Shipping giants CMA CGM and Hapag-Lloyd have suspended all bookings to and from Cuba until further notice. The move is in response to a US executive order issued on May 1, which has been criticized for its potential to exacerbate the economic crisis on the island.
The temporary suspension of new orders by these two companies could jeopardize as much as 60% of Cuba's shipping traffic by volume, according to sources with direct knowledge of the situation. This would be a significant blow to a country already struggling due to a US oil blockade that has severely limited its fuel supply.
CMA CGM has decided to suspend its bookings to or from Cuba until further notice, citing compliance risks associated with the US executive order. The company stated it is closely monitoring the situation and will adapt its operations in compliance with applicable regulations.
Hapag-Lloyd has also suspended Cuban orders due to compliance risks, according to a spokesman. This move could have significant implications for global shipping, particularly for goods shipped from China.
The Trump executive order on May 1 broadened existing US sanctions on commerce with Cuba to include certain sectors of the economy. Shipping companies are concerned about being linked to Gaesa, a business conglomerate tied to Cuba's military that has been heavily sanctioned by the United States.
Shipping of goods from China would be most impacted by the suspension, followed by Northern Europe and the Mediterranean. However, all global shipping to Cuba would be affected due to the new restrictions.
The Cuban government did not immediately respond to a request for comment on the suspensions. The move is likely to have devastating effects on Cuban imports, which are critical to keeping shelves stocked with provisions in a country already struggling with shortages and rationing.
Several options are being considered by Hapag-Lloyd and CMA CGM, including permanently halting shipping to Cuba or striking a deal with the US administration that would allow them to continue shipping only to Cuba's private sector. This latter option could give private business in Cuba an advantage over the state sector.
The suspension of shipping services by these two major companies highlights the growing tensions between the US and Cuba, as well as the impact of US sanctions on global trade. The move is likely to have far-reaching consequences for the global economy and the already struggling Cuban people.
The suspension of shipping services by two major companies could have severe implications for the already struggling Cuban economy.
