Cuba and Iran, two countries that have been off-limits to the United States, are slowly opening up to business. Many companies are excited at the prospect of charting ‘uncharted’ business terrain, but there are many hurdles and obstacles along the way. For Cuba, a 54-year stalemate is difficult to forget. Iran, on the other hand, is still feeling worldwide sanctions from the USA.
Not Quite Open for Business
The two countries are on the verge of opening up for business, fueling an increase in corporate interest. Ed Daly of iJet International says the countries are “about to be infused with a lot of money, which means a lot of investments and a lot of infrastructure and opportunity.” He adds, “Those who get in early are more likely to fare better and have better relations with the locals, which is key to establishing a long-term presence.”
For many U.S. companies, the potential businesses in Cuba include telecommunication and Internet Industries, provisions of construction and agricultural materials, as well as sales of consumer electronics. The normalizing relations mean that both Washington and Havana are taking steps to ease interactions between one another, with the reopening of the U.S. Embassy in Havana as the first step.
Ralph Gazitua has visited Cuba twice this year and his logistics company, WTDC, handles the shipping of goods to international destinations within the country. He considers this a new opportunity: “We want to be able to break ground. That’s why we decided to go there.” Despite this, there are still many obstacles, such as existing regulations that do not allow local entrepreneurs to purchase American products.
Whereas corporate interests in Cuba are mostly electronics and infrastructure development, business prospects in Iran are more on oil, energy, and engineering to help further develop the country’s roads and buildings.
Despite the optimistic prospects on the two countries, John Kavulich, president of the U.S.-Cuba Trade and Economic Council, says, “What we have now are companies chasing dreams as opposed to chasing reality.” He adds, “It’s important to be excited about a new market opportunity, but it’s equally and necessarily responsible to make certain the opportunity being sought is reasonable for the existing environment.”
The opening and easing of trade relations with both Cuba and Iran are a sign that the U.S. is shifting towards a more cooperative stance to the world’s nations. Despite this, these countries still have a long way to go for them to fully be “open for business.”