U.S. President Barack Obama said improved relations with Cuba and Venezuela will be realized through "frank dialogue" but also concrete action, as he prepared to leave the Summit of the Americas on Sunday afternoon.

Speaking to reporters at the close of the summit, Obama said he had received encouraging signals from both countries during his four-day visit to Central America, but added that "the test for all of us is not simply words but also deeds."

According to Obama, there is "an opportunity for frank dialogue on a range of issues, including critical issues of democracy and human rights throughout the hemisphere."

Obama has spent the better part of a week signaling his intention to improve U.S. relations with the two countries.

Upon arriving at the summit, he shook hands with Venezuelan President Hugo Chavez, who had a frosty relationship with former U.S. president George W. Bush.

Afterward, Chavez told U.S. Secretary of State Hillary Clinton that he will restore his country's ambassador to Washington.

On the Cuba front, Obama has made moves that signal a willingness to lift a decades-long embargo and normalize relations with the island nation.

Last week, he lifted a travel embargo for Cuban-Americans who wish to visit family on the island and indicated that American telecom companies would be able to provide cell phone and cable services to Cuban residents.

On Sunday, Obama said that "the policy we've had in place for 50 years has not worked."

Prime Minister Stephen Harper said "everyone" wants to normalized relations between Cuba and the rest of the hemisphere, but fostering democracy in the country is also important.

"There are two important issues or principles involving Cuba, and we shouldn't lose sight of either one," he said. "Obviously Canada has historically had diplomatic relations with Cuba and we'd like to see a certain normalization of Cuba's relationship with the rest of the hemisphere.

"At the same time, I'm told this is the first Summit of the Americas where every leader around the table has been elected in a competitive electoral process ... but that is not the case in Cuba today and I'd like to see that change."

Cuba's challenges

Canada's former ambassador to Cuba says that an improved relationship between the U.S. and Cuba would compromise Canadian business interests.

Mark Entwistle, who served as Canada's ambassador to Cuba from 1993 to 1997, said Sunday that some Canadian organizations would be pushed out of the country to make room for American businesses.

"If you took the scenario of a fairly robust (trade) opening, for example, Canadian business would certainly be affected because there's only so much market space there," Entwistle said Sunday on CTV's Question Period.

According to Entwistle, Canadian businesses have already experienced the effects of normalizing trade relations between the two countries when the American government opened a small window to agricultural trade after Hurricane Michelle ravaged the island in 2001.

At that time, some Canadian agricultural suppliers were squeezed out of Cuba, Entwistle said, and now the U.S. does well over $2 billion worth of business on the island.

And Canadian tourists, who travel to Cuba in larger numbers than any other country, may feel the squeeze, too.

Cuba's tourism infrastructure can only handle so many people, Entwistle said.

"So if you have a million Americans coming, for example, Canadians may need another tourism destination," he said.

But Canadians need not panic right away.

The thaw in the Cuban-American relationship will take some given that the two countries have been engaged in a political and ideological stand-off for more than 40 years, Entwistle said.

The Americans will likely apply conditions to normalized relations, such as the release of political prisoners, democratic elections and even the removal of the Castro brothers from power, Entwistle said.

The Cubans, meanwhile, won't want to accept conditions and will likely resist the idea of regime change.

"I think they're on a track now that's quite inexorable, but the devil is always in the details," Entwistle said. "We'll see as they start to calibrate each other how they're going to play this out."