NEW YORK (CNNMoney) -- The United States is planning to ease trade restrictions on Cuba. It is a major step that could lead to finally ending the Cold War era embargo, a tasty prospect for business in both countries.
The expected announcement is part of a new deal worked out by the Obama administration to have Cuba release American prisoner there, Alan Gross.
Trade has been frozen between both countries for half a century now. Americans want Cuban cigars, rum and clothing—but can’t get them. Cubans love American cars—but they’re still driving Chevys made in the 1950s.
The current embargo is expensive too. Every year, the U.S. economy loses out on $1.2 billion in missed sales, according to the U.S. Chamber of Commerce. The Cuban government says it misses out on $685 million each year because of the embargo.
Shortly after Fidel Castro’s armed revolutionaries deposed the Batista regime in 1959, the United States placed economic sanctions on Cuba—blocking exports since 1960. These trade restrictions only got tighter in 1962.
Diplomatic relations have remained frigid since. The Cuban people suffer because of lack of trade. And the embargo only tightens Castro family’s dictatorial control of the island, because it severely limits Cubans’ access to American music, movies, books and culture. All they get instead is communist propaganda.
Warming U.S. relations with Cuba are also a sign of changing political sentiments. The first generation of Cuban refugees, who typically fled to Miami in the 1960s, are vehemently opposed to U.S. trade with Cuba. Their reasoning: The Cuban government controls the economy, so it will benefit and grow even more powerful.
But second- and third-generation Cuban-Americans tend to take a more liberal stance. They support increased trade, under the assumption that more exposure to American culture will inspire free thinking and fuels dissent.
However, President Obama can’t lift all trade restrictions himself. Only Congress can formally overturn the embargo. In the meantime, the White House has some authorities to liberalize trade and travel to the island.
For instance, the Obama administration plans to permit great American travel to the island. It’s unclear how easy it will be for Americans to travel there, though, as tourism will still not be permitted.
CNN’s Elise Labott contributed to this story.
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