Reinvigorating U.S. people to people travel to
Cuba, adopting Viet Nam’s market model.
By John
McAuliff, Fund for Reconciliation and Development
Edited and
expanded from oral presentation at Programa de la XXIII Serie de conversaciones
Cuba en la política exterior de EE.UU.: El Regreso de Trump: Impacto presente y
futuro para Cuba. Centro
de Investigaciones de Politica Internacional (CIPI) December 18, 2025
(Thanks to Amb Cabanas who contributed to and enjoyed the
most positive moments of bilateral relations in decades, before or since.)
Everyone is aware of the very difficult situation for
tourism in Cuba.[1] The number of foreign visitors declined from
4.7 million in the peak year of 2018 to 2.2 million in 2024. 2025 is expected to be worse. While competitors in the Caribbean recovered
from the covid shock, Cuba’s market has not.
A significant cause is harsher application of the US
embargo. While there are still legal
categories permitting American travelers, large scale commercial movement is
impossible as long as cruises and use of State owned hotels is banned. That was a maximum pressure policy initiated
by the first Trump administration and not corrected by Biden.
The absurd listing of Cuba as a state sponsor of terrorism discourages
visitors from Europe who lose their ESTA visa waiver to enter the US for ten
years if they travel to Cuba.
The objective conditions in Cuba of power failures, limits
on food and debilitating mosquito borne diseases have also had a depressing
effect on conventional holiday tourism. The harsh treatment of both moderate and
extremist protestors in 2021 and conflicts between cultural dissidents and
authorities also diminish enthusiasm for Cuba as a destination. The same thing happened with China for two to
three years after Tiananmen Square
Cuba is making efforts to reverse the trend. A significant step is that foreign companies
will be able to lease as well as manage hotels.
In theory, they will have more
normal corporate authority to directly hire staff and to invest in improved
facilities. A conversation with a staff
member of Sol Melia suggests the major chains will be cautious and see how the
new system works on one or two test cases.
I am approaching this problem on both a macro and micro
level.
A.
Macro
Based on my decades long experience with Viet Nam, it is worth
considering what the impact would be on travel if Cuba took bold experimental steps
towards a market economy in only this sector.
When I first began organizing trips for professors and other
professionals in the mid 1980s, Viet Nam like Cuba treated travel as a state
monopoly. Vietnam Tourism organized all group
tours and owned and controlled all the hotels, not even allowing management by
foreign companies. The first signs of
change were private mini hotels on the fringes of Ha Noi. The doi moi market reforms in 1986 led to
legal and administrative changes that allowed foreigners, both Asian and
western, as well as Vietnamese investors, to build and own hotels. Large international companies created luxury
branded properties. Vietnamese investors
competed in this market and dominated smaller scale two or three star offerings
for backpackers, overseas nationals and other budget conscious travelers.
This graph created by Chat GP illustrates the dramatic change
in revenue share between the state and private sector in less than twenty years. Notable is that domestic private has a greater
value share than foreign ownership in the initial and later stages
The number of foreign tourists coming to Viet Nam. Data not available before 1995.
In current dollars, the value of international tourism,
marked by circles, and percent of national GDP, marked by squares, until COVID
Vietnamese entrepreneurs created travel agencies, tour
operators and specialized services supplemented by foreigners with niche
businesses like SCUBA shops and tours. The
Vietnamese Union of Friendship Organizations, the counterpart of ICAP, still organizes
tour programs that focus on friendship and many kinds of long term institutional
cooperation. US veterans of the American
war and of the peace movement are an important although diminishing special
audience.
The growth of international arrivals in Viet Nam demonstrates
the roaring success of a free market methodology from 250,000 in 1990 to 19.1
million by November of this year. (Note that Viet Nam has ten times the
population of Cuba so the ratio of visitors is less.)
If Cuba chose to introduce a similar open market system for
the travel sector, it could attract substantial foreign investment, management
and training skills, and a growing number of tourists. US companies excluded by the embargo would
complain more strongly to our government about long term competitive disadvantage
that will become more serious than when the only benefit for European companies
is management contracts. If Cuba sold
rather that leased selected hotels to trusted European partners, under current US
law and regulations they could become available for American tour groups and
independent travelers.
B.
Micro
Turning to the micro level, there is a small step that has
been officially rejected[2],
but can be taken easily and quickly, the licensing of tour guides as cuenta
propistas and of microenterprises in the travel sector. There is already a
gray market of guides who operate privately, many of whom formerly worked for
state companies. In 2021 an informal
association of guides made a written proposal to the Ministries of Tourism and
Labor that was rejected.[3] Symptomatically all but two members of the
original organizing committee now live abroad, a loss of badly needed
entrepreneurial talent and energy.
If cuenta propista guides and microenterprise travel
companies were legally recognized, it could have a significant impact on US visitors
organized by independent travel agencies and home based agents, about 15% of
the US holiday travel industry. Their
small scale does not easily fit with Cuba’s state companies, but their
cumulative impact for the country’s economy can be significant. Legal status for their Cuban counterparts and
a channel to transfer pre-payments are essential requirements for serious business. The ability to develop mutually trusted
business relationships that match the agendas and styles of senders and
receivers is an inducement for additional visitors and repeat trips. Direct company to company collaboration between
Americans and Cubans will generate practical ways to overcome current objective
hardships and will increase tax revenue.
Private tour guides became active in Viet Nam from the late
1980s. In 2001 a legal licensing mechanism was adopted
requiring educational qualifications and tourism training that currently
registers 26,309 guides for international visitors.
C.
Changing bilateral parameters
Finally, I want to address the policy problem that constrains
a large economic impact of US tourists. Attention should be given to the unusual character
of the Trump Administration. The first
half of Trump One witnessed little change in the Obama policies on travel. It was only when John Bolton became National
Security Adviser (April 2018 to September 2019) that his long animus to the
Cuban revolution combined with the political agenda of Senator Marco Rubio and
Mauricio Claver-Carone to devastate travel through maximum pressure. Cruises were forbidden so abruptly on June 5,
2019 that ships had to be rerouted.
Trump now despises and distrusts Bolton and is seeking revenge with controversial
criminal indictments. It should also not
be forgotten that before he became a candidate for President Trump sent an
exploratory team to Cuba that had very positive conversations about golf
courses and resorts.
If anyone could exercise unilateral power to end the
embargo, it is Donald Trump. Robert Muse
outlined the legal argument in 2020.[4] Marco Rubio as an ambitious and opportunist
Secretary of State who hopes to succeed Trump, could not oppose him. An inducement to this transactional
President, would be to allow the Trump Corporation to lease or purchase Cuba’s new
mega hotel on La Rampa. It would
discomfit most of your American friends and many Cubans to see the name Trump
on the top of the tallest building in Havana, but it could be only a temporary
burden.
I want to make another Viet Nam comparison. Just
before we went to Viet Nam to celebrate the 50th anniversary
of peace and reunification, Damien Cave, who also has a history covering Cuba,
wrote a long article about a $1.5 billion dollar Trump golf resort to be built
near Ha Noi.[5] Many Vietnamese were upset because the
project ignored normal approval procedures, including environment restrictions,
and because it will replace valuable privately owned farmland. But from the viewpoint of government leaders,
good will from the all transactional Trump could help with upcoming high
priority tariff negotiations.
An even greater and more controversial inducement could
involve Venezuela. President Trump does not want on his record
thousands of civilian deaths and endless war entailed by regime change. However he needs a symbolic victory over President Maduro
given how much he has committed US forces and prestige. From a Venezuelan perspective, what is more
important, the titular position of Maduro whose electoral victory is doubted by
significant friends of Cuba or the preservation of peace and of a sovereign functioning
government? If Cuba used its historic
ties with Venezuela’s government and military to help find a transitional diplomatic
solution reflecting current realities, it would be reasonable for it to insist
on as significant a change in US policy on Cuba, i.e. the end of the embargo.
Additional resources
"Travel: Symbol of and Vehicle for Change"
by John McAuliff
Edited Spanish version presented
to Congreso de Pensamiento, Holguin, Cuba 10/23/19 (revised and updated from talk presented at
XVI Edicion de la Serie de Conversaciones Cuba en la Politica Exterior de los
Estados Unidos de America del 13 - 15 de diciembre de 2017 Centro de Investigaciones de Politica Internacional (CIPI)
Instituto Superior de Relaciones
Internacionales (ISRI)
“People to People Diplomacy: A step, not a solution” Presented at Ultimo Jueves panel
sponsored by Revista Temas, Havana, July 18, 2019 https://cubapeopletopeople.blogspot.com/2019/09/people-to-people-diplomacy-diplomacia.html
Wikipedia Summary of Current Situation of Tourism in Viet
Nam https://en.wikipedia.org/wiki/Tourism_in_Vietnam
“Tourism & Economic Development in Vietnam” by
Bee Chin NG School of Social Science
Institution for Asian Studies The University of Birmingham, June 2008 https://etheses.bham.ac.uk/id/eprint/1783/1/Ng08MPhil.pdf
“Tourism development in Vietnam: New strategy for a
sustainable pathway” https://www.researchgate.net/publication/344416150_Tourism_development_in_Vietnam_New_strategy_for_a_sustainable_pathway
“From Deadly Enemies to Comprehensive Strategic Partners:
The Twenty Year Transformation of US Viet Nam Relations, Potential Implications
for US-Cuba Relations” by John
McAuliff Programa del evento XXI Edición de la Serie de Conversaciones “Cuba en
la Política Exterior de Estados Unidos de América”. El Centro de Investigaciones de Política Internacional (CIPI) con el
coauspicio del Instituto Superior de Relaciones Internacionales (ISRI) Hotel
Nacional, Havana, December 17-19, 2024 https://vnpeacecomm.blogspot.com/2024/12/the-path-to-us-viet-nam-normalization.html
“Reconciliation Between Peace and Normalization,
1975-1995” Prepared for US
Institute of Peace Dialogue on War Legacies and Peace, October 13, 2022 by John McAuliff https://vnpeacecomm.blogspot.com/2022/10/mcauliff-paper-for-usip-on.html
[1] “Cuban
tourism industry flounders as sunseekers look elsewhere” By Marc Frank February 18, 2022 https://www.reuters.com/world/americas/cuban-tourism-industry-flounders-sunseekers-look-elsewhere-2022-02-18/
[2]
Cuba approves long-sought legal status for private businesses
By Marc Frank
June 2, 2021
“Resolution 132/2021, published in the extraordinary
Gaceta Oficial 46, indicates that national travel agencies are the only ones
authorized to carry out procedures such as the issuance, reception and service
of tourists, the representation of foreign tour operators, and the design and
marketing of tourist packages.”
[4] “The
president has the constitutional power to unilaterally terminate the embargo on
Cuba”
Robert L. Muse
| October 8, 2020 https://cubapeopletopeople.blogspot.com/2022/02/presidential-power-to-end-embargo.html
[5] "Why
Vietnam Ignored Its Own Laws to Fast-Track a Trump Family Golf Complex," by
Damien Cave, May 25, 2025
https://www.nytimes.com/2025/05/25/world/asia/trump-vietnam-golf-project.html?unlocked_article_code=1.-k8.McQG.TdUN0fE3dGva&smid=url-share
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