Cuba Waits for Obama as Ailing Fidel Castro Fades From Scene

Washington may move first to break the decades-old Cold War standoff with Havana.

The same aging U.S. automobiles have been plying the streets of Havana, Cuba’s capital, for decades.

The same aging U.S. automobiles have been plying the streets of Havana, Cuba’s capital, for decades.

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There are no signs of an East European-style upheaval in Cuba. People grumble loudly over their struggle to buy food and house themselves adequately, but the picture on the island of 11.2 million is not one of destitution or of a population seething with discontent. Though buffeted by the global recession, Cuba's economy has been advancing, in spite of the ban on most U.S. trade, investment, and travel. Growth was 7.3 percent in 2007 and 4.3 percent last year. Revenue from tourism and joint ventures with overseas companies keeps growing. Venezuelan oil subsidies continue, and Cuba's friends in Brazil, China, and Russia are joining a potentially lucrative game that U.S. firms cannot play: offshore oil exploration in Cuban waters in the Gulf of Mexico.

In foreign policy, the U.S. bid to isolate Cuba is losing ground, as foreign partners flock to Havana and urge Washington to normalize relations with Cuba. "Cuba's international position has never been more solid," says Carlos Alzugaray Treto, a former Cuban ambassador and a leading analyst. A range of Cuba watchers in the United States comes to a similar conclusion. "In general, they are well positioned internationally and internally to stay in power a good while more," says Daniel Erikson, a researcher at the Inter-American Dialogue and author of The Cuba Wars.

Cuba aims to diversify its sources of foreign support and its economic ties, despite its current reliance on subsidized Venezuelan oil, worth more than $3 billion last year. Cuban officials no doubt are factoring in the possibility that Venezuelan largess might someday vanish, and their searing experience with the collapse of their Soviet patron focuses their minds. "We realized we couldn't be, anymore, dependent on any one country or group of countries," says Vidal.

Cuba, of course, remains close to its primary benefactor, Hugo Chávez of Venezuela, and traditional friends like Russia and China. But Canada remains a key investor and source of tourists, as does the European Union, which has resumed normal relations with Havana. Most extraordinary is the outpouring of Latin American opposition to the U.S. embargo, in part a reaction to Bush's intense pressure. Brazil, South America's rising power, proclaims a desire to be Cuba's principal partner, and Obama's choice on Cuba is now being seen in the region as a barometer of just how much of the Bush legacy Washington is willing to abandon in reaching out to Latin America.

Paradoxically, the U.S. attempt to isolate Cuba has given it a higher international profile than it would attract otherwise. Latin American officials say that America's policy stiffens Cuban resolve to shun political reform and encourages their governments to embrace the Castro regime despite misgivings about its authoritarian ways.

Cuba has also been rewiring its economic circuits to bypass the United States. The result: U.S. leverage keeps declining. "Ten years ago, they needed the U.S.," says Kirby Jones, a Maryland-based consultant on Cuban business who started going to the island in 1974. "Now, with everybody moving in, they need the U.S. less and less."

On domestic economic matters, the Cubans also are moving, if cautiously, to strengthen their position. The weaknesses remain obvious: inadequate food supplies, shoddy, crowded housing, the aging Chevys and Studebakers still on the roads, the loathed dual-currency system. The signal achievements of the revolution—free and universal healthcare and education—remain, though they face new strains. In one corner food mart, a 66-year-old woman examines a blackboard listing the rationed staples and pronounces the scene "the same" as it was 20 years ago, when she first shopped there. A standard Cuban salary is 418 nonconvertible pesos (less than $20) a month. One day of such wages buys a pound of pork, and nothing else. Even Raúl Castro has conceded that Cubans cannot make do on such wages alone.

At a better-stocked supermarket that takes only convertible currency, Linnet Pérez explains the strategy: "Everybody tries to get hard currency." The Cubans pursue convertible pesos through remittances from relatives, employment in tourism, selling small services, and, of course, the black market. In Cuba, a bartender mixing mojitos for foreigners nets an income many times that of a physician.