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Cuba and Ecommerce: Close, but No Cigar Just Yet

Cuba is slightly smaller than Pennsylvania, but the prospect of trade between the US and Cuba is looming large. A trade embargo imposed by the US in the early 1960s remains, but if lifted, it could provide online sellers with economic opportunity.

Relations between the two countries have been softening since December 2014. On Wednesday, the USPS announced the resumption of direct transportation of mail service with Cuba for the first time in over 50 years.

The types of mail US citizens can send to Cuba include First-Class Mail International items, such as postcards and letter size envelopes, First-Class Package International Service items, Priority Mail International Flat Rate Envelopes and Priority Mail International Small Flat Rate Priced Boxes.

But that doesn’t mean sellers can send products to buyers in Cuba thanks to the embargo. Even gift and humanitarian donations are subject to strict mailing conditions – see the International Mail Manual.

As President Obama loosens certain restrictions, he can only go so far. It is up to Congress to lift the embargo, NPR noted last week.

But this week’s historic visit to Cuba by President Obama speaks volumes about the expectations around trade. Among the US business leaders joining the President on the trip to Havana is PayPal President Dan Schulman and Stripe founder Patrick Collison, whose payment processing firm is launching business in Cuba and aims to serve Cuban tech startups.

In January, the Wall Street Journal noted that the Obama administration’s removal of US limits on money transfers was helping small, private businesses in Cuba.

What about domestic ecommerce? We checked in with Leo Siqueira, Director for Latin America for the AIM Group. He said despite having limited access to Internet, Cubans can navigate the web in one of the island’s “public centers,” which offer high speed Internet connection for about 2 CUC/hour – most of the island’s provinces have about two centers that offer access to internet, he said.

In addition, paquetes provide offline deliveries of digital information each week – they are illegal, but tolerated, he said.

Siqueira said Cuba’s number-one classifieds portal is Revolico, followed by Cubisima, but they are not officially allowed to be accessed by the public centers. The Cuban government launched Ofertas.cu, a government-run classified website with a print version. “It’s not as strong as Revolico and Cubisima, but it’s a move by the Cuban government to establish a “legal” way people can search the web for classified listings,” Siqueira said.

In terms of cross border trade, any thoughts on when US companies could sell to Cuban businesses and citizens? “It will depend on when the embargo the US has imposed to Cuba will be lifted as well as when Cuban regulations will somehow allow US companies to sell to the island,” he said.

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Ina Steiner
Ina Steiner
Ina Steiner is co-founder and Editor of EcommerceBytes and has been reporting on ecommerce since 1999. She's a widely cited authority on marketplace selling and is author of "Turn eBay Data Into Dollars" (McGraw-Hill 2006). Her blog was featured in the book, "Blogging Heroes" (Wiley 2008). Follow her on Twitter at @ecommercebytes and send news tips to ina@ecommercebytes.com.