Some Maryland Companies Set Sights on Cuba

What business opportunities are Maryland corporations exploring in other jurisdictions

Maryland and Cuba once had such close ties that, in 1922, a Maryland Senator described the island as “a suburb of Baltimore.” Baltimore-based companies doing business there included McCormick & Co. and the Baltimore Spice Co. A refinery on the waterfront, now Domino, processed sugar from the cane fields of Cuba. Baltimore was also the point of entry for Cuban pineapple shipments.

But that was all before Fidel Castro came to power and the Cold War and trade embargo began.

Now, with the U.S. and Cuba normalizing diplomatic relations, Maryland companies are once again looking to Cuba for business opportunities. Congress has not lifted the trade embargo, but companies are watching and waiting.

Bethesda-based Marriott & Ritz Carlton, which did not have a hotel in Cuba in their heyday, see the island as having great potential. Cuba has few hotels and most are not up to the standards of today’s affluent travelers.

Domino, whose Baltimore sugar refinery employs 485 workers, is now owned by an affiliate of the Fanjul Corp. The Fanjuls, four Cuban brothers who had to flee Cuba, saw their holdings there confiscated by the Castro regime. One of the brothers has said that he would be open to investing in Cuba again under certain conditions.

Despite the trade embargo, the U.S. exports between $300 million and $500 million in food, agricultural and medical supplies to Cuba under exemptions. Experts predict that the U.S. could export as much as $4.3 billion a year and import $5.8 billion from Cuba if trade relations were restored.

Without a lifting of the embargo, however, this remains a distant hope. Perdue Farms, Maryland’s largest food and agricultural company, exports soybeans and high-protein soybean meal to Cuba but does not foresee a dramatic rise in trade.

Harry K. Wells, president of McCormick & Co. in the 1970s, said his company “once did a very nice business” in Cuba and would be glad to do so again. In March 1978, a delegation from Baltimore traveled to Cuba to meet with government officials. According to news accounts, eleven Baltimore companies sent representatives, including officers from Atlantic Engine Power Co., Maryland Bolt and Nut, and Teledyne Energy Systems.

There remain serious obstacles to the normalization of trade, however. Cuban exiles have $7 billion in unsatisfied claims against Cuba. The Castro regime’s staunch commitment to state control of the economy creates practical problems for foreign corporations seeking to do business there.

If you are contemplating new business opportunities, whether in a state-run economy like Cuba, or in any new jurisdiction, it is important to have expert advice on laws, regulations, and local practices that may affect your bottom line. Longman & Van Grack ‘s team of experienced business lawyers at can help you anticipate and solve the problems of building a new business and finding new markets. Contact our corporate and business law attorneys today for a consultation by calling (301) 291-5027.