Canada, Brazil and Mexico all agree on one thing: U.S. policy makes no sense.

Few Canadian investors would deny that the U.S. embargo gives them a huge competitive advantage in Cuba. Even so, Canada says the United States must change course.

Peter Boehm, minister of political and public affairs at the Canadian Embassy in Washington, made his case along with embassy officials from Brazil, Mexico and Peru at a recent conference entitled "Cuba: What Next?" and sponsored by the Inter-American Dialogue.

"It's our view that a combination of official development assistance and an open relationship, not sanctions, will support movement towards greater political and economic reform," stated Boehm, Canada's former envoy to the Organization of American States. "The embargo is contrary to international law and hasn't been successful. [Only] globalization will spell the end of the Cuban experiment. The question is when."

Canada's official trade with Cuba dates from 1910, when Ottawa opened a commercial office in Havana. Two years later, the Royal Bank of Canada inaugurated its Havana branch, the same year it opened its first branch in Toronto. Full diplomatic relations were established in 1945 and have remained intact ever since.

"This unbroken relationship has entered Canadian folklore as a symbol of how we can distinguish our foreign policy from that of the United States," says Boehm, estimating annual bilateral trade at around $435 million.

In 2001, Canada--Cuba's No. 3 trading partner after Spain and Venezuela--exported $254.8 million worth of goods to Cuba, up from $223.9 million the year before. The top exports by value were wheat ($15.6 million); peas ($13.0 million); frozen chicken parts ($11.6 million); auto parts ($9.3 million) and sulfur ($8 million). And in the first three months of 2002, exports of the 25 leading product categories rose by an astonishing 95%. Canadian imports from Cuba came to nearly $180 million in 2001.

Likewise, Canada is the 2nd-largest investor in Cuba after Spain, and Toronto-based Sherritt International is the largest single foreign investor, with interests in agribusiness, energy, hotels, mining and mobile telephony.

Because of the Helms-Burton Act--under which Sherritt officials are barred from receiving U.S. visas--Canada's Department of Foreign Affairs and International Trade is unwilling to provide the names of Canadian companies that invest or do business in Cuba.

"Most Canadian companies prefer to keep a low profile, and I have to respect that," says Cameron Young, an attorney from Montreal whose Havana-based consulting firm, Berger Young & Associates Ltd., advises foreign companies doing business in Cuba.

"The Canadians have always been favorably received by the Cuban government," Young told CubaNews in a telephone interview from Havana. "I can't say there's a significant number of new projects going on right now, but generally the position of Canadians as investors here is very strong."

Ottawa has already expressed its outrage over the case of James Sabzali, a 42-year-old Canadian businessman living in Pennsylvania.

In early April, a Philadelphia jury found Sabzali guilty of violating the 1917 Trading With the Enemy Act. Sabzali's crime: arranging the sale of $2.1 million in water purification chemicals to Cuba.

Meanwhile, says Boehm, Ottawa's focus is not only on promoting investment but also providing development assistance. To that end, the Canadian International Development Agency is the largest single bilateral donor to Cuba, having donated over $30 million a year in official development assistance.

"We resumed our aid program in 1994, after having suspended it in the 1970s because of Cuba's Angolan adventures," he said. "Since 1994, we have found the Cuban government to be a very cost-effective partner. We have programs with the Ministry of Finance, the Ministry of Economy and Planning and the Central Bank, training middle managers who will become senior managers when the transition occurs. That's to ensure that when the landing comes, it'll be a soft landing."

Besides development assistance, Canada contributes to the Cuban economy by making it easy for tourists to visit the Caribbean island. Last year, Cuba--now the No. 5 destination worldwide for Canadian tourists--received 350,000 Canadian visitors, up from 144,000 in 1995. Nearly all of them arrive on direct flights from Toronto or Montreal.

In addition, said Boehm, "many voluntary organizations have ties with Cuba, ranging from solidarity groups on the left" to apolitical church groups and municipalities."

In April 1998, Jean Chretien became the first Canadian prime minister ever to visit Cuba--an event Canada thought would push Castro to open up a little. "But we failed," says Boehm. "The treatment that seems to be reserved for Mexico this year, we received last year. We realize what this is all about."

Even so, says the diplomat, "criticizing the U.S. economic embargo doesn't mean uncritical acceptance of the status quo. Our job is to encourage Cuba towards a democratic system. We remain concerned about Cuba's systematic violation of human rights. By engaging in constructive policies, we think we've accomplished a little bit."

Asked by a skeptical member of the audience how he could call Canada's Cuba policy a success, Boehm retorted: "It's certainly been successful for our companies."

RELATED ARTICLE: Brazil's Barbosa: isolating Cuba is not the answer.

Brazil, Latin America's largest and most populous nation, re-established diplomatic ties with Cuba in 1987, soon after the military dictatorship in Brasilia was overthrown and replaced by a democratic government.

Mainly due to long distances and weak cultural links, Brazilians rarely think about Cuba, and few travel there as tourists.

Nevertheless, the two countries do lots of business, and at least three Brazilian entites have formed joint ventures with the Cuban government: Souza Cruz S.A. (cigarette production), Busscar (bus assembly) and Petrobras (offshore oil exploration).

Rubens Barbosa, Brazil's ambassador to the United States, says his country's bilateral trade comes to $130 million a year. Of that, Brazilian exports to Cuba--largely machinery, vehicles and spare parts--accounts for $120 million; the remaining $10 million consists of Cuban shipments of pharmaceuticals and vaccines to Brazil.

"Since the beginning, our idea has been to bring Cuba back into our hemisphere," he said. "We should not exclude Cuba from anything. Isolation is counterproductive, and we think it hinders any chance of change in Cuba. We see gradual changes in Cuban society, and we think this is an internal affair."

Barbosa, 63, played a key role in the formation of the Mercosur trade bloc in the late 1980s, and he served as Brazil's first ambassador to ALADI, the Latin American Integration Association. He was also Brazil's top diplomat in Great Britain from 1994 to June 1999, when President Fernando Henrique Cardoso transferred him to Washington.

Barbosa says the U.S. trade embargo against Cuba is "outmoded and ineffective," and insists that Cuba must be allowed back into the Organization of American States, from which it was suspended in 1962.

"One of the cornerstones of Brazilian foreign policy is non-intervention. We try not to interfere with the will of the people in any way," said Barbosa. "We've been consistently against the embargo and Helms-Burton, and have consistently abstained from UN resolutions on human rights. At the same time, the Cardoso administration has been vocal about returning Cuba to the OAS. We know there are political difficulties, but we think this would be the best way for all of us."

The fact that Cuba isn't a democracy shouldn't prevent it from rejoining the OAS, said the diplomat. After all, he pointed out, Brazil and many other countries endured years of dictatorship and yet were never expelled or suspended from the organization.

Carlos Rico, minister of political affairs at the Mexican Embassy in Washington, offers similar argument.

"Mexico is absolutely convinced that a policy of isolating Cuba will not bring the kinds of results we want," he said. "Our own solution is simple: let's be consistent and let the markets do their work."

According to Rico, the feud earlier this year between Castro and President Vicente Fox is an outgrowth of the "increased legitimacy of human rights as an object of international action" and not just talk.

Rico said that, as a result of Mexico's new willingness to look at its own human-rights abuses of the past, the country had no choice but to condemn Cuba's human-rights record--lest it appeared to be saying one thing and doing another.

Nevertheless, the diplomat pointed out, "the UN resolution recognizes the accomplishments of the Cuban revolution and its benefits for the people. It makes a clear reference to the negative impact of isolating Cuba. And we specifically stated that we have always opposed the embargo."

Likewise, Brazil's Barbosa complains that the Bush administration is rather hypocritical when it comes to Cuba.

"It's hard to accept that we treat a brother country differently than we treat China, Vietnam or other undemocratic countries," he said. "Brazil thinks this contradiction will have to be faced sooner than later."

--Larry Luxner