Canadian Firm Hit by U.S.’ Cuban Crackdown

In the first enforcement of a law that has angered U.S. allies, the State Department said Wednesday that it will deny visas to senior executives, top shareholders and their families from a Canadian mining company accused of “trafficking” in confiscated U.S. property in Cuba.

Sherritt International--co-owner with the Cuban government of a nickel mine on the eastern end of the island, among other investments--is the first company targeted under the Helms-Burton law. The measure tightens the 33-year-old U.S. embargo against the Communist nation 90 miles off the Florida coast.

Helms-Burton has infuriated U.S. trading partners, especially Canada and Mexico. They are particularly angry because of provisions denying visas to the spouses and children of executives of companies that do business related to property that U.S. investors owned before the 1959 Cuban revolution.

“It’s ludicrous that kids wanting to go to Disneyland can’t go if they’re the kids of those associated with these companies,” Canadian Trade Minister Art Eggleton said in a recent interview.

Privately, Canadians have questioned how the visa revocations could be enforced at the virtually open U.S.-Canada border.

At a briefing in Washington announcing the notification of the company executives affected, State Department spokesman Nicholas Burns defended the provision affecting families as “likely to enhance . . . the threat that is contained very clearly in Helms-Burton.”

Sherritt executives repeatedly have said the corporation will not leave Cuba.

“It’s offensive to us and it’s offensive to Canadians,” corporate spokeswoman Patrice Best said. “We do business legally in Canada, legally in Cuba, legally in every jurisdiction where we operate. We do not operate in the United States.”

Burns said company executives were notified in letters dated Tuesday that after 45 days, they will not be allowed to enter the United States. The period is supposed to allow the company time to reconsider its investments in Cuba.

“It is unconventional,” Burns said. “It is a very tough action that we are taking today.”

Matthew Lambert of the Center for International Policy in Washington said the move could adversely affect U.S.-Canada relations and lead to retaliation.

“Rather than working together with Canada and the [European Union] to bring democracy to Cuba, we are making decisions for the entire world,” he said.

The tone of rhetoric on both sides has been rising for weeks. The Canadian media widely reported U.S. politicians’ threats against those who do business in Cuba. For example, U.S. Rep. Lincoln Diaz-Balart (R-Fla.) predicted that after President Fidel Castro, his uncle, falls from power, Cubans will kidnap foreign investors who “collaborated” with Castro and bring them back for trial on the island.

A coalition of Canadian church, labor and relief groups called on tourists Wednesday to boycott Florida, the stronghold of anti-Castro forces that backed Helms-Burton.

“How can we vacation in a place that votes for illegal legislation that bullies its neighbors and harms poor people in Cuba?” Marion Dewar, head of the relief group Oxfam-Canada, asked at a news conference. Florida is by far the No. 1 tourist destination for Canadians.

The law seeks to discourage foreign investment in Cuba at a time when the island nation is desperately looking for capital to substitute for the loss of subsidies and aid from the former Soviet Union.

While revenues generated from foreign investment account for only about 3% of Cuba’s economy, Cuban Foreign Investment Ministry spokesman Mario Rodriguez said in a recent interview that international capital has played a crucial part in that country’s nascent economic recovery by providing know-how and capital.

Helms-Burton was signed into law weeks after Cuban MIGs shot down two airplanes piloted by exiles in the Florida Straits, killing four pilots.

The legislation is named for its two principal sponsors, Sen. Jesse Helms (R-N.C.) and Rep. Dan Burton (R-Ind.). It was signed by President Clinton on March 12.

Burns said Helms-Burton is forcing foreign companies to reassess their operations in Cuba. He said four European firms involved in financing Cuba’s sugar harvest have decided to pull out.

Sherritt was widely expected to be among the first companies singled out under the law because of its high profile in Cuba. Chairman Ian Delaney takes pride in being known as “Castro’s favorite capitalist.”

In addition, the Fort Saskatchewan, Alberta-based company’s investments are crucial to Cuba. The nickel mine and refinery it co-owns with the Cuban government are important sources of foreign exchange and accounts for nearly half the island’s nickel production. The refinery in western Canada is the first Cuban investment off the island and allows the country to benefit from the higher price of processed metals as compared with nickel ore.

Oil wells Sherritt operates near the famous Varadero beach resort account for about a third of Cuba’s domestically produced oil, approximately 7,000 barrels a day, Best said.

U.S. investors recently filed claims on the oil wells. The nickel mine was originally owned by Freeport-McMoRan Inc. of New Orleans, one of 5,911 U.S. companies that have filed claims for compensation against Cuba for expropriated assets. Companies from other countries have long since been compensated.