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 / Updated  / Source: NBC News
By Halimah Abdullah

President Barack Obama is expected to announce that he is accepting a recommendation from the State Department to take Cuba off the State Sponsors of Terror list, sources told NBC News.

The announcement, which could come as soon as Thursday, is timed to remove a major obstacle toward normalization of relations with Cuba, just as Obama is set to meet Cuban President Raul Castro on the sidelines of a Latin American summit in Panama on Friday and Saturday.

Cuba was added to the terror list on March 1, 1982. The U.S. also considers Sudan, Syria and Iran sponsors of terror.

Responding to reports of the expected announcement, Cubadebate _ the online news service run by the Cuban Council of State _ stated it is "morally unacceptable to stay for another minute" on the terrorism list that it referred to as "manipulated" and carrying serious financial problems.

The President, who arrived in Jamaica Wednesday night, will travel to Panama City Thursday evening. Obama and Raul Castro spoke last December by phone but have not had substantive conversations in person. They met briefly in passing when both attended Nelson Mandela's funeral in December 2013.

Until this year, the U.S had blocked Cuba from attending Summits of the Americas, annual meetings of western hemisphere heads of state. U.S. and Cuban diplomats have been working for the past three months to clear roadblocks to upgrade Interest Sections, diplomatic outposts in each capital, to become formal Embassies. The terror designation has been one of the issues of greatest concern to Havana. To remove Cuba from the terror list, the president must agree with a State Department review that finds Cuba has not sponsored acts of terror for at least three months, among other requirements.

While not a legal barrier, in practice the terror designation has led U.S banks to refuse services to Cuban diplomats living and working in New York and Washington. Once the President submits his finding to Congress, it will have 45 days to overturn it, a move that is highly unlikely.

The embassy designations are expected in the next few weeks to several months at most. When a U.S embassy opens in Havana, Secretary of State John Kerry is expected to travel to Cuba to officiate at the ceremony.

Kerry is scheduled to fly to Panama on Thursday to meet with Cuba's Foreign Minister Bruno Rodriguez in what will be the highest level meeting between U.S and Cuban officials in more than half a century.


—Andrea Mitchell