THE United States and Cuba announced Wednesday that they have agreed to normalize diplomatic relations more than 50 years after they were severed in a historic shift in policy.

    Senior U.S. officials said the United States and Cuba will move to open embassies in each other’s capitals. The announcement came after Obama spoke Tuesday to Cuban President Raul Castro to discuss the changes in a call that lasted nearly an hour.

    The shift will mean a relaxation in the flow of commerce and transportation by the United States to Cuba, the officials said.

    As part of a prisoner swap under the new policy, Cuba freed American Alan Gross in exchange for three Cubans held by the United States, the officials said. Cuba is also releasing a U.S. intelligence agent held for nearly 20 years. U.S. Secretary of State John Kerry will review Cuba’s designation as a state sponsor of terrorism.

    “These steps will be the most significant changes to our Cuba policy in more than 50 years,” a senior administration official told reporters. “What we are doing is beginning the normalization of relations between the United States and Cuba.”

    The official said the United States will be initiating high-level contacts and visits with Cuba.

    “We will be immediately initiating discussions with Cuba to re-establish diplomatic relations that have been severed since 1961,” the official said.

    The United States imposed a trade embargo against Cuba — the Cold War foe closest to its shores — in 1960 and the two countries have not had full diplomatic relations since 1961.(SD-Agencies)