversation.com/files/123820/original/image-20160524-25239-1l82yt.jpg?ixlib=rb-1.1.0&q=45&auto=format&w=600&h=400&fit=crop&dpr=1 600w, https://images.theconversation.com/files/123820/original/image-20160524-25239-1l82yt.jpg?ixlib=rb-1.1.0&q=30&auto=format&w=600&h=400&fit=crop&dpr=2 1200w, https://images.theconversation.com/files/123820/original/image-20160524-25239-1l82yt.jpg?ixlib=rb-1.1.0&q=15&auto=format&w=600&h=400&fit=crop&dpr=3 1800w, https://images.theconversation.com/files/123820/original/image-20160524-25239-1l82yt.jpg?ixlib=rb-1.1.0&q=45&auto=format&w=754&h=503&fit=crop&dpr=1 754w, https://images.theconversation.com/files/123820/original/image-20160524-25239-1l82yt.jpg?ixlib=rb-1.1.0&q=30&auto=format&w=754&h=503&fit=crop&dpr=2 1508w, https://images.theconversation.com/files/123820/original/image-20160524-25239-1l82yt.jpg?ixlib=rb-1.1.0&q=15&auto=format&w=754&h=503&fit=crop&dpr=3 2262w" sizes="(min-width: 1466px) 754px, (max-width: 599px) 100vw, (min-width: 600px) 600px, 237px"></a>
<figcaption>
<span class="caption">Content from scientific meetings is as likely fodder for social media as journal papers.</span>
<span class="attribution"><a class="source" href="http://www.shutterstock.com/pic-344818604/stock-photo-audience-at-a-business-conference-person-taking-photo-with-smart-phone.html">Meeting image via www.shutterstock.com.</a></span>
</figcaption>
</figure>
<h2>Science/journalism symbiosis</h2>
<p>Apart from the scientific questions, the episode highlights the complicated relationship between scientists and the journalists who cover their work. It’s a necessary partnership but one with more than a hint of distrust in both directions.</p>
<p>In a lemons-out-of-lemonade email sent to invitees after the embargo prompted them to close the event to journalists and the public, conference organizers wrote they hoped the decision would allow attendees to “speak freely and candidly without concerns about being misquoted or misinterpreted” – though apparently that wasn’t enough of a concern for them to bar media from the get-go. </p>
<p><div data-react-class="Tweet" data-react-props="{"tweetId":"729777013213401088"}"></div></p>
<p>The organizers of the meeting are surely not blameless for the public reception. The decision to respect the embargo was interpreted by the press as suspicious. If one goal of the meeting was to provoke, can the media be blamed for taking notice? And if the meeting was held in private, then isn’t it natural to ask what those in attendance have to hide?</p>
<p>The episode also points to an emerging conflict between social media and traditional science publishing. Research journals move at a glacial pace; nearly all of my colleagues have at at one point waited six months or more to publish. Will the long publication cycle and the <a href="https://theconversation.com/the-logic-of-journal-embargoes-why-we-have-to-wait-for-scientific-news-53677">normally obscure embargo policy</a> be able to adjust to an era when scientific discussions happen at the speed of Twitter?</p>
<p>Researchers must rely on journalists for their communication skills and the audience they reach. And journalists will play a crucial role in facilitating the ethical discussion around synthetic biology – one whose stakeholders include scientists as well as ethicists, policy makers and the broader public – and what the goals and action items of such a debate will be. Critically, a balance must be struck between the watchdog role of the press and the legitimate needs of any profession to carry out some of their discussions in private.</p>
<hr>
<p><em>This article was updated to include the reason why the research journal postponed publication of the HGP-Write group’s paper.</em></p><img src="https://counter.theconversation.com/content/59650/count.gif" alt="The Conversation" width="1" height="1" />
<p class="fine-print"><em><span>Jeff Bessen receives funding from the NIH and HHMI. </span></em></p>A recent closed meeting about building synthetic genomes raised suspicions about just what scientists were planning, away from the public eye.Jeff Bessen, PhD Candidate in Chemical Biology, Harvard UniversityLicensed as Creative Commons – attribution, no derivatives.tag:theconversation.com,2011:article/536772016-02-11T16:05:13Z2016-02-11T16:05:13ZThe logic of journal embargoes: why we have to wait for scientific news<figure><img src="https://images.theconversation.com/files/111203/original/image-20160211-29190-1yx92jl.jpg?ixlib=rb-1.1.0&q=45&auto=format&w=496&fit=clip" /><figcaption><span class="caption">Extra, extra! The embargo's lifted, read all about it.</span> <span class="attribution"><a class="source" href="http://www.shutterstock.com/pic.mhtml?id=248829895&src=id">Newspapers image via www.shutterstock.com.</a></span></figcaption></figure><p>Rumors were flying through the blogosphere this winter: physicists at the Advanced Laser Interferometer Gravitational-Wave Observatory (<a href="https://www.ligo.caltech.edu/">LIGO</a>) may finally have directly detected <a href="http://www.nature.com/news/gravitational-waves-6-cosmic-questions-they-can-tackle-1.19337">gravitational waves</a>, ripples in the fabric of space-time predicted by Einstein 100 years ago in his general theory of relativity. Gravitational waves were predicted to be produced by cataclysmic events such as the collision of two black holes.</p>
<p>If true, it would be a very big deal: a rare chance for scientists to grab the attention of the public through news of cutting-edge research. So why were the scientists themselves keeping mum?</p>
<p><div data-react-class="Tweet" data-react-props="{"tweetId":"686574829542092800"}"></div></p>
<p>This wouldn’t be the first time scientists thought they had detected gravitational waves. In March 2014, a group claimed to have done so. In that case, scientists announced their discovery when they posted an article in <a href="http://arxiv.org">arXiv</a>, a preprint server where physicists and other scientists share research findings prior to acceptance by a peer-reviewed publications. Turns out that group was <a href="http://www.nature.com/news/gravitational-waves-discovery-now-officially-dead-1.16830">wrong</a> – they were actually looking at galactic dust. </p>
<p>The LIGO scientists were more careful. Fred Raab, head of the LIGO laboratory, <a href="http://www.geekwire.com/2016/after-gravitation-wave-rumors-its-getting-close-to-go-time-for-advanced-ligo-results/">explained</a>:</p>
<blockquote>
<p>As we have done for the past 15 years, we take data, analyze the data, write up the results for publication in scientific journals, and once the results are accepted for publication, we announce results broadly on the day of publication or shortly thereafter. </p>
</blockquote>
<p><div data-react-class="Tweet" data-react-props="{"tweetId":"686587441478766592"}"></div></p>
<p>And that’s what they did, timing their news conferences and media outreach to coincide with the <a href="http://physics.aps.org/featured-article-pdf/10.1103/PhysRevLett.116.061102">official publication</a> in the scientific journal Physical Review Letters about their discovery. Why did they delay their public announcement rather than spread the word as widely as possible as soon as possible?</p>
<h2>Science’s standard operating procedure</h2>
<p>Although it may sound unnecessarily cautious, the process Raab described is how most scientists prepare and vet discoveries prior to announcing them to the world – and, indeed, it’s the process most scientific journals insist upon. <em>Nature</em>, for example, <a href="http://www.nature.com/authors/policies/embargo.html">prohibits</a> authors from speaking with the press about a submitted paper until the week before publication, and then only under conditions set by the journal. </p>
<p>Scientific publishing serves both the scientist and the public. It’s a quid pro quo: the authors get to claim priority for the result – meaning they got there before any other scientists did – and in return the public (including competing scientists) gets access to the experimental design, the data and the reasoning that led to the result. Priority in the form of scientific publishing earns scientists their academic rewards, including more funding for their research, jobs, promotions and prizes; in return, they reveal their work at a level of detail that other scientists can build on and ideally replicate and confirm. </p>
<p>News coverage of a scientific discovery is another way for scientists to claim priority, but without the vetted scientific paper right there alongside it, there is no quid pro quo. The claim is without substance, and the public, while titillated, does not benefit – because no one can act on the claim until the scientific paper and underlying data are available.</p>
<p>Thus, most scientific journals insist on a “press embargo,” a time during which scientists and reporters who are given advanced copies of articles agree not to publish in the popular press until the scientific peer review and publishing process is complete. With the advent of <a href="http://www.infotoday.com/searcher/oct00/tomaiuolo&packer.htm">preprint servers</a>, however, this process itself is evolving. </p>
<p><a href="http://dx.doi.org/10.1056/NEJM197706022962204">First introduced</a> in 1977, journal embargoes reflect a scientific journal’s desire both to protect its own <a href="http://dx.doi.org/10.1056/NEJM198110013051408">newsworthiness</a> and to protect the public from misinformation. If a result is wrong (as was the case with the 2014 gravitational wave result), peer review is supposed to catch it. At the least, it means experts other than the researchers themselves examined the experimental design and the data and agreed that the conclusions were justified and the interpretations reasonable. </p>
<p>Often, results are more “nuanced” than the news article or press conference suggests. Yes, this new drug combination makes a (minor) difference, but it doesn’t cure cancer. Finally, the result could be correct, but not because of the data in that paper, and the premature press conference claims an unwarranted priority that can disrupt other research. In all these cases, having access to the research article and the underlying data is critical for the news to be meaningful.</p>
<figure class="align-center zoomable">
<a href="https://images.theconversation.com/files/111035/original/image-20160210-12153-9yc2pi.jpg?ixlib=rb-1.1.0&q=45&auto=format&w=1000&fit=clip"><img alt="" src="https://images.theconversation.com/files/111035/original/image-20160210-12153-9yc2pi.jpg?ixlib=rb-1.1.0&q=45&auto=format&w=754&fit=clip" srcset="https://images.theconversation.com/files/111035/original/image-20160210-12153-9yc2pi.jpg?ixlib=rb-1.1.0&q=45&auto=format&w=600&h=338&fit=crop&dpr=1 600w, https://images.theconversation.com/files/111035/original/image-20160210-12153-9yc2pi.jpg?ixlib=rb-1.1.0&q=30&auto=format&w=600&h=338&fit=crop&dpr=2 1200w, https://images.theconversation.com/files/111035/original/image-20160210-12153-9yc2pi.jpg?ixlib=rb-1.1.0&q=15&auto=format&w=600&h=338&fit=crop&dpr=3 1800w, https://images.theconversation.com/files/111035/original/image-20160210-12153-9yc2pi.jpg?ixlib=rb-1.1.0&q=45&auto=format&w=754&h=424&fit=crop&dpr=1 754w, https://images.theconversation.com/files/111035/original/image-20160210-12153-9yc2pi.jpg?ixlib=rb-1.1.0&q=30&auto=format&w=754&h=424&fit=crop&dpr=2 1508w, https://images.theconversation.com/files/111035/original/image-20160210-12153-9yc2pi.jpg?ixlib=rb-1.1.0&q=15&auto=format&w=754&h=424&fit=crop&dpr=3 2262w" sizes="(min-width: 1466px) 754px, (max-width: 599px) 100vw, (min-width: 600px) 600px, 237px"></a>
<figcaption>
<span class="caption">Peer-reviewed and published.</span>
<span class="attribution"><span class="source">Maggie Villiger</span>, <a class="license" href="http://creativecommons.org/licenses/by-nd/4.0/">CC BY-ND</a></span>
</figcaption>
</figure>
<h2>Purposes of a press embargo</h2>
<p>A press embargo has additional benefits for the reporter, the journal and the public.</p>
<p>Multiple journalists get an equal chance to publish a well-researched and balanced article. In exchange for respecting the journal’s press embargo, reporters find out what’s being published in advance of publication. This gives multiple journalists a chance to read the scientific article, find experts who can help them make sense of the article, and publish a carefully crafted story. From the scientist’s (and scientific journal’s) perspective, this maximizes the quality and quantity of the coverage by the press.</p>
<p>The public gains access to the scientific article very close to the time they read the news story. The popular press tends to bias a story toward what’s “newsworthy” about it – and that sometimes winds up exaggerating or otherwise inaccurately summarizing the scientific article. When that article relates to human health, for instance, it’s important that doctors have access to the original scientific paper before their patients start inquiring about new treatments they’d heard about in the news.</p>
<p>Other scientific experts gain access to the scientific article as soon as the findings become news. Scientists who jump the gun and allow their research to become news before publication in an academic journal are making unvetted claims that can turn out to be less important once the peer-reviewed article eventually appears.</p>
<p>A press embargo can protect a scientist’s claim for priority in the face of competition from other scientists and journals. Scientists generally accept journal publication dates as indicators of priority – but when a discovery makes news, the journal considering a competitor’s paper often both releases its authors from the embargo and races the paper to publication. And, if your competitor’s paper comes out first, you’ve lost the priority race.</p>
<p>The embargo system allows time for prepublication peer review. Most experiments designed to address research questions are complicated and indirect. Reviewers often require additional experiments or analyses prior to publication. Prepublication peer review can take a long time, and its value <a href="http://dx.doi.org/10.1242/dmm.001388">has been</a> <a href="https://www.theguardian.com/science/occams-corner/2015/sep/07/peer-review-preprints-speed-science-journals">questioned</a>, but it is currently the norm. If a news story came out on the paper while it was under review, the process of peer review could be jeopardized by pressure to “show the data” based on the news article. Many journals would decline publication under those conditions, leaving the authors and public in limbo.</p>
<p>I know of no case in which talking about a discovery in advance of scientific publication helps the public. Yes, “breaking news” is exciting. But journalists and other writers can tell riveting stories about science that convey the excitement of discovery without breaking journal embargoes. And the scientific community can continue to work on speeding its communication with the public while preserving the quid pro quo of scientific publication.</p><img src="https://counter.theconversation.com/content/53677/count.gif" alt="The Conversation" width="1" height="1" />
<p class="fine-print"><em><span>Vivian Siegel does not work for, consult, own shares in or receive funding from any company or organization that would benefit from this article, and has disclosed no relevant affiliations beyond their academic appointment.</span></em></p>Sometimes big research news bypasses the usual scientific publishing process. Here’s why that’s not good for scientists or the public.Vivian Siegel, Visiting Instructor of Biological Engineering, Massachusetts Institute of Technology (MIT)Licensed as Creative Commons – attribution, no derivatives.tag:theconversation.com,2011:article/461092015-08-14T10:21:49Z2015-08-14T10:21:49ZJimmy Carter in Cuba<p>Thirty-eight years ago, Jimmy Carter and Fidel Castro agreed to open downgraded embassies called Interest Sections in Havana and Washington DC. Carter’s intent was to normalize relations between the two countries during his tenure. </p>
<p>Those intentions were derailed by Cuba’s <a href="http://www.latimes.com/opinion/la-oe-leogrande12-2009jan12-story.html#page=1">adventures</a> in Africa, the Mariel Boatlift <a href="http://www.globalsecurity.org/military/ops/mariel-boatlift.htm">refugee crisis</a> and the election of Ronald Reagan. </p>
<p>Carter left office, but the <a href="https://www.washingtonpost.com/news/worldviews/wp/2015/04/10/the-u-s-and-cuba-will-soon-agree-to-reopen-their-embassies-heres-what-happens-next/">Interest Sections</a> remained. </p>
<p>And now – five US and two Cuban presidents later – the Interest Sections are again embassies. US Secretary of State John Kerry will travel to Cuba on August 14 to raise the American flag over the embassy in Havana.</p>
<p>This new openness required courage from two reformist presidents, Barack Obama and Raul Castro, but Jimmy Carter’s initiatives beginning four decades ago helped pave the way. </p>
<h2>Domestic pressures</h2>
<p>It took six years in office before Obama had the political capital to spend on changing Cuba policy. </p>
<p>At the beginning of Obama’s administration, Cuban-Americans opposed to an opening controlled key positions in Congress. That group included Representative Ileana Ros-Lehtinen, R-Fla, then chairwoman of the House Foreign Affairs Committee, and Senator Robert Menendez, D-NJ, former chair of the Senate Foreign Relations Committee and the Democratic Senatorial Campaign Committee. Obama waited until after the last election of his tenure – the 2014 midterm vote – to announce the results of his secret negotiations with the Cuban regime.</p>
<p>In Cuba, Raul Castro initiated difficult economic reforms in 2011 to wean half a million citizens from the state’s payroll and allow small businesses to begin the transition from a state-owned economy to a partially <a href="http://www.brookings.edu/research/reports/2013/11/cuba-entrepreneurs-middle-classes-feinberg">market-led one</a>. He waited to get those reforms well under way before beginning to deal with the ambiguous politics of the United States. Still, Castro was pressed by the need to lift the financial strangulation imposed not only by the trade embargo but also the additional US financial restrictions on foreign banks dealing with Cuba.</p>
<p>By the time of the announcement in December 2014, <a href="http://www.atlanticcouncil.org/events/past-events/atlantic-council-poll-americans-want-new-relations-with-cuba">public opinion</a> in the US – even among Cuban-Americans – favored <a href="https://cri.fiu.edu/research/cuba-poll/2014-fiu-cuba-poll.pdf">normalization</a> and lifting the embargo.</p>
<p>Work Carter did decades ago helped change that public opinion.</p>
<h2>Throwing the first pitch</h2>
<p>In 1977, Carter’s policy changes were quite dramatic: he removed all travel restrictions on Americans to travel to Cuba and took the first big steps toward normalization while still in the midst of the Cold War. </p>
<p>In 2002 – well after leaving office in 1981 – <a href="http://www.cartercenter.org/news/documents/doc528.html">Carter traveled to Cuba</a> at the invitation of Fidel Castro, the first US president to do so after the 1959 Cuban Revolution. Carter sought to improve understanding between the two peoples and the two governments. </p>
<p>Carter made <a href="http://www.cartercenter.org/news/documents/doc517.html">a speech</a> in Spanish, broadcast live to the entire island, in which he called on the US as the more powerful country to take the first step and lift the embargo. He also called on the Cuban government to respect its own constitution by protecting free speech and assembly, and allowing the citizens to petition for a change in the laws. </p>
<p>He introduced the Cuban people to the <a href="http://www.oswaldopaya.org/es/up/VARELA%20PROJECT.pdf">Varela Project</a>, an effort led by human rights activist Osvaldo Paya to collect signatures to trigger a referendum for legislative reform. The state-controlled media had ensured that most Cuban people had never heard of the project prior to the speech. </p>
<p>I accompanied Carter on that trip, as then-director of The Carter Center’s <a href="http://www.cartercenter.org/peace/americas/index.html">Americas Program</a>, and I negotiated the terms for delivery of that speech with the Cuban authorities. I watched as Fidel Castro and his cabinet sat stony-faced on the front row of the University of Havana’s grand salon. Afterward, I feared a berating from Castro, but Castro only came up and said to Carter, “Let’s go watch the baseball game.” </p>
<p>Castro asked Carter for one favor – to walk out to the pitcher’s mound to throw out the first pitch without his security detail, to demonstrate Carter’s confidence in the Cuban people. Carter did so.</p>
<p>Carter and I <a href="http://www.cartercenter.org/news/trip_reports/cuba-march2011.html">traveled again </a>to Cuba in 2011, this time to meet President Raul Castro. Relations were stymied by the imprisonment of <a href="http://www.washingtonpost.com/local/amid-jubilation-marylander-alan-gross-is-released-from-cuban-incarceration/2014/12/17/e257c56e-8607-11e4-9534-f79a23c40e6c_story.html">American citizen Alan Gross</a> in Cuba and the competing priorities of both presidents. </p>
<p>Osvaldo Paya <a href="http://www.bbc.com/news/world-latin-america-19022749">died</a> tragically in a car accident in 2012. His petition campaign had been twice delivered to the National Assembly with more than the required 10,000 signatures, but not accepted. </p>
<h2>Change is coming</h2>
<p>Cubans are slowly gaining rights to improved communication and internet, but implementation remains slow. Competing political parties are still not allowed. The US trade embargo is still in place until the US Congress decides to lift it.</p>
<p>Nevertheless, leaders in both countries are paving the way to test Jimmy Carter’s persistent belief that the best way to improve the lives of all Cubans and to overcome differences with any government is through engagement. </p>
<p>The tide is rapidly turning in favor of closer relations between both countries. The excitement was palpable at the opening of the Cuban embassy in DC a month ago. </p>
<p>The holdouts in Congress – still blocking US companies who want to trade with Cuba and American citizens who want to travel freely – will be forced to give in sooner, rather than later. </p>
<p>When that happens, we should give some of the credit to Jimmy Carter.</p><img src="https://counter.theconversation.com/content/46109/count.gif" alt="The Conversation" width="1" height="1" />
<p class="fine-print"><em><span>Jennifer Lynn McCoy is former director of the Carter Center's Americas Program and current Director of the Global Studies Institute at Georgia State University.</span></em></p>John Kerry will raise the flag over the American Embassy in Cuba on Friday. That moment is possible thanks to work Jimmy Carter began four decades ago.Jennifer Lynn McCoy, Distinguished University Professor of Political Science and Founding Director of the Global Studies Institute, Georgia State UniversityLicensed as Creative Commons – attribution, no derivatives.tag:theconversation.com,2011:article/50632012-01-30T19:34:52Z2012-01-30T19:34:52ZHalf-hearted Iran embargo won’t push up oil prices<figure><img src="https://images.theconversation.com/files/7228/original/2db4cb42-1327898415.jpg?ixlib=rb-1.1.0&q=45&auto=format&w=496&fit=clip" /><figcaption><span class="caption">Partial boycotts don't work; it's too easy to secure new buyers and sellers.</span> <span class="attribution"><span class="source">AAP</span></span></figcaption></figure><p>The European Union (EU) <a href="http://www.guardian.co.uk/world/2012/jan/23/eu-ambassadors-iranian-oil-embargo?intcmp=239">voted last week</a> to ban oil imports from Iran. The EU will immediately ban the signing of any new oil contracts with Iran, while the existing ones will be fulfilled up to 1 July. According to EU officials, this gradual approach has been devised so that the oil market can <a href="http://www.atimes.com/atimes/Middle_East/NA26Ak01.html">absorb the embargo’s impact</a>.</p>
<p>In response, Iran has said it may cut crude oil shipments to Europe early. Iranian officials have <a href="http://www.nytimes.com/2012/01/27/world/middleeast/ahmadinejad-says-iran-is-ready-for-nuclear-talks.html">threatened to stop exporting crude</a> to the EU promptly in order to provoke a surge in prices and prevent European countries from finding other supplies at similar costs in the short term.</p>
<p>Many analysts have predicted that the <a href="http://economictimes.indiatimes.com/markets/commodities/eu-sanctions-on-iran-may-push-oil-prices-to-150/articleshow/11681036.cms">oil prices will increase</a> as a result of either, or both, of these actions. </p>
<p>Earlier this month <a href="https://theconversation.com/an-eu-oil-embargo-is-unlikely-to-curtail-irans-nuclear-ambitions-4876">I wrote</a> that an oil embargo would do little to curtail Iran’s nuclear activities. I would also argue it will do little to affect supply, demand or the price of oil.</p>
<p>The EU embargo may push world oil prices to $150 per barrel, the head of Iran’s state oil company has said. “It seems that we will witness prices from $120 to $150 in the future,” Ahmad Qalehbani, head of the National Iranian Oil Company, said in an <a href="http://www.eurasiareview.com/29012012-iran-warns-oil-prices-may-jump-to-150-after-eu-sanctions/">interview with IRNA news agency</a>.</p>
<p>Meanwhile, the International Monetary Fund (IMF) warned that sanctions on Iran <a href="http://en.rian.ru/business/20120126/170959132.html">could push oil prices up</a> 20-30% to $140 per barrel unless alternative supplies from developing countries come on line.</p>
<p>But history tells us that the embargo from either side will not have a significant effect on the international oil market and will not be effective in achieving political objectives. The <a href="http://en.wikipedia.org/wiki/1973_oil_crisis">1973–74 oil price increase</a> was not caused by the oil “embargo” (refusal to sell) that the Arab members of OPEC directed at the United States and the Netherlands. </p>
<p>Instead, OPEC reduced its production of crude oil, raising world market prices sharply. The embargo against the US and the Netherlands had no effect whatsoever: people in both nations were able to obtain oil at the same prices as people in all other nations.</p>
<p>The bottom line is that limited boycotts or embargoes of <a href="http://www.google.com.au/search?sourceid=chrome&ie=UTF-8&q=definition+fungible#hl=en&q=fungible&tbs=dfn:1&tbo=u&sa=X&ei=RBsmT-2oNeiSiQfD4sXiBA&ved=0CCUQkQ4&bav=on.2,or.r_gc.r_pw.,cf.osb&fp=6720b9450237bf30&biw=1533&bih=1233">fungible</a> commodities, such as crude oil, are ineffective. Total boycotts are effective (until the smugglers spring into action), but not limited ones. When a limited boycott, or embargo, is employed, the market simply gets rebalanced. </p>
<p>A selective embargo causes some inconvenience, but is easily circumvented by reshuffling suppliers. In 1973-74, the countries selectively embargoed (the US and the Netherlands) shifted suppliers to non-Arab countries, and more Arab oil went to the countries previously supplied by the non-Arab producers. This failure of the embargo was predictable, in that oil can be resold among buyers, and moved around easily and on short notice.</p>
<p>The US and EU pressure on Iran has already caused changes in oil import-export patterns in 2011. OECD countries have been “aggressively seeking alternative supplies, especially [from] Saudi Arabia,” <a href="http://www.bloomberg.com/news/2012-01-18/opec-crude-output-rose-to-most-in-more-than-3-years-iea-says.html">according to the IEA</a>. Iranian oil shipments are increasingly heading toward non-OECD Asian buyers, China and India.</p>
<p>This trend will continue. In 2010, the EU’s oil imports from Iran accounted for 6% of its total, about 450,000 barrels per day (bpd), or 18% of Teheran’s oil exports. This is barely 0.5% of global supply – not a large amount of oil. Thus, it will not take long for Iran to secure new contracts with China or India, or for the EU to secure new contracts with Saudi Arabia, Kuwait, UAE or Russia.</p>
<p>The price of oil depends in part on supply and demand, neither of which is likely to be affected directly by the EU oil embargo or Iranian EU export ban. Prices of oil will not be affected by the EU’s or Iranian actions as long as their respective oil demand (EU) and supply (Iran) remain steady.</p>
<p>Only cuts in oil production or total boycotts will have an effect on the oil market, as in 1973-74. But Tehran is not going to cut oil production, thus cutting its main revenue stream. Besides, a production cut would not just hurt the target (the EU), but all consumers equally.</p>
<p>Neither is a worldwide boycott of Iranian oil likely to materialise. China and India are reluctant or absolutely against complying with the US and EU sanctions on Iranian crude. Similarly, all of the major global oil suppliers will not ban exports to the EU. If the Iranians stop exporting oil to the EU, other suppliers will simply step in.</p><img src="https://counter.theconversation.com/content/5063/count.gif" alt="The Conversation" width="1" height="1" />
<p class="fine-print"><em><span>Vlado Vivoda receives funding from the ARC.</span></em></p>The European Union (EU) voted last week to ban oil imports from Iran. The EU will immediately ban the signing of any new oil contracts with Iran, while the existing ones will be fulfilled up to 1 July…Vlado Vivoda, Research Fellow, Griffith Asia Institute, Griffith UniversityLicensed as Creative Commons – attribution, no derivatives.tag:theconversation.com,2011:article/48762012-01-08T19:31:21Z2012-01-08T19:31:21ZAn EU oil embargo is unlikely to curtail Iran’s nuclear ambitions<figure><img src="https://images.theconversation.com/files/6798/original/4tfhgbs5-1326006857.jpg?ixlib=rb-1.1.0&rect=197%2C197%2C3531%2C2205&q=45&auto=format&w=496&fit=clip" /><figcaption><span class="caption">A proposed EU oil embargo may push Iranian President Mahmoud Amadinejad closer to China and Venezuela.</span> <span class="attribution"><span class="source">AAP</span></span></figcaption></figure><p>Last week the European Union indicated that it <a href="http://www.youtube.com/watch?v=gZVpNUzBRt4">is likely to enact an oil embargo</a> on Iran. The move is aimed at damaging Iran’s crucial oil export business enough so the country’s regime curtails its nuclear ambitions but not enough to cause oil prices to spike. The recent EU policy shift moves the bloc in line with the US long-standing hardline approach to Iran. </p>
<p>The <a href="http://www.bbc.co.uk/news/world-middle-east-16447592">sanctions adopted by President Barack Obama</a> on New Year’s Eve target financial institutions that do business with Iran’s central bank by barring them from opening or maintaining operations in the US. The sanctions will apply to foreign central banks only for transactions that involve the sale or purchase of crude oil or petroleum products.</p>
<p>Iran has 10% of the world’s oil reserves and is the <a href="http://www.bp.com/assets/bp_internet/globalbp/globalbp_uk_english/reports_and_publications/statistical_energy_review_2011/STAGING/local_assets/pdf/statistical_review_of_world_energy_full_report_2011.pdf">third largest exporter</a>. Much of Iran’s oil exports flow to its growing Asian markets, particularly China, which imports about a third of Iranian oil. The EU currently imports between 15% and 20% of Iranian oil. The US has not imported any oil from Iran since the 1979 Islamic Revolution.</p>
<p>It is unlikely that the newly imposed sanctions by the US and the EU’s embargo threat will be effective in curtailing Iran’s nuclear ambitions. If anything, the West’s actions will draw Iran diplomatically closer to China and Venezuela, another oil exporter at odds with the US. </p>
<p>Iran’s <a href="http://www.foreignpolicy.com/articles/2006/04/25/the_oil_shield">“oil shield”</a> has kept it safe from Western interference in its nuclear program over the past decade. This is unlikely to change. Beijing has indicated that it does not intend to support the US sanctions and has <a href="http://www.cnbc.com/id/45898798">publicly rejected them</a>. Beijing’s recalcitrance is unsurprising in the context of Washington’s recent “<a href="http://www.forbes.com/sites/greatspeculations/2012/01/05/obama-acts-to-counter-china-military-threat/">China threat” rhetoric</a>, which has been aimed at countering the perceived growing military threat to the US interests in Asia.</p>
<p>Meanwhile, the Iranian President Mahmoud Ahmadinejad is visiting Latin America, cementing <a href="http://www.sananews.net/english/2012/01/iranian-president-to-visit-us-foes-in-latin-america/">Tehran’s close relationship with Caracas</a>. </p>
<p>If sanctions get implemented, Tehran will likely have to sell its output at a discount to its remaining buyers and any new ones. China and India are likely to benefit from cheaper oil. The smaller purchases of Iranian crude might be a tactic adopted by Beijing and New Delhi aimed at obtaining lower prices as the West squeezes Tehran. The EU, on the other hand, will have to pay a premium to secure new contracts with alternative exporters, such as Russia and Saudi Arabia.</p>
<p>Some <a href="http://www.csmonitor.com/World/Asia-Pacific/2012/0105/EU-s-Iran-oil-ban-Will-China-help-Tehran">analysts have suggested </a>that China will not buy more from Iran in the event of a European embargo citing the importance of diversified sources of oil imports. Yet, in the past two decades China’s oil imports have grown by approximately 15% each year. In 2010, they increased by about 600,000 barrels per day (bpd). </p>
<p>Consequently, in the coming years, Beijing will get its hands on any additional supplies available in the market to fuel growing oil import demand. China already has a highly <a href="http://www.eai.or.kr/type/panelView.asp?bytag=p&code=eng_jeas&idx=10133&page=1">diversified oil import portfolio</a>. Adding up to an extra 300,000 barrels per day from Iran would not affect its overall diversification strategy.</p>
<p>Therefore, the US sanctions and the EU’s proposed embargo on Iran’s oil exports are unlikely to be effective in curtailing Iran’s nuclear ambitions, as Tehran gets closer to Beijing and other states at odds with the West. The proposed sanctions are likely to cause a minor rebalance in the international oil markets. This rebalancing will benefit the growing oil importers in Asia (China and India) and oil exporters that will sell more of their oil to the EU.</p><img src="https://counter.theconversation.com/content/4876/count.gif" alt="The Conversation" width="1" height="1" />
<p class="fine-print"><em><span>Vlado Vivoda receives funding from the Australian Research Council.</span></em></p>Last week the European Union indicated that it is likely to enact an oil embargo on Iran. The move is aimed at damaging Iran’s crucial oil export business enough so the country’s regime curtails its nuclear…Vlado Vivoda, Research Fellow, Griffith Asia Institute, Griffith UniversityLicensed as Creative Commons – attribution, no derivatives.