Western Union cuts remittance delivery in Cuba and waits for Joe Biden

After 21 years of uninterrupted service in Cuba,Western Union company concludes this Monday its remittance delivery operations to recipients on the island, putting an end to a business of 2.8 million unique transfers and about $1.5 billion annually from the United States.

At least for the next two months, the measure imposed by the Office of Foreign Assets Control (OFAC) of the Treasury Department will prevent Western Union from processing remittances in Cuba through the state financial company FINCIMEX, with which it had a current contract. since 1999.

The sanction of the Donald Trump administration against FINCIMEX, attached to CIMEX and under the control of the GAESA military,will officially come into force on November 27, the so-called Black Friday in the United States due to the exuberant start of Christmas shopping, but which will be very dark for Cubans for very different reasons.

The leading global payments company, responsible for processing the bulk of the $3.5 billion that is estimated to arrive annually in Cuba, will close this Monday its 402 money delivery points in the country's 168 municipalities, leaving a mystery about the possible reestablishment. of their services in the immediate term.

Everything will depend on President-elect Joe Biden taking the reins of the White House and immediately fulfilling his campaign promises to restore remittance services through Western Union to Cuba. without limit on quantity and frequency of shipments.

A source close to the team created by Biden for the transition of powers toldCyberCuba that it will be a priority to restore remittance and travel services to Cuba at the levels prior to the restrictions imposed by the Trump administration in 2019.

"It's a decision for the first 100 days of his term," said the source, who asked not to be identified.

In any case, while the possible reversal is being implemented in the Treasury Department due to an executive order, Cubans will have to have alternative ways to send money to their relatives from the United States, mostly through travel agencies and calls. "mules", which have begun to reorganize their operational channels since the reopening of flights to Havana, on November 15.

The State Department has recently insisted that US authorities are working as hard as possible to protect the Cuban people in these circumstances, and ensure that remittances continue to flow to the island, but without the control of military forces.

Asked about non-military ways to process remittances, Mara Tekach, coordinator of the Office of Cuban Affairs at the State Department, declined to offer details, but said there had been "negotiations in progress". The official also stated that there are non-military entities that are sending remittances and "the regime knows how to send them."

The Cuban government blamed Washington entirely for the closure of remittance shipments to Cuba.

"As part of that hostility raised for more than six decades and increased with almost 200 measures by the current administration, today, at 6:00 p.m., for the sole and exclusive responsibility of the United States Government, the payment of remittances from that nation to Cuba through Western Union," said aofficial newspaper articleGranma.

FINCIMEX recalled that remittances were paid in dollars in Cuba until 2010 and from that year onwards Western Union received a license from OFAC to be able to pay in CUC, the legal currency in Cuba, which supposedly "increased the operational flow." sustained to this day."

In any case, Western Union's relationship with FINCIMEX or other firms linked to the Cuban state and military conglomerate will depend on a decision pending in a federal court regardinga lawsuit filed by the firm Exxon Mobil under the Helms-Burton Act. A verdict by Judge Amit Mehta on whether to dismiss the litigation is scheduled for December 14.

Another key issue that will determine the way in which remittances are delivered from now on will be the imminent monetary unification of the country, which could occur this December 1. The government has not yet made the official announcement of the procedure, which will put the CUC out of circulation.

Some figures on the now canceled remittance transactions to Cuba by Western Union,compiled by the US-Cuba Economic and Commercial Council (USCTEC), based in New York, can give the dimension of the impact of this measure on the citizens of the island. The data was gathered from various sources, including Western Union and the SchoolofFlorida International University (FIU) Public Affairs:

Operations and monetary amounts:

Single monthly transfers.. 240,000

Tunique transfers per year... 2,880,000

Average value of annual transactions... $864 million dollars

Average value of monthly transactions... $72 million

Average value of daily transactions... $2.4 million

USTEC estimate of annual shipments by WU... Between $900 and $1.5 billion

Total annual flow from the US to Cuba... Between $2,000 and $4,000 million

Main states in the United States from which money is sent to Cuba:

1. Florida

2. Texas

3. New Jersey

4. Nevada

5. New York

6. California

7. Kentucky

8. Nebraska

9. Arizona

10. Georgia

Main receiving provinces and percentage of formal remittances received in Cuba:

Mugwort- 6%.

Camagüey- 6%.

Ciego de Avila- 7%

Cienfuegos- 4%

Granma- 3%

Guantánamo- 3%.

Holguin- 6%

Isle of Youth- 1%

Havana- 24%

Las Tunas- 3%

Matanzas- 7%

Mayabeque- 4%

Pinar del Río- 6%

Holy Ghost - 4%

Santiago de Cuba- 7%

Villa Clara- 7%

Location of Western Union branches in Cuba:

Artemis- 26

Camagüey- 25

Ciego de Avila- 29

Cienfuegos- 17

Granma- 13

Guantanamo- 14

Holguin- 23

Isle of Youth- 5

Havana- 96

Las Tunas- 14

Matanzas- 29

Mayabeque- 18

Pinar del Río- 26

Holy Spirit - 16

Santiago de Cuba- 27

Villa Clara- 34

Demographics:

• 48% of all Cuban-American families send remittances to Cuba.

• Cuban Americans ages 40 to 59 are the most likely to send remittances to family in Cuba.

• Approximately 70% of Cubans living in South Florida have relatives living in Cuba. 84% of those who emigrated since 1995 left relatives in Cuba.

Reasons given by Cuban Americans for sending money to Cuba:

• Economy and health care

• food

• Rent and other family expenses

• Support for micro and small businesses