PANAMA CITY (AFP) - US President Barack Obama has been advised by aides to remove Cuba from a list of state sponsors of terrorism, a major hurdle in his diplomatic thaw with Havana.
As Obama arrived in Panama on Thursday for a historic gathering with Cuban President Raul Castro at the Summit of the Americas, it emerged that the State Department has advised the president to take Cuba off the blacklist.
Earlier, Obama said he would not make a formal announcement until he has the recommendations in full, but a leading member of the Senate foreign relations committee indicated the department's advice was clear.
"The State Department's recommendation to remove Cuba from the list of state sponsors of terrorism, the result of a months-long technical review, is an important step forward in our efforts to forge a more fruitful relationship with Cuba," said Senator Ben Cardin.
Having Cuba's name on the list has been a major sticking point in negotiations aimed at reopening embassies, which closed after the Cold War-era foes broke relations in 1961.
The blacklisting means that Cuba is subject to a ban on weapons exports and economic aid as well as financial sanctions that make it difficult to get World Bank and other loans.
Cuba was first put on the list, which also includes Syria, Sudan and Iran, in 1982 for harbouring ETA Basque separatist militants and Colombian FARC rebels.
Obama said the overall talks on establishing diplomatic relations with Cuba was moving along as he expected.
"I never foresaw that immediately overnight everything would transform itself, that suddenly Cuba became a partner diplomatically with us the way Jamaica is, for example," he said. "That's going to take some time."
"I do think that we'll be in a position to move forward on the opening of embassies in respective countries," Obama said.
US Secretary of State John Kerry arrived in Panama hours before Obama and was expected to meet with Cuban Foreign Minister Bruno Rodriguez, which would mark the highest-level talks in decades.
An announcement about the terror list during the 35-nation Summit of the Americas on Friday and Saturday would add to the historic symbolism of the gathering.
The meeting will mark the first time that a Cuban leader attends the event, heralding a new milestone in the diplomatic thaw.
"Cuba's presence on the list is seen in Cuba as an unfounded insult and a lie," said Arturo Lopez-Levy, a Cuban analyst at New York University.
Mark Weisbrot, director of the Washington-based Center for Economic and Policy Research think tank, said removing Cuba from the list would be "just the beginning" of efforts to normalise relations.
"This is just a bare-minimum first step," Weisbrot said, noting that Havana also wants Congress to lift the US embargo and Washington to abandon the Guantanamo Bay naval base on Cuba's eastern edge.
- US Congress review -
Cuba's removal from the list would not be immediate. Congress would have 45 days to decide whether to override Obama's recommendation.
US lawmakers who have been critical of the diplomatic detente could seize on the review of the list to further attack Obama's Cuba policy.
US Senator Ted Cruz, a Cuban-American Republican running for his party's presidential nomination, has been among the most vocal critics of the rapprochement.
A scene of lingering tensions among Cuban dissidents and government sympathisers emerged on Wednesday in Panama City.
Some 100 Castro regime supporters jeered dissidents as they arrived at a Latin American civil society forum in a Panama City hotel, shouting "sell outs" and "imperialists" before leaving the event.
US State Department spokesman Marie Harf slammed reports that Cuban dissidents were attacked.
"We condemn those who use violence against peaceful protesters," Harf said.
- Maduro petition -
Analysts have pointed to another potential problem for Obama at the summit - the sanctions he imposed against Venezuelan officials accused of human rights abuses in an opposition crackdown.
Venezuelan President Nicolas Maduro, Havana's main ally in the region, hopes to bring a petition signed by 10 million of his citizens urging Obama to lift his executive order.
Other Latin American nations have criticised the order, which calls Caracas a US national security threat.
Seeking to ease tensions, Obama said the United States does not see Venezuela as a threat. The White House says the legal term is a requisite for sanctions.
"But we do remain very troubled by the Venezuelan government's efforts to escalate intimidation of its political opponents," Obama told Spanish news agency EFE.