Israeli trade delegation to Cuba may augur a diplomatic thaw
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Israeli trade delegation to Cuba may augur a diplomatic thaw

Despite the the lack of formal relations between the two countries, a high-level commercial trip highlights mutual interests and potential prospects

  • Israeli tourists negotiate with a taxi driver at the cruise ship terminal in Old Havana. (Larry Luxner/Times of Israel)
    Israeli tourists negotiate with a taxi driver at the cruise ship terminal in Old Havana. (Larry Luxner/Times of Israel)
  • Stone memorial to Jerusalem adorns the lobby of the Hotel Raquel, a Jewish-themed boutique hotel in Old Havana. (Larry Luxner/Times of Israel)
    Stone memorial to Jerusalem adorns the lobby of the Hotel Raquel, a Jewish-themed boutique hotel in Old Havana. (Larry Luxner/Times of Israel)
  • Former Mossad spy chief Rafi Eitan, 90, listens to speakers during a Tel Aviv seminar on doing business in Cuba. Eitan’s Grupo BM has extensive interests on the island. (Larry Luxner/Times of Israel)
    Former Mossad spy chief Rafi Eitan, 90, listens to speakers during a Tel Aviv seminar on doing business in Cuba. Eitan’s Grupo BM has extensive interests on the island. (Larry Luxner/Times of Israel)
  • A taxi driver has no choice but to push his loaded taxi. (Larry Luxner/Times of Israel)
    A taxi driver has no choice but to push his loaded taxi. (Larry Luxner/Times of Israel)
  • Ronen Peleg, chief financial officer for Grupo BM, speaks at a November 9 seminar in Tel Aviv on doing business in Cuba. (Larry Luxner/Times of Israel)
    Ronen Peleg, chief financial officer for Grupo BM, speaks at a November 9 seminar in Tel Aviv on doing business in Cuba. (Larry Luxner/Times of Israel)
  • Israeli executives listen to a November 9 presentation in Tel Aviv about doing business in Cuba. (Larry Luxner/Times of Israel)
    Israeli executives listen to a November 9 presentation in Tel Aviv about doing business in Cuba. (Larry Luxner/Times of Israel)

In early December, Cuba quietly welcomed an Israeli trade delegation to Havana for the first time since Cuba severed ties with the Jewish state in 1973.

The delegation slipped in around the same time that the Castro regime — which has shaky relations with Washington and none at all with Jerusalem — labeled President Donald Trump’s recognition of Jerusalem as the capital of Israel a “grave and flagrant violation” against the United Nations, which on December 21 voted overwhelmingly to condemn the US decision.

Needless to say, official diplomatic ties with Israel are still off the table.

In all, 14 Israelis joined the December 5-7 mission to Cuba, paying an average $2,500 each for the trip. The visit included excursions to the Mariel industrial free zone, various factories and a local Holocaust memorial.

Gabriel Hayon, CEO of the Tel Aviv-based Israel-Latin America Chamber of Commerce, said the unusual trip was a success, even if hasn’t yet resulted in any specific business deals.

“Our major accomplishment was the warm reception we received from the Cuban Chamber of Commerce,” said Hayon. “On the Cuban side were many government officials whose agencies are related to the sectors our people were interested in: biopharma, tourism, agriculture and infrastructure.”

Entrance to the Israeli-financed Miramar Trade Center along Havana’s Quinta Avenida. (Larry Luxner/Times of Israel)

In Hayon’s view, the major impediment to Israeli trade with Cuba isn’t the lack of diplomatic relations between the two countries, but the lack of cash the Castro regime has available to spend on Israeli products and know-how.

“The Israelis will be very cautious when doing business with Cuba,” Hayon told The Times of Israel. “We are not expecting anybody to put money up front from day one. And from the Cuban side, things take a lot of time.”

Cultural ties suddenly blooming

Even without diplomatic ties, the pace at which once-icy relations between Havana and Jerusalem are thawing has been nothing short of dramatic.

In October 2016, for the first time ever, Israel abstained — along with the United States — in the annual UN ritual condemning the US trade embargo. This allowed the resolution to pass the UN General Assembly by a vote of 191-0.

In early October, Culture Minister Miri Regev traveled to Cuba, marking the first time since 1973 an Israeli cabinet minister had set foot on the island. Then, in early November, Cuba’s famed Lizt Alfonso Dance Company gave four sellout performances at the Tel Aviv Opera House, followed by concerts in Ashdod, Jerusalem and Haifa.

Cuba’s Buena Vista Social Club followed in December with a series of concerts around Israel.

None of these trips could have taken place without official permission from the Castro regime — or without encouragement from the government of Prime Minister Benjamin Netanyahu.

Gabriel Hayon, CEO of the Israel-Latin America Chamber of Commerce, discusses his organization’s upcoming trade mission to Cuba. (Larry Luxner/Times of Israel)

“There is, of course, interest in renewing our relations with Cuba, along with other countries that severed their ties with us,” said Yoed Magen, director of the Israeli Foreign Ministry’s department of Central America, Mexico and Caribbean affairs, when asked if such ties would be restored anytime soon. “But it’s not going to be that easy — and this is where it stands right now.”

In early 2017, Israel restored diplomatic relations with Nicaragua’s left-leaning Sandinista government after a seven year hiatus. It was part of a growing interest in Latin America that in September also saw Prime Minister Benjamin Netanyahu make the first-ever visit by an Israeli head of state to Latin America (he spent 10 days in Argentina, Mexico and Colombia before heading to New York for a speech at the United Nations).

Magen, a former Israeli ambassador to Panama and Colombia, acknowledged that in 2016, “we changed the way we voted on Cuba [at the UN] along with the Americans. However, US-Cuba relations stand on their own. We don’t depend on them, and they certainly don’t depend on us. It’s much more complex.”

Pushed for details, he added with a smile: “If there are secret talks going on [with Cuba] like there were with Nicaragua, we can’t comment on that. You know how it is.”

Israeli executives listen to a November 9 presentation in Tel Aviv about doing business in Cuba. (Larry Luxner/Times of Israel)

Apparently, secret talks were going on as recently as one and a half years ago, led by Magen’s boss, Modi Ephraim, and with Canada acting as intermediary. Yet those talks fizzled once US President Donald Trump was elected.

Later, following Trump’s crackdown on US travel to Cuba, Israel reversed course and went back to its traditional support of the embargo — voting, along with the United States, against the UN resolution to condemn it. Observers say that Israel had little choice but to play along.

Long history of friendship

Surprisingly, Israel and Cuba weren’t always at odds with each other. As far back as 1919, Cuba’s Senate recognized the Jewish people’s right to national independence, and in 1942 — with the Nazi extermination of Jews already underway — it condemned “in the most energetic manner the persecution of the Hebrew race by the authorities of the Axis.”

Under the Batista dictatorship, which lasted from 1952 to 1958, the island’s 15,000 or so Jews enjoyed unparalleled economic success in retail and manufacturing. And even when Castro and his band of revolutionaries overthrew the Batista regime — and most of Cuba’s Jews fled to South Florida — those warm relations continued.

“Israel was one of the first states to recognize the revolutionary government,” notes historian Margalit Bejarano, director of the Latin America, Spain and Portugal division at Hebrew University in Jerusalem.

Stone memorial to Jerusalem adorns the lobby of the Hotel Raquel, a Jewish-themed boutique hotel in Old Havana. (Larry Luxner/Times of Israel)

“In the eyes of the Israeli government, the enthusiasm that surrounded Castro’s revolution was similar to the atmosphere of the nascent Israel in 1948. Foreign minister Golda Meir offered technical assistance to Cuba, not only as a diplomatic tool, but because she felt an ideological affinity with the Cuban Socialist revolution and was committed to assisting developing countries,” says Bejarano.

That friendship was not destined to last. Despite Fidel’s adamant opposition to anti-Semitism and his condemnation of Holocaust deniers, the Castro regime became closely identified with the Palestinian cause. After the Six Day War of 1967, Cuban state media began attacking “Israeli aggression” and Havana quietly began collaborating with Yasser Arafat’s Palestine Liberation Organization to train guerrillas.

Cuba’s contempt for official Israeli policies continued despite the eventual collapse of the Soviet Union, which drove the island to economic desperation.

Yet anti-Semitism was never a problem. For years, Cuba’s 1,000 or so Jews have received special rations for kosher meat, and under an arrangement code-named “Operation Cigar,” hundreds of them have been allowed to resettle in Israel. (In December 1998, Fidel himself visited the Patronato synagogue in Havana’s Vedado district, where he put a kipa on his head and helped light Hanukkah candles. A photo taken during that two-hour visit hangs on the walls of the Patronato to this day.)

Former Mossad spy chief Rafi Eitan, 90, listens to speakers during a Tel Aviv seminar on doing business in Cuba. Eitan’s Grupo BM has extensive interests on the island. (Larry Luxner/Times of Israel)

One of Fidel’s friends was Rafi Eitan, one of the Mossad’s most celebrated intelligence agents.

Eitan was famous in Israel for having masterminded the 1960 capture of Nazi war criminal Adolf Eichmann in Buenos Aires. Eitan was also the handler for Jonathan Pollard — a US Navy analyst who in 1985 was caught spying for Israel and sentenced to life imprisonment. Declared persona non grata by Washington, Eitan surfaced in Cuba, where his relationship with Fidel landed the former spy his first contract with the Cuban government.

Keeping a low profile in Cuba

Eitan’s company, Grupo BM, gradually turned a failing 40,000-hectare citrus orchard near Jagüey Grande, in the province of Matanzas, into a successful export operation. BM later branched out into construction and real estate; in the mid-1990s, a joint venture under its control — Inmobiliaría Monte Barreto — built suburban Havana’s Miramar Trade Center, which today houses the offices of dozens of foreign companies.

“It’s no secret that companies working in Cuba have problems because of the US embargo,” says Ronen Peleg, BM’s export manager. “Most of them try to keep a low profile and not get into trouble.”

Israeli tourists negotiate with a taxi driver at the cruise ship terminal in Old Havana. (Larry Luxner/Times of Israel)

Peleg, 51, has been involved with Grupo BM since January 1993. Over a 20-year period, the company’s involvement in the Jagüey Grande citrus operation helped generate $680 million in orange and grapefruit exports for Cuba.

“This started out as a contract to finance and upgrade an existing citrus orchard,” he explained. “We didn’t invest our own money. What we brought was know-how and lines of credit from external entities.”

BM is no longer involved in citrus, nor is it a shareholder in Monte Barreto, though its operations are still housed in the Miramar Trade Center’s Edifio Jerusalén — one of six buildings that make up Cuba’s largest office complex.

Peleg says BM has about 20 employees and annual turnover of $25 million. This comes from sales of tractors, agricultural equipment, fertilizer, irrigation technology and related machinery to various Cuban state entities. “In Cuba, everybody deals with the government,” he said. “There’s no other option.”

1950s era Ford drives past the Empress of the Seas cruise ship docked in Habana Vieja. (Larry Luxner/Times of Israel)

Carlos Alzugaray, Cuba’s former ambassador to the European Union and a frequent commentator on US-Cuba relations, says his country’s future ties with Israel rest, to a large degree, on the Jewish state’s ability to make peace with the Palestinians.

“I don’t think we in Cuba are unsympathetic to the Israeli tradition. I myself was a big fan of the kibbutz movement,” says Alzugaray. “But our attitude toward Israel is contradictory. As we see it, Israel bases its independence and self-determination too much on abusing the Palestinians and denying them their homeland. I don’t know if the Israelis will ever be able to extricate themselves from this problem.”

In the meantime, business is business — and Hayon says the most attractive sectors for Israeli companies in Cuba are agriculture (poultry, fish, pork, irrigation, citrus, fertilizer, seeds and pesticides); water and sewage treatment; energy (especially wind and solar technology); food production (coffee, juice and alcohol); real estate (offices, factories, and hotel management); chemicals (for local industry and agriculture) and pharmaceuticals (for both the local market and potential export to Latin America and the Caribbean).

A taxi driver has no choice but to push his loaded taxi. (Larry Luxner/Times of Israel)

“I think Israeli know-how can contribute greatly to Cuba’s agricultural sector with industrialization — giving farmers better yields than they have today — and also in food production, implementing modern, innovative technology,” says Hayon. “Those two points alone will reduce Cuba’s dependence on imports.”

Hayon, who spent 15 years in the Dominican Republic where he ran factories and other business ventures, said that since former US president Barack Obama’s 2015 visit to Cuba — which marked the restoration of diplomatic ties between Washington and Havana after a 54-year hiatus — potential Israeli investors have been prodding him about opportunities there.

While Trump hasn’t revoked those ties, his administration has cracked down on US travel to Cuba and recently expelled two-thirds of the diplomats working at Cuba’s embassy in Washington in the wake of a mysterious illness plaguing US diplomats in Havana.

“For several years, we were expecting things would improve in Cuba, and we realized this is the right moment,” Hayon said. “Unfortunately, it came at the same time Trump changed the rules of the game a bit, but that has nothing to do with us. Cuba is not an enemy of Israel.”

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