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Biden and Merkel will talk China strategy; Cuban economic crisis
Ian Bremmer shares his insights on global politics this week from Washington, DC, with a look at the upcoming Biden/Merkel meeting, Haiti in crisis, and the ongoing protests in Cuba.
Biden is hosting Angela Merkel in Washington this week. What's on the agenda?
Most important is going to be China. That's not what the headlines are right now. They're all talking Nord Stream and cybersecurity and all that. But the reality is Biden wants to coordinate China policy with his top allies. He's had a lot of success with Japan. He's had success with South Korea. Those are the first two leaders to have been invited to Washington. He's probably going to have some success with Angela Merkel as well, because there is increasingly backlash against Xi Jinping and his efforts to consolidate a Chinese model, vaccine nationalism, lack of transparency on origins of the crisis, and all this kind of stuff. Technology hits, not allowing companies to IPO abroad. The Germans are angry too. And I think that is going to be the top issue they discuss.
A week after the assassination of Haiti's president. What's happening there?
Country is in complete disarray. The military basically is running the place by default right now, but they don't have control. Gangs are running all over the country. And the Haitian government, such as it is, is asking for international intervention, peacekeepers from the United States and others. The good news is that if the US were to provide some support, pretty much every other country in the Western Hemisphere would support it and probably many would participate. So it doesn't have to be American intervention by itself. Clearly, they also need humanitarian support and jabs. There have been no vaccinations on Haiti so far. Real problem for that country.
What sparked Cuba's recent protests? The biggest in decades.
Well, it's a combination of the biggest economic and healthcare crisis in decades and the government that's been really badly run under dictatorship, and stepped-up US sanctions. In the last year, there's been no tourism to Cuba. They haven't had money to put into actually developing the sugar crop, which has meant that that's underperformed too. They don't have any money. Venezuela's not providing support like they used to because they've collapsed. The Russians don't really care. So you've got thousands of people demonstrating around the country, and it is possible that the government will fall. They have enough military capacity to shut down these demonstrations, but they want to be careful about not killing a bunch of people in the streets because that could really blow up in their faces. So worth watching carefully.
People hold Cuba's national flag during protests against and in support of the government in Havana.
A rare revolt in Cuba
On Sunday afternoon, thousands of Cubans did something remarkable in a police state: take to the streets in the biggest protest against the government in almost 30 years. Yet only dozens were arrested the next day. They are all risking lengthy jail terms to demand access to scarce food, medicine, and COVID vaccines.
How did we get here, and what might come next?
From COVID containment to economic tragedy. Cuba avoided the first wave of the pandemic by closing its borders and implementing tough restrictions. In the early stages, Havana was even sending doctors to help friendly nations in need. But stopping the virus came with a price: shutting itself off from the world killed the tourist industry, the main source of foreign cash for Cuba's state-run economy. That in turn hurt sugar, Cuba's top export, which last May had its worst harvest in over a century because growers can't afford to buy enough fertilizer and machinery.
Throughout 2020, the economic crisis was further aggravated by tougher US sanctions under the Trump administration — which made it virtually impossible for Cuban Americans to send remittances back home — as well as dwindling oil supplies from political bedfellow Venezuela. When Cuba's food rationing system collapsed a year ago, the regime had no choice but to bring back 1990s-era "dollar stores" (where foreign residents and locals with access to dollars can buy goods in foreign currency instead of worthless pesos) to pay for much-needed imports.
Things have since gone from bad to worse. GDP declined by 11 percent in 2020, and overall scarcity could make prices shoot up by as much as 900 percent this year. And COVID is now raging: authorities on Sunday reported almost 7,000 new daily infections and 47 deaths, the highest figures to date. (Cuba claims to have developed two highly effective homegrown COVID vaccines, but the vaccination campaign is losing steam because it's running out of needles.)
Tough choice for Havana. The latest protests are the most significant public display of discontent with the regime since the 1994 Maleconazo, when Cubans rose up to complain about shortages after Soviet subsidies dried up following the collapse of the USSR. Back then, all it took was a riveting speech by the charismatic Fidel Castro to end the demonstrations. But Fidel died in 2016, and last April his younger brother Raúl stepped down as head of the ruling Communist Party.
With both Castros gone, it's hard to predict how Havana will respond. Although Miguel Díaz-Canel is the president and leader of the party, it's unclear whether the powerful military would obey him if he orders a Tiananmen-style violent crackdown because he's not a Castro. On the other hand, caving to the protesters without putting up a fight would make Díaz-Canel look weak in the eyes of the army and the people, especially older Cubans who support the regime.
Miami and Washington are watching closely. Cuban Americans — most of them rabid anti-communists — are immensely influential in US politics through Florida, a known swing state which former president Trump won in 2020 by an even larger margin than in 2016. Trump courted the Cuban American vote there by designating Cuba a state sponsor of terror right before the election, while Biden oversaw Cuba's removal from the same list when he was Obama's VP.
Biden is likely to face immense pressure by Republicans, (most of) his own party, and Cuban Americans themselves to get tough on the regime, perhaps by further tightening economic sanctions. But if he pushes Havana too hard, Biden risks thousands of Cubans getting on boats to Miami to flee the island's economic implosion — as they did in 1994. With migrant flows to the US southern border still high, in part because of more Cuban asylum seekers, the last thing the Biden administration wants is another immigration crisis.
Whatever happens in the coming days and weeks, Cuba's problems aren't going away. So far, the Cuban government has mostly shown restraint in dealing with the protesters, but it may change its tune if the rallies grow, as they probably will if tech-savvy young Cubans continue to mobilize on social media (despite frequent internet blackouts). What's more, the country's leaders find the protesters' demands reasonable — they just don't have money to pay for them right now. The regime is in survival mode, and needs time to weather the storm.
Protests in Cuba. How will the US respond?
Ian Bremmer's Quick Take:
Hi, everybody. Ian Bremmer here, kicking off your week. A little Quick Take. Thought I would talk about Cuba, not a country we talk about all that often. Communist state, Raúl Castro just stepped down, and the biggest demonstrations across the entire country in decades. Talking about absence of vaccines, problems in healthcare, but also anger at the poverty, the economic mismanagement, the reality of the lack of liberty of living in a communist regime.
The Trump administration had put pretty significant sanctions back on after Obama tried to loosen up. I expect that this is going to make Cuba a bigger issue for lots of folks in the United States that would like to see the back of this Cuban regime. The question is, how does the United States try to address it? Does it shut the Cubans down even harder, make the country pay economically for the fact that they are treating their people so badly or does it use this as an opportunity to open up? I'll tell you.
I've actually done a fair bit of work on issues of sanctions and countries around the world, because there are two types of political stability. You have countries that are stable because they're open like Canada or Germany or Japan, or even the United States. And then you have countries that are stable because they're closed like Saddam Hussein's Iraq. Or like Gaddafi's Libya, or like Kim Jong-un's North Korea. And of course, Raúl Castro's Cuba. And if you are a country that is stable because you're closed, you generally want to stay closed. And the reason for that is because if suddenly you get lots of capital and movement of people and ideas and trade between your closed country and open countries around the world, the people inside your country want more liberty. It is harder to maintain political control in that environment.
We see that going on in Belarus with President Lukashenko. We've seen it going on in Cuba. It's why when the United States tries to move towards openness with Cuba, the Cuban government itself, they want the money, but they resist the idea of lots of foreign direct investment coming into Cuba because the United States is so much bigger. This is the advantage that the Americans have. It's not like the United States versus China, where you bring the Chinese into the WTO, but they're so large they still have the ability to maintain significant controls over what their people see and do and experience. And increasingly with technological controls surveilling the entire population, they can consolidate communist control even though there is a level of state capitalism and private engagement in China.
In the case of Cuba, opening up the borders would mean a massive amount of trade overwhelming what the Cuban government could have influence over a massive amount of tourism and the engagement with the average Cuban citizen would be much greater. I would argue that the reason why the communist regime has persisted for 62 years has precisely because they've been allowed to maintain isolation supported by the United States because of that sanctions regime. Lots of reasons for it, lots of Cuban emigres that were so angry at the Castro regime that would not tolerate any level of opening up of those sanctions, but those people are largely gone now.
There's a lot of private sector folks in the United States that would love to have access purely not because they're interested in liberty, but just because they want to make money in Cuba. I would argue that if you were able to take advantage of the size and scale of the American economy, its investment capacity, its trade capacity, its demand for things like Cuban medical expertise and the doctors and nurses that could serve the American market, I mean even the old Cuban vintage cars that would all be repaired and suddenly sold in the American market. The impact that would have for the Cuban political system would be immense. And I would suspect that you'd have a much quicker move towards regime change from the grassroots of the Cuban people, as opposed to the failed efforts by the CIA and others historically that never seemed to go all that well for the United States.
Anyway, something to think about. Certainly, a debate we're going to have in a more direct way in the United States because thousands of Cuban citizens are taking their lives in their hands by demonstrating across the country this weekend. Hope everyone's doing well, and I'll talk to you all real soon.
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Xi Jinping expects China to be treated as equal of US
Ian Bremmer shares his perspective on global politics on World In 60 Seconds (aka Around the World in 180 Seconds) and discusses Xi Jinping's message to the US, Russia's buildup at the Ukraine border, and Cuba's new leader.
What did you make of Xi Jinping's message to the US at China's annual Boao Forum?
Well, he didn't mention the United States directly, but he basically said that we don't accept hegemonic powers, we don't accept people that are setting the rules for other countries. Basically, consistently Xi Jinping saying that the Chinese want to be treated as equals with the United States. They're going to be rule makers for themselves. The Chinese political and economic system, every bit as legitimate as that of the United States. This is going to be a real fight. The American perspective is that the relationship between the two is going to be very competitive, whether it's a happy competition or an unhealthy competition depends on the Chinese. Xi Jinping's perspective is the Americans are not treating the Chinese with due respect. And that's going to play out on security, it's going to play out in climate, on the economy. I mean, you name it.
Is Russia's increased troop presence at the Ukrainian border really only a military exercise?
No, nothing is ever only a military exercise when the Russians are engaging in this kind of territorial bluster. What they're saying is that they will not be cowed by the Americans. The Ukrainian government acting more independently than had been expected by Putin, putting sanctions under oligarchs that Putin likes and is close to, asking for a membership action plan from NATO. All of that is something that Putin wants to show that Biden doesn't have his back, he's angry at the Ukrainians, and the only way forward is the Minsk Process, and that means tens of thousands of troops. The Ukrainians are not going to provoke by engaging in conflict. I would be very surprised if the Russians actually engaged in any further intervention, actually went across the border. I suspect we'll see a climb down at the end of this two week period, as the Ministry of Defense in Russia said. But they have made it very clear to the Americans that this conflict is not getting resolved easily.
A Castro no longer leads Cuba. Who is the new leader and how will the country change?
The new leader is Miguel Díaz-Canel. He is the first non-Castro to run communist Cuba. This is half a century we're talking about. He's not a former military guy. He's mostly a technocrat, bureaucrat that focuses on the economy. That having been said, still communist Cuba and the United States is not engaging in policies of economic and political opening right now. I do think that's the way forward. I think that if the United States were to go back to the policies that we saw started under President Obama, where you engage in trade, the power asymmetry is so great that as the Cuban economy starts getting more influence and more dependence on American tourists and on remittances and on all of the things that the dominant American economy would provide, the pressure on the Cuban communist government to collapse would be very high. That's the way forward, but there's no political support for that right now. It's not high on the agenda for the Biden administration, so you don't expect it. But with Castro out, makes it easier for some of the members of Congress that have had challenges.