COMPLETE DOCUMENT: Foro Cubano – Indicadores
Coordinador: Pavel Vidal Alejandro
COMPLETE DOCUMENT: Foro Cubano – Indicadores
Coordinador: Pavel Vidal Alejandro
The complete set of papers is here: ASCE Conference Proceedings for 2018.
A complete set of all the papers from the annual ASCE conferences can be found here: ASCE Conference Proceedings
|Cuba: Los Retos Económicos del Gobierno de Miguel Díaz-Canel||Omar Everleny Pérez Villanueva||PDF version|
|Cuba 2018: Entre la Continuidad y la Oportunidad||Dagoberto Valdés Hernández||PDF version|
|Cuban Peso Unification: Managed Rate and Monetary Analysis||Luis R. Luis||PDF version|
|La Agricultura en Cuba: Transformaciones, Resultados y Retos||Armando Nova González||PDF version|
|Principal Elements of Agricultural Reforms in Transition Economies: Implications For Cuba?||Mario A. González-Corzo||PDF version|
|Cuba’s Economic Liberalization and The Perils to Security and Legality||Vidal Romero||PDF version|
|Growth and Policy-Induced Distortions in The Cuban Economy: an Econometric Approach||Ernesto Hernández-Catá||PDF version|
|Comparing The Quality of Education in Pre- and Post-Revolutionary Cuba Using U.S. Labor Market Outcomes||Luis Locay and John Devereux||PDF version|
|The Global Economy and Cuba: Stasis and Hard Choices||Larry Catá Backer||PDF version|
|Five Keys to Presidential Change in Cuba||Arturo López-Levy and Rolf Otto Niederstrasser||PDF version|
|Cuba’s Political and Economic Arteriosclerosis – It Is Not Just The Castros||Gary H. Maybarduk||PDF version|
|Cuban Tourism Industry in The Eye of The Storm||Emilio Morales||PDF version|
|Experiencias de Cuentapropistas||Ted A. Henken||PDF version|
|Cuban Demography and Economic Consequences||Humberto Barreto||PDF version|
|“The Revenge of The Jealous Bureaucrat”: A Critical Analysis of Cuba’s New Rules For Cuentapropistas||Ted A. Henken||PDF version|
Papers and Proceedings of the Twenty-Fifth Annual Meeting, July 30-August 1, 2015
All papers are hyperlinked to the ASCE Website and can be seen in PDF format.
Reflections on the State of the Cuban Economy Carlos Seiglie
Los Grandes Retos del Deshielo Emilio Morales
Preparing for a Full Restoration of Economic Relations between Cuba and the United States Ernesto Hernández-Catá
Economic Consequences of Cuba-U.S. Reconciliation Luis R. Luis
El Sector Privado y el Turismo en Cuba Ante un Escenario de Relaciones con Estados Unidos José Luis Perelló Cabrera
Why Cuba is a State Sponsor of Terror Joseph M. Humire
Entrepreneurship in Post-Socialist Economies: Lessons for Cuba Mario A. González-Corzo
Revisiting the Seven Threads in the Labyrinth of the Cuban Revolution Luis Martínez-Fernández
La Economía Política del Embargo o Bloqueo Interno Jorge A. Sanguinetty
Resolving U.S. Expropriation Claims Against Cuba: A Very Modest Proposal Matías F. Travieso-Díaz
U.S.-Cuba BIT: A Guarantee in Reestablishing Trade Relations Rolando Anillo, Esq.
Estimating Disguised Unemployment in Cuba Ernesto Hernández-Catá
Reliable Partners, Not Carpetbaggers Domingo Amuchástegui
Foreign Investment in Cuba’s “Updating” of Its Economic Model Jorge F. Pérez-López
Bienal de la Habana, 1984: Art Curators as State Researchers Paloma Checa-Gismero
Luchas y Éxitos de las Diásporas Cubana Lisa Clarke
The papers presented at the 2014 Conference of the Association for the Study of the Cuban Economy are now available.
Cuba in Transition: Volume 24: Papers and Proceedings of the Twenty-Fourth Annual Meeting.
The papers listed below are hypewr-linked to directly to their respective file on the ASCE web site.
Ernesto Hernández-Catá; January, 2014
The complete essay is here: STRUCTURE OF GDP, 2014. Hernandez-Cata
This paper presents estimates of Cuba’s gross domestic product (GDP) for the three principal sector of the economy: the government, the state enterprises, and the non-state sector. It estimates government GDP on the basis of fiscal data and derives non-state GDP from a combination of employment and productivity data. The article finds that the pronounced tendency for government output to increase faster than GDP was interrupted in 2010 and as the share of non-state production increased sharply. Nevertheless, the private share in the economy remains very low by international standards, and particularly in comparison to most countries in transition. The paper also derives estimates for gross national income. It finds that income is lower than GDP in the general government sector because of interest payments on Cuba’s external debt, while it exceeds production in the non-state sector owing to remittances from Cubans residing abroad.
The various estimates presented in this paper make it possible to reach a number of tentative conclusions.
ü The government share of GDP fell during the post-Soviet recession but then increased steadily all the way to 2009. The increase reflected the growth of current government expenditure; government investment—which accounts for the bulk of economy-wide capital formation—fell in percent of GDP. Total investment by all sectors also fell, to a very low level compared with the averages for other country groups and particularly for the emerging market and transition countries. The share of government spending declined from 2010 to 2011 following the financial crisis of 2008.
ü The share of the non-state sector GDP rose in the period 1993-1999 from a very low level in the Soviet-dominated period of the 1980’s. It changed little in the first decade of the XXIst century, but surged in 2011-2012 reflecting a transfer of employees form the state sector. Nevertheless, the non-state and private sector shares of the economy remains very small by international standards and notably by the standards of the countries in transition.
ü The relative importance of the state enterprises appears to have declined all the way from 1995 to 2009, but it has recovered somewhat since then.
ü National income in the government sector is lower than GDP because of interest payments on the external debt and, apparently, because of official transfers to foreigners.
ü By contrast, income in the non-state sector exceeds GDP by a growing margin, essentially because of dollar remittances from Cuban-Americans abroad. Thus, in that sector income from domestic production is being increasingly supplemented by income from abroad.
ü There is a statistically significant tendency for government current spending to crowd out the output of the state enterprises. Non-state output, on the other hand, appears to evolve mainly in response to official decisions to liberalize or to repress the non-state sector
Finally, there is a major problem whose resolution is beyond the scope of this article but which must at least be noted. The Cuban authorities assume that data for transactions denominated in foreign currency should be translated into local currency at the fixed exchange rate of one peso (CUP) per U.S. dollar. Under this convention (which is retained in this paper) dollar values are identical to peso values. Historically, however, the exchange value of the peso applicable to households and tourists has been much lower and it is currently CUP 24 per dollar. Clearly, the 1:1 exchange rate assumption introduces major distortions in the national accounts and in the balance of payments. For example, the peso value of exports of at least some goods and services (nickel, sugar and tourism among others) is grossly under estimated, while the dollar value of consumption is grossly over-estimated. In the income accounts, the dollar value of wages (mostly denominated in CUPs) is overestimated while the peso value of private remittances is under-estimated—although this is partly offset by an under-estimation of the peso value of interest payments abroad.
The task of disentangling all the elements of bias introduced by the use of a 1:1 conversion factor would be daunting. For the time being the corresponding distortions would have to be accepted, although they should be recognized. The good news is that the Cuban authorities are in the process of unifying the existing multiple exchange rate system, too slowly hélàs, but fairly surely. One important result of this change will be to the adoption of a single exchange rate for all transactions and all sectors, as well as for the purpose of statistical conversion.
The proceedings of the Association for the Study of the Cuban Economy’s 23rd Annual Meeting entitled “Reforming Cuba?” (August 1–3, 2013) is now available. The presentations have now been published by ASCE at http://www.ascecuba.org/.
The presentations are listed below and linked to their sources in the ASCE Web Site.
Panorama de las reformas económico-sociales y sus efectos en Cuba, Carmelo Mesa-Lago
Crítica a las reformas socioeconómicas raulistas, 2006–2013, Rolando H. Castañeda
Reformas en Cuba: ¿La última utopía?, Emilio Morales
Potentials and Pitfalls of Cuba’s Move Toward Non-Agricultural Cooperatives, Archibald R. M. Ritter
Las reformas en Cuba: qué sigue, qué cambia, qué falta, Armando Chaguaceda and Marie Laure Geoffray
Cuba: ¿Hacia dónde van las “reformas”?, María C. Werlau
Immigration and Economics: Lessons for Policy, George J. Borjas
Possible Electoral Systems in a Democratic Cuba, Daniel Buigas
The Legal Relations Between the U.S. and Cuba, Antonio R. Zamora
Cambios en la política migratoria del Gobierno cubano: ¿Nuevas reformas?, Laritza Diversent
The Venezuela Risks for PetroCaribe and Alba Countries, Gabriel Di Bella, Rafael Romeu and Andy Wolfe
Venezuela 2013: Situación y perspectivas socioeconómicas, ajustes insuficientes, Rolando H. Castañeda
Cuba: The Impact of Venezuela, Domingo Amuchástegui
Should the U.S. Lift the Cuban Embargo? Yes; It Already Has; and It Depends!, Roger R. Betancourt
Cuba, the Soviet Union, and Venezuela: A Tale of Dependence and Shock, Ernesto Hernández-Catá
Competitive Solidarity and the Political Economy of Invento, Roberto I. Armengol
Biohydrogen as an Alternative Energy Source for Cuba, Melissa Barona, Margarita Giraldo and Seth Marini
Cuba’s Prospects for a Military Oligarchy, Daniel I. Pedreira
Cuba’s Economic Policies: Growth, Development or Subsistence?, Jorge A. Sanguinetty
Cuba and Venezuela: Revolution and Reform, Silvia Pedraza and Carlos A. Romero Mercado
Mercado inmobiliario en Cuba: Una apertura a medias, Emilio Morales and Joseph Scarpaci
Estonia’s Post-Soviet Agricultural Reforms: Lessons for Cuba, Mario A. González-Corzo
Cuba Today: Walking New Roads? Roberto Veiga González
From Collision to Covenant: Challenges Faced by Cuba’s Future Leaders, Lenier González Mederos
Proyecto “DLíderes”, José Luis Leyva Cruz
Notes for the Cuban Transition, Antonio Rodiles and Alexis Jardines
From Nada to Nauta: Internet Access and Cyber-Activism in A Changing Cuba, Ted A. Henken and Sjamme van de Voort
Internet and Society in Cuba, Emily Parker
Poverty and the Effects on Aversive Social Control, Enrique S. Pumar
A Century of Cuban Demographic Interactions and What They May Portend for the Future, Sergio Díaz-Briquets
Trabajo por cuenta propia en Cuba hoy: trabas y oportunidades, Karina Gálvez Chiú
Remesas de conocimiento, Juan Antonio Blanco
The Path Taken by the Pharmaceutical Association of Cuba in Exile, Juan Luis Aguiar Muxella and Luis Ernesto Mejer Sarrá
The Association for the Study of the Cuban Economy established a Blog some months ago. It promises to be the locus of timely and serious economic analyses and commentaries on the Cuban economy.
The location of the Blog is http://www.ascecuba.org/blog/
The Table of Contents as of January 6 2013 was as follows. Each article is linked to the original location on the ASCE Blog.
The external debt of Cuba is not excessively large relative to GDP, though this is distorted by an overvalued currency and the reliance on non-cash services exports. Recent bilateral restructurings are easing the debt burden but are insufficient to lift creditworthiness and restore access to international financial markets. [More]
In this paper a model of overall price behavior for the Cuban economy is estimated. The model, despite limitations, explains reasonably well the path of the GDP deflator. Importantly, the model sheds light on the interaction between unit labor costs, consumption subsidies and the behavior of prices in the economy. [More]
The movement towards a unified exchange rate is positive, though a gradualist approach presents some dangers, argues Ernesto Hernandez-Cata in this post. [More]
Este artículo de Rolando Castañeda señala la necesidad de estimular la actividad privada propiamente dicha para alcanzar mayor productividad y empleo como han demostrado un gran número de economías en transición. [More]
Ernesto Hernandez-Cata estimates the net value of Cuban donations abroad. [More]
Este trabajo presenta estimaciones de la estructura del PIB cubano para el gobierno, empresas del estado y el sector no estatal e ilustra la relativamente baja contribución del sector privado a la economía. [More]
The members of ASCE are deeply saddened by the news of the passing after a long illness of Oscar Espinosa Chepe in Madrid on September 23.[More]
In this post Luis R. Luis analyzes implications of the lack of full dollar backing for the convertible Cuban peso (CUC), one of the two national currencies circulating in Cuba. [More]
This post looks at state support to Cuban enterprises and uncovers that net transfers are again rising. The reasons for this are not always clear but Ernesto Hernandez-Cata offers a plausible explanation. [More]
Roger Betancourt analyzes the evolution of the Cuban embargo and shows that some parts have already been lifted. Verifiable human rights guarantees may provide a way to elicit political support in the US for action to change trade and financial elements of the embargo. [More]
Ernesto Hernández-Catá comenta sobre el sistema de cambios múltiples vigente en Cuba. [More]
Joaquín P. Pujol comenta en esta nota sobre la dualidad monetaria en Cuba. [More]
En este artículo Roberto Orro describe el complejo sistema monetario y cambiario de Cuba y sugiere que la unificacion monetaria no está a la vista. [More]
Roberto Orro argues in this article that the Cuban economy experienced two distinct periods where either investment or consumption prevailed. This behavior was influenced by external factors among them the assistance derived from the Soviet Union as contrasted to that coming presently from Venezuela. [More]
In this post Luis R. Luis gauges the progress of Cuba’s recent economic reforms using Transition Indicators developed by the European Bank for Reconstruction and Development (EBRD). [More]
The end of Venezuelan aid to Cuba will have a sizable negative impact on the economy though very likely of lesser magnitude than the withdrawal of Soviet assistance in the 1990’s concludes Ernesto Hernandez-Cata in this article. [More]
Rolando H. Castaneda argues that the high levels of Venezuelan aid to Cuba are unsustainable and constitute a heavy burden for both countries even for Cuba in the medium-term as the assistance allows the postponement of essential economic reforms. [More]
In this post Ernesto Hernandez-Cata analyzes Cuban labor market data, identifying large sectoral changes in employment that signal the beginning of large scale privatization of employment in the island. [More]
In this article Ernesto Hernandez-Cata explores Cuban official statistics to show that Venezuelan subsidies rival or exceed those flowing from the former Soviet Union during the 1980s. This raises questions of sustainability and severe adjustment for both countries. [More]
Cuba’s weak international accounts and liquidity and lack of access to financial markets place the country in a difficult position to withstand a potential cut in Venezuelan aid argues Luis R. Luis. The failure of reforms to boost farm output and merchandise exports make the economy highly dependent on Venezuelan aid and remittances from Cubans living abroad. [More]
Recently there have been several estimates of Venezuelan economic assistance to Cuba—for example by Lopez (2012) and Mesa-Lago (2013). My latest estimates suggest that payments from Venezuela increased rapidly during the first decade of the XXI century and peaked at almost 19% of Cuba’s GDP) in 2009. They declined over the following two years but remained quite large: I estimate Venezuelan assistance in 2011 (the last year for which the required data are available) at just over $7 billion, or 11 % of Cuba’s GDP. These numbers are large, and they have invited comparisons with Soviet assistance to Cuba in the late 1980s. It has been implied that the adverse effect on Cuba’s real GDP of ending Venezuelan aid would be similar in size to the devastating impact of the elimination of Soviet aid in 1990. This is almost certainly wrong.
The analysis presented in this paper indicates that a complete cancellation of Venezuelan assistance to Cuba would cause considerably less damage than the elimination of Soviet assistance in the early 1990s, with the fall in real GDP estimated at somewhere between 7% and 10%, compared to 38% after the breakdown of Cuban/Soviet relations. Moreover, if the Cuban government were to avoid the policies of subsidization and inflationary finance pursued in the post-Soviet period, the post-Venezuelan contraction would be at the lower end of the range or approximately 7%.
This is still a lot, however. To be sure, the danger of a sudden elimination of aid inflows has diminished considerably since the Venezuelan election of April 2013. Nevertheless, the prospect of a more gradual reduction in aid remains likely given Venezuela’s economic difficulties. In that case, the effect would be a reduction in the growth of the Cuban economy spread over several years, rather than a sudden contraction of output. Furthermore, current efforts to obtain financing at non-market terms from other countries, like Algeria, Angola and Brazil, would, if successful, diminish the magnitude of the shock. But it would perpetuate dependence and delay the needed adjustment.
The only way to diminish the pain of reduced income and consumption would be a decisive effort to expand Cuba’s productive capacity by intensifying the reform process. The list of required actions is familiar to all: liberalize prices, unify the exchange rate system, dismantle exchange and trade controls, stop the bureaucratic interference with non-state agricultural producers, continue efforts to downsize employment in the state sector, and increase substantially the list of activities opened to the private sector, including (why not?) doctors, nurses, teachers and athletes. Private clinics and schools would pop up, consultancy services would flourish, and the baseball winter leagues would come back to life.
Karl Marx (1852) credited Hegel with the idea that history repeats itself twice. Unfortunately for him, he added: “the first time as a tragedy, the second time as a farce”. This is not necessarily true. Often the second time is also a tragedy, as when the West gave Eastern Europe to Stalin at Yalta, less than a decade after giving it to Hitler in Munich. And why couldn’t the second time be an epiphany? Cuba’s rulers now have a historic opportunity to allow people to improve their own standard of living, and to stop wasting resources to keep the faded and sinister red banner afloat. Without a doubt, history will absolve them if they take that chance. And then, perhaps, Cuba will be allowed to replace its politically inspired dependence on doubtful friends with free, mutually beneficial trade with all nations.
Ernesto Hernandez-Cata was born in Marianao, Havana, Cuba in 1942. He holds a License from the Graduate Institute of International Studies in Geneva, Switzerland; and a Ph.D. in economics from Yale University. For about 30 years through, Ernesto Hernandez-Cata worked for the International Monetary Fund where he held a number of senior positions. When he retired from the I.M.F. in July 2003 he was Associate Director of the African Department and Chairman of the Investment Committee of the Staff Retirement Plan. Previously he had served in the Division of International Finance of the Federal Reserve Board. From 2002 to 2007 Mr. Hernandez-Cata taught economic development and growth at the Paul Nitze School of Advanced International Studies of the University of Johns Hopkins. Previously he had taught macroeconomics and monetary policy at The American University.
Ernesto Hernández-Catá has agreed to have his recent essay “The Growth of the Cuban Economy in the First Decade of the XXI Century: Is it Sustainable?” posted on this Web Site. It was written for presentation at the forthcoming 22nd annual meeting of the Association for the Study of the Cuban Economy in Miami in August 2012. The full study is available here: Ernesto Hernandez-Cata, “The Growth of the Cuban Economy in the First Decade of the XXI Century”.
Income and production increased rapidly in Cuba during the first decade of the XXI century. Growth was fueled by a surge in government spending and a boom in services exports and investment—all of them made possible by rapidly increasing in payments received from Venezuela. The expansion in both domestic and foreign demand during the decade did not visibly result in higher inflation or in a massive deterioration of the country’s external position, partly because potential output also increased rapidly reflecting the strong performance of investment. (In this connection, it is a good thing that part of the Venezuelan money was used to finance capital formation rather than consumption.) However, capacity utilization also increased markedly, and the gap between actual and potential GDP must have dwindled considerably, leaving little room for supply to respond to additional demand pressures.
While there was no explosion in the current account of the balance of payments for most of the decade, severe pressures did emerge in 2008 and the authorities had to restrict imports, ration foreign exchange, and take measures that damaged the nation’s reputation in world financial markets. The Central Bank also intervened on a large scale to keep the exchange value of the Cuban peso fixed—a policy that cannot continue forever.
The large size of Cuba’s dependence on Venezuelan aid makes the country hostage to fortune. A sudden interruption in such aid would trigger a deep recession and put the balance of payments in a critical position. Therefore the structural measures that were taken or announced in 2009 and 2010 should now be extended and pursued much more aggressively. This will not be easy. But as Russia’s former Finance Minister Boris Fedorov once said, dependence on foreign largesse is a luxury that a free country cannot afford.[i]
Ernesto Hernandez-Cata was born in Havana, Cuba in 1942. He holds a License from the Graduate Institute of International Studies in Geneva, Switzerland; and a Ph.D. in economics from Yale University. For about 30 years through, Mr. Hernandez-Cata worked for the International Monetary Fund where he held a number of senior positions, including: Deputy Director of Research and coordinator of the World Economic Outlook; chief negotiator with the Russian Federation; and Deputy Director of the Western Hemisphere Department, concentrating on relations with the United States and Canada. When he retired from the I.M.F. in July 2003 he was Associate Director of the African Department\, where he dealt with Ethiopia, Guinea, Sierra Leone and the Democratic Republic of Congo, among other countries. He was also Chairman of the Investment Committee of the IMF’s Staff Retirement Plan. Previously he had served in the Division of International Finance of the Federal Reserve Board. From 2002 to2007 he taught economic development and growth at the Paul Nitze School of Advanced International Studies of the University of Johns Hopkins. Previously he had taught macroeconomics and monetary policy at The American University.
ASCE, the Association for the Study of the Cuban Economy has just published the Proceedings of its 2011 Conference. The Proceeding include a wealth of information and analyses. All articles for 2011 and indeed all the Conference proceedings for the last 21 years are freely available on the ASCE Web Site
Below is the Table of Contents for the 2011 Proceedings with all articles hyper-linked to the original ASCE source.