Obama, Raul Castro speak by phone before heading to Panama summit

PANAMA CITY — President Obama and Cuban President Raul Castro spoke by telephone Wednesday, only the second such call between leaders of the two nations in more than 50 years, as both prepared to leave their capitals for what is likely to be a face-to-face meeting here Saturday at the 35-nation Summit of the Americas.

The call was their first direct contact since a lengthy telephone conversation before their simultaneous Dec. 17 announcements that Havana and Washington would normalize relations. Their only previous contact was a handshake at Nelson Mandela’s funeral in South Africa.

U.S.-Cuba rapprochement has been the main focus of the hemispheric summit, held every three years, but never before with Cuba in attendance. Planning for an Obama-Castro meeting has been a slow diplomatic choreography since December, including three rounds of lower-level negotiations over the nuts and bolts of normalization.

Late Thursday, Secretary of State John F. Kerry met here for hours behind closed doors with his Cuban counterpart, Bruno Rodriguez, the highest-level direct contact to date between the two governments.

Obama arrived at the two-day summit Thursday from Jamaica, where he met with leaders of the 15-nation Caribbean community, whose members make up nearly half of the countries of the hemisphere and form a formidable block, in numbers if not in population and economic clout, at the wider meeting here.

As he contends with vexing problems at home and abroad, the summit is likely to be a high point for Obama, whose broad popularity in the Western Hemisphere has been enhanced by the Cuba agreement. This week, the State Department recommended to Obama that he remove Cuba from the U.S. list of state sponsors of terrorism. That move, which the president may announce at the summit, would lift the last major roadblock to reestablishment of formal diplomatic relations between the United States and Cuba.

[In Jamaica, Obama indicates that he will remove Cuba from terrorism list]

On Friday morning, Obama visited the Panama Canal, traveling by Marine One. The presidential helicopter landed at what was once Howard Air Force Base in the former U.S. Canal Zone, so the president could visit the Miraflores locks. A massive expansion of the waterway is underway and is expected to be completed next year. The widened canal will double the size of ships that can pass through the waterway, to the advantage of U.S. East Coast ports.

Earlier Friday, Obama and Panamanian President Juan Carlos Varela witnessed an agreement between Copa, the Panamanian national airline, and the CEOs of Boeing and General Electric for the purchase of $6.6 billion worth of new aircraft, the largest-ever commercial transaction between Panama and U.S. companies.

On Friday afternoon, the president will participate in a panel with leading international business and industry leaders, and meet with civil society representatives who have come from throughout the hemisphere. Their presence — including opposing pro- and anti-Castro Cuban groups — have given Panama City something of a circus atmosphere. The streets are clogged with jostling pedestrians pushed to the side by the frequent motorcades moving from one event to the other.

On Saturday, the leaders will gather for a series of summit meetings. It is there that heads of state, including Obama and Castro, are expected to break away for bilateral meetings.

U.S. relations with Venezuela has been a sideshow at the summit. Venezuelan President Nicolas Maduro, with signed citizen petitions in hand, has demanded that the Obama administration repeal sanctions imposed against seven officials in his government for corruption and human rights abuses. Maduro has gained some popular support after an Obama executive order declared Venezuela a “national security threat” to the United State.

Spanish-speaking U.S. officials are making frequent appearances on local television, to insist that they bear no ill will toward Venezuela. “We don’t see Venezuela as a threat to U.S. security, and we have no intention of trying to change the form of government there,” State Department spokesmen Justin Thomas told a Panamanian television interviewer Friday morning. But at the same time, he said, “we have no plans to repeal” the sanctions order, which was mandated by Congress.

Cuba, Venezuela’s main backer in the hemisphere, will have to walk a thin line between supporting Maduro’s challenge and keeping Castro’s plans for U.S. normalization on track.

The historic participation by the communist island has made for some extraordinary — but also ugly — scenes.

In one part of town Thursday, at a forum for the CEOs of major U.S. companies such as Facebook, Coca-Cola and Boeing, a Cuban trade official invited America's corporate leaders to visit the island, telling them his country was open for business.

But at a parallel event at a different location, raucous pro-Castro crowds disrupted a gathering of nonprofit and civil society groups, blocking Cuban dissidents from participating and denouncing the event's organizers for daring to invite them.

The tensions, which boiled over into a wild melee Wednesday in a city park, were a reminder that Cubans' deep, visceral divisions will persist long after the United States reopens an embassy in Havana.

They were also signs that while the Castro government is increasingly willing to tinker with its "socialist" economic model, the experiment doesn't extend to politics. And the government remains determined to go to great lengths to stifle critics well beyond Cuba's borders.

[Castro insists Cuba won’t abandon communism despite deal with U.S.]

Shouting "down with the mercenaries" and "long live Fidel and Raul (Castro)," pro-government groups turned drab hotel convention halls into confrontation sites Wednesday and Thursday, preventing other groups at the meeting from making their presentations. Other attendees whose presentations had nothing to do with the island expressed frustration that the Cubans had monopolized the forums.

The pro-Castro delegation said that several of its members were not issued credentials to attend the meetings, while Cuban dissidents had received them. They have also expressed anger at the apparent presence here of Castro archenemy and former CIA agent Felix Rodriguez, the man credited with hunting down revolutionary icon Ernesto "Che" Guevara in 1967 and overseeing his execution.

But there has been no sign of Rodriguez at the summit events where Cubans were present. The Cuban opposition figures who traveled to Panama said that the rest of the world was getting a glimpse of the political intolerance they face on the island.

"It's clear that they don't want dialogue," said Rosa Maria Paya, the daughter of Cuban dissident Oswaldo Paya, in comments to the Associated Press. Paya blames the Cuban government for the car wreck that killed her father in 2012. She now lives in the United States.

The raucous scenes were a striking contrast to Cuba's more-civil participation at events like Thursday's CEO Summit, which featured corporate titans like Facebook's Mark Zuckerberg and Mexican mega-billionaire Carlos Slim.

Rodrigo Malmierca, Cuba's minister of foreign trade and investment, said in a speech that while U.S. sanctions continued to limit American business with the island, Obama's recent moves toward rapprochement were "a positive step."

Malmierca said the Castro government is seeking more than $8 billion in foreign investment in its effort to spur growth. In particular, he touted the potential of a new free-trade zone west of Havana, anchored by a $1 billion port and railway project that has so far attracted more than 300 investment proposals.

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