Log in
E-mail
Password
Remember
Forgot password ?
Become a member for free
Sign up
Sign up
Settings
Settings
Dynamic quotes 
OFFON

4-Traders Homepage  >  Equities  >  Nyse  >  Caterpillar    CAT

CATERPILLAR (CAT)
Mes dernières consult.
Most popular
  Report  
SummaryQuotesChartsNewsAnalysisCalendarCompanyFinancialsConsensusRevisions 
News SummaryMost relevantAll newsofficial PublicationsSector newsTweets

Blooming U.S. business interest in Cuba wilts under Trump

share with twitter share with LinkedIn share with facebook
share via e-mail
0
11/10/2017 | 04:46pm CEST
Tourists walk in Havana

HAVANA (Reuters) - Packed into a remote corner of a pavilion, just 13 U.S. companies took stands at Cuba's sprawling trade fair this year, in a sign of how firms' interest in doing business on the island has dwindled in the first year of Donald Trump’s presidency.

Last year, amid enthusiasm following a detente in relations agreed between former President Barack Obama and Cuban leader Raul Castro in 2014, 33 U.S. companies took stands at the fair, the premier event on Cuba's business calendar.

The mood was very different at this year's edition, which took place last week in Havana. While China brought a record company delegation, and more than 150 Spanish businesses packed into five pavilions, the handful of U.S. businessmen were downbeat.

"I've never seen it this deserted," said Jay Brickman, vice president of Florida-based shipping company Crowley Maritime Corp, who has been attending the fair for 15 years. "People have really gotten discouraged, and feel they maybe should be investing their time someplace else."

U.S. companies embraced Cuba in the wake of the detente, jostling for a foothold in an opening market of 11 million consumers.

Thanks to travel-related exemptions to the embargo, U.S. airlines restored regular flights. Starwood Hotels, a subsidiary of Marriott International Inc (>> Marriott International Inc), took over management of a Cuban hotel and cruise operators like Florida-based Carnival Cruise Line (>> Carnival Corp) included Cuba in their itineraries.

But worsening U.S. relations as well as growing awareness of the difficulty of doing business in Cuba put a dampener on that.

Trump in June ordered tighter trade and travel restrictions including a ban on business with the military, which controls vast swathes of the economy. The regulations were unveiled on Wednesday.

"This is a huge step backwards," said former U.S. Secretary of Commerce Carlos Gutierrez, the Cuban-born head of the U.S.-Cuba Business Council. "We had made so much progress."

An unfolding diplomatic crisis over allegations of attacks on U.S. diplomats in Havana is adding to the gloom.

Cuba Trade magazine, based in Miami, last month cut its issuance from monthly to bi-monthly, citing the deteriorating business environment under Trump. Several Cuba business conferences in the United States have also been canceled since June, including an agriculture conference in Chicago.

Following the Obama detente, U.S. farmers hoped for legislation allowing them to access credit for exports to Cuba. But Trump has made it clear he is not about to ease, let alone lift, the embargo.

"We need to get the diplomatic issue off the table first," said Louisiana Agriculture Commissioner Mike Strain, adding U.S. food exports to Cuba could total $1 billion if relations were normalized.

HARDER

Even before Trump took office, some of the interest fizzled as companies realized doing business in Cuba was hard with its red tape, shortage of hard currency, poor telecommunications and labor restrictions.

Online payments company PayPal Holdings Inc (>> PayPal Holdings) sent its chief executive in Obama's delegation on his historic visit to Cuba in March 2016. It had been interested in making its Xoom money transfer service available in Cuba but said operational challenges were too great.

"When we are able to deliver the speed, convenience and security our customers have come to expect from Xoom, we will launch in Cuba," a PayPal spokeswoman told Reuters.

Still, some companies made headway. After receiving all the necessary licenses under Obama, the Puerto Rican dealer for U.S. heavy equipment maker Caterpillar Inc (>> Caterpillar) last week agreed to open a distribution center in Cuba's Mariel special development zone.

Future deals with Mariel, which boasts tax and customs breaks, will not be possible, as it features on a list published Wednesday of 180 government entities that Americans are now banned from doing business with.

"The Mariel restriction particularly sticks out because it is the most dynamic and exciting opportunity in Cuba," said James Williams, president of lobby group Engage Cuba.

The diplomatic crisis has also complicated the logistics for U.S. businesses. The Trump administration in September expelled 15 Cuban diplomats, including all those dealing with U.S. businesses.

The following week, the chair of the port of Cleveland, Darrell McNair, traveled to Havana to sign an agreement with Cuba's port authority. He said the now-disbanded embassy commercial team had been instrumental in arranging his visit.

"Cutbacks obviously are going to slow things down," he said.

LONG-TERM PLAY

The tougher environment under Trump has separated the wheat from the chaff, some business consultants say.

"The serious players who understand the risks are staying the course," said Pedro Freyre, who heads the international practice at Miami-based law firm Akerman LLP.

Jeff Nelson said his firm Strategic Staffing Solutions, which provides companies with IT and other services, was prepared to put in the time laying the groundwork for business with Cuba given the potential of its educated workforce.

"Doing business in Cuba is a very long-term proposition," said Nelson, who has visited eight times in two years.

Some companies were pursuing deals behind closed doors so as to not lose capital with the Trump administration, consultants said. Many Obama-era exemptions to the embargo remain in place.

The publication of the new regulations at least provided clarity about what was allowed.

"Companies know where they stand now and there are definitely opportunities still," said Gutierrez. "Every day that goes by is just the missed opportunity where someone else is building a brand, someone else is building awareness among Cubans."

(Reporting by Sarah Marsh; Additional Reporting by Marc Frank in Havana and Anna Irrera and Alana Wise in New York; Editing by Daniel Flynn and James Dalgleish)

By Sarah Marsh

Stocks mentioned in the article
ChangeLast1st jan.
CARNIVAL CORP 1.60% 59.58 Delayed Quote.-11.72%
CATERPILLAR 1.52% 141.03 Delayed Quote.-12.37%
MARRIOTT INTERNATIONAL 2.01% 133.05 Delayed Quote.-3.64%
PAYPAL HOLDINGS -0.37% 88.31 Delayed Quote.20.32%
share with twitter share with LinkedIn share with facebook
share via e-mail
0
Latest news on CATERPILLAR
02:14pCATERPILLAR : UTE-CAT chosen for Northern-North Central projects by Sierra Const..
AQ
01:01pCATERPILLAR : Ex-Dividend Alert: Caterpillar Raised its Dividend By 10%; Will Tr..
AC
11:04aCATERPILLAR INC. : to Announce Second-Quarter 2018 Financial Results on July 30
AQ
10:13aCATERPILLAR : Repair and Recommissioning of 250kva Caterpillar Make Dg Set No.1 ..
AQ
03:20aCATERPILLAR : No bomb found at Caterpillar building KK
AQ
07/17CATERPILLAR : Taking a Compact Cat for a spin at Finning
AQ
07/17CATERPILLAR : Super Longreach Pontoon Amphibious Excavator
AQ
07/16CATERPILLAR : D6T Power Take Off Winch and Installation
AQ
07/16CATERPILLAR INC. : to Announce Second-Quarter 2018 Financial Results on July 30
PR
07/13CATERPILLAR : Supply of Replacement Parts for Caterpillar / Bulldozer
AQ
More news
News from SeekingAlpha
11:27aCaterpillar bearish 'death cross' appears 
07/17Manitowoc, Generac downgraded to Sell at Goldman 
07/16DIVIDEND GROWTH 50 : Income Up Nearly 10%, Led By Kinder Morgan (Seriously!) 
07/124 Upcoming Dividend Increases 
07/12Which Stocks Are Immune To Trade War? - Cramer's Mad Money (7/11/18) 
Financials ($)
Sales 2018 53 646 M
EBIT 2018 8 415 M
Net income 2018 6 043 M
Debt 2018 25 460 M
Yield 2018 2,26%
P/E ratio 2018 13,58
P/E ratio 2019 12,24
EV / Sales 2018 2,02x
EV / Sales 2019 1,83x
Capitalization 83 085 M
Chart CATERPILLAR
Duration : Period :
Caterpillar Technical Analysis Chart | CAT | US1491231015 | 4-Traders
Technical analysis trends CATERPILLAR
Short TermMid-TermLong Term
TrendsBearishBearishNeutral
Income Statement Evolution
Consensus
Sell
Buy
Mean consensus OUTPERFORM
Number of Analysts 26
Average target price 170 $
Spread / Average Target 23%
EPS Revisions
Managers
NameTitle
Donald James Umpleby Chief Executive Officer & Director
David L. Calhoun Independent Chairman
Joseph E. Creed Chief Financial Officer & Vice President
Thomas J. Bluth Chief Technology Officer & Vice President
Julie A. Lagacy Chief Information Officer & Vice President
Sector and Competitors
1st jan.Capitalization (M$)
CATERPILLAR-12.37%83 085
SANY HEAVY INDUSTRY-8.93%9 525
ZOOMLION HEAVY INDUSTRY SCI & TCH CO LTD--.--%4 355
DOOSAN BOBCAT INC--.--%2 724
GUANGXI LIUGONG MACHINERY CO., LTD.--.--%1 667
TADANO LTD.-28.20%1 564