Author Archives: Rodriguez Andrea

CUBA OPENS FOREIGN CURRENCY-ONLY SHOPS, ENDS TAX ON DOLLAR

Andrea Rodriguez | AP

Washington Post, July 20, 2020 at 7:04 p.m. EDT

HAVANA — Cuba opened shops Monday that accept only foreign currencies and eliminated a special tax on the U.S. dollar, deepening a process of collecting stronger currencies to face the country’s economic crisis. By morning, long queues had formed in a half-dozen such shops in Havana dedicated to the sale of food and toiletries. Under the new system, people buy merchandise using national or foreign cards backed by hard currencies, especially dollars, including Visa or Mastercards. Cash is not accepted.

The shelves of a large foreign-currency warehouse store visited by Associated Press journalists contained products currently missing from peso-sale stores, including detergent, minced chicken, beef and canned goods.  “It looks to me like at this critical time, when the country is going without food, there is everything” in the market, said Lenon Fernández, a 32-year-old entrepreneur who went shopping at a supermarket known as 70.

The shortages have worsened since the middle of last year when the Trump administration tightened sanctions to pressure for a change in the island’s political model. Now, on top of sanctions, a cut in remittances from abroad and internal inefficiencies, Cuba is losing tourist revenues because of the coronavirus pandemic and its GDP growth is close to 0%. The result has been long lines and exasperation due to the lack of food.

The new stores in the capital and other Cuban cities add to a dollarization process of retail trade that began in late 2019, when shops were opened under the modality of foreign currency sales for household appliances. The effect was an increase in the value of the dollar on the black market.

Before then, any transactions in currencies other than those issued by Cuba was prohibited since 2004, when the dollar was withdrawn.

This new form of sale in foreign currencies for food and cleaning goods was announced last week by President Miguel Díaz-Canel as a way of obtaining income and providing goods to the population.  The measure reflects the reality on the communist-run island of social sectors with money and dollars to spend – such as entrepreneurs, relatives who receive remittances, employees of foreign companies, etc. – and those who do not.

The government said it will keep stores in convertible pesos or CUC – almost equal to the dollar – and in Cuban pesos (24 for a CUC), which are the other two currencies circulating on the island.  It will also continue to support monthly quotas of basic foods such as rice, beans, some chicken or meat, milk, coffee and sugar.

“In the midst of an economic crisis of very uncertain scope and duration, the Diaz-Canel administration is using the political credit of its successful management of the pandemic to implement economic reforms postponed for more than a decade,” said Cuban economist Arturo López-Levy, professor at Holy Names University in California.

Cuba has managed to control the spread of the new coronavirus. In four months, authorities say it infected 2,446 people. But they reported no new confirmed cases on Monday.

In general, Cuban authorities have resisted changes – despite a timid process initiated by former President Raúl Castro in 2010 – claiming they want to limit the negative effects of inequality and not hurt vulnerable sectors.

The elimination of a 10% tax on the use of the U.S. dollar, in force since 2004, went into effect Monday. When anyone exchanged 10 dollars for CUC in the local market, they only received nine CUC.

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CUBAN ENTREPRENEURS START FIRST PRIVATE BUSINESS GROUP

A handful of entrepreneurs have quietly formed communist Cuba’s first private small business association, testing the government’s willingness to allow Cubans to organize outside the strict bounds of state control.

By ANDREA RODRIGUEZ, Associated Press. June 1, 2017

HAVANA (AP) — A handful of entrepreneurs have quietly formed communist Cuba’s first private small business association, testing the government’s willingness to allow Cubans to organize outside the strict bounds of state control.

More than a half million Cubans officially work in the private sector, with tens, perhaps hundreds, of thousands more working off the books. Cuba’s legal system and centrally planned state economy have changed little since the Cold War, however, and private business people are officially recognized only as “self-employed,” a status with few legal protections and no access to wholesale goods or the ability to import and export.

The government is expected to take an incremental step toward changing that Thursday when Cuba’s National Assembly approves a series of documents updating the country’s economic reform plan and laying out long-term goals through 2030. Those goals include the first official recognition of private enterprise and small- and medium-size businesses, although it could be years before any actual changes are felt on the ground in the country.

The Havana-based Association of Businessmen is trying to move ahead faster, organizing dozens of entrepreneurs into a group that will provide help, advice, training and representation to members of the private sector. The group applied in February for government recognition. While the official deadline for a response has passed, the group has yet to receive either an OK or negative attention from authorities, leaving it in the peculiar status known in Cuba as “alegal” or a-legal, operating unmolested but vulnerable to a crackdown at any time.

“People have approached with a lot of interest but they don’t want to join until we’re officially approved,” said Edilio Hernandez, one of the association’s founders. Trained as a lawyer, Hernandez also works as a self-employed taxi driver.

“Many people really understand that entrepreneurs need a guiding light, someone who helps them,” he said.

Another founder, Rodolfo Marino, has a construction license and has worked privately and under contract to state agencies. He said organizers of the association have gone door-to-door trying to recruit members by convincing them they need independent representation.

The group says roughly 90 entrepreneurs have signed up. Without legal recognition, the group is not yet charging membership fees, the organizers say. Until then, they meet occasionally in Marino’s Havana home to plan their path forward, which includes legal appeals for government recognition.

“We hope to push the country’s economic development forward,” he said.

The number of officially self-employed Cubans has grown by a factor of five, to 535,000 in a country of 11 million, since President Raul Castro launched limited market-based reforms in 2010. The government currently allows 200 types of private work, from language teacher to furniture maker. In reality, many officially self-employed people have become owners of small business, some with dozens of employees and hundreds of thousands of dollars in annual revenue — big number for a country where the monthly state salary is about $25.

Without access to government-controlled imports, exports or wholesale supplies, business owners are emptying the shelves of state stores, either by snapping up items as soon as they arrive or buying them stolen on the black market. That leaves them vulnerable to crackdowns and frequent extortion from state inspectors.

The government has taken a few tentative moves toward easing the situation in recent months — opening stores where owners of some of the country’s 21,000 bed-and-breakfasts and 2,000 private restaurants can buy large quantities of goods, although still at retail prices.

The state has also promised special access to gas and car parts to taxi drivers who comply with widely flouted government caps on fares.

Along with those small steps, the future of the Association of Businessmen is a gauge of Cuba’s openness to private enterprise and its ability to move forward, the group’s founders say.

“We really hope they approve us,” said Hernandez, the lawyer and taxi driver. “If they don’t, we’ll be in the hands of a state that considers us illegal and we won’t be able to reach our goal of representing entrepreneurs. If they do, it will be a sign that things are changing.”

Some Small Enterprises and Entrepreneurs

Photos by Arch Ritter, February 2014

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ONE OF CUBA’S MOST RENOWNED ADVOCATES OF ECONOMIC REFORM HAS BEEN FIRED FROM HIS UNIVERSITY OF HAVANA THINK TANK FOR SHARING INFORMATION WITH AMERICANS WITHOUT AUTHORIZATION, AMONG OTHER ALLEGED VIOLATIONS

Associated Press, April 21 2016

Original Article: Omar Everleny Perez Villanueva Fired

By ANDREA RODRIGUEZ, Associated Press

zzzDr. Omar Everleny Perez Villanueva

HAVANA (AP) — One of Cuba’s most renowned advocates of economic reform has been fired from his University of Havana think tank for sharing information with Americans without authorization, among other alleged violations.

The dismissal of Omar Everleny Perez adds to a chillier mood that has settled over much of Cuba as the country’s leaders try to quash the jubilation that greeted President Barack Obama’s historic trip to the island last month.

The Cuban Communist Party’s twice-a-decade Congress ended Tuesday after four days of officials issuing tough warnings about the need to maintain a defensive stance against what they called the United States’ continuing imperialist aspirations. Foreign Minister Bruno Rodriguez described Obama’s visit as an “attack on the foundation of our political ideas, our history, our culture and our symbols.” President Raul Castro described the U.S. as an “enemy” seeking to seduce vulnerable sectors of society, including intellectuals and members of Cuba’s new private sector.

While that was going on, Cuban academics began sharing the news that Perez had been dismissed from his post at the Center for Studies of the Cuban Economy on April 8, less than three weeks after Obama’s visit.

Perez is one of the country’s best-known academics, an expert in developing economies who served as a consultant for Castro’s government when it launched a series of market-oriented economic reforms after he took over from his brother Fidel in 2008. Perez made dozens of trips to universities and conferences in the U.S. with university approval and frequently received foreign visitors researching the Cuban economy.

Reached by The Associated Press on Wednesday, Perez confirmed his dismissal by center director Humberto Blanco for having unauthorized conversations with foreign institutions and informing “North American representatives” about the internal procedures of the university.

The dismissal letter described Perez, 56, as “irresponsible” and “negligent” for continuing to engage in unauthorized activity after warnings from his superiors. It also accused him of receiving unauthorized payments for a study of the South Korean economy and said he was barred from returning to work for at least four years.

Perez said he had appealed his dismissal, and believes Cuban authorities were seeking to make an example of him — not because of the allegations in the letter, but because of his critical writings about the slow pace of economic reforms.

“Sometimes they don’t like what you write or think,” he told the AP.

Cuban government representatives did not respond to request for comment on Perez’s dismissal.

Perez was one of the first state economists to begin publishing in non-government publications, including several run by the Catholic Church. In 2010, he became a key consultant in reforms implemented by Raul Castro that include the legalization of hundreds of new types of private businesses, a loosening of restrictions on foreign investment, the opening of a real estate market and the handing of unused agricultural land to small farmers.

“I’m still a revolutionary and a nationalist and I believe in many of the reforms that Raul Castro is undertaking,” he said.

Cuba’s system is based on the communist government’s total oversight of virtually all elements of society, including the press, arts and academia.

While room for debate has grown somewhat under Raul Castro, and Cubans openly criticize the government in private conversations, intellectuals who publicly offend official sensibilities have found themselves losing their state jobs and other privileges.

“His call to speed up the reforms and make them coherent may have served to frighten some of the forces of immobility in the bureaucracy,” said Armando Chaguaceda, a Cuban political scientist based at the University of Guanajuato in Mexico. “It’s a terrible message to economists that will affect the government’s own capacity to hear feedback about its reforms.”

Political scientist Esteban Morales was expelled from the Communist Party in 2010 for two years for denouncing corruption. Sociologist Roberto Zurbano lost his job at a state cultural center after discussing racism in Cuba in an editorial published in The New York Times. In 2013, musician Roberto Carcasses was temporarily barred from cultural institutions after criticizing the government during a concert, and director Juan Carlos Cremata was prevented last year from putting on a production of Eugene Ionesco’s “Exit the King,” a play about a once-powerful dying leader.

Pavel Vidal, a former colleague of Perez now working in Colombia, said the University of Havana was taking limits on academic work to an extreme.

“The public work of academics has been coming under increasingly greater control,” he said, even as Castro’s reforms make it more urgent for the country to have “new ideas and an open and honest debate about the future of the country.”

 

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UNUSUAL DISSENT ERUPTS INSIDE CUBAN COMMUNIST PARTY

By Andrea Rodriguez and Michael Weissenstein
Associated Press, Mar 30, 2016

Original article: Dissent inside the Party

HAVANA (AP) — Days after President Barack Obama’s historic visit, the leaders of Cuba’s Communist Party are under highly unusual public criticism from their own ranks for imposing new levels of secrecy on the future of social and economic reforms.

After months of simmering discontent, complaints among party members have become so heated that its official newspaper, Granma, addressed them in a lengthy front-page article Monday. It said the public dissatisfaction over the lack of open discussion before the upcoming Communist Party congress next month is “a sign of the democracy and public participation that are intrinsic characteristics of the socialism that we’re constructing.”

The article did little to calm many party members, some of whom are calling for the gathering to be postponed to allow public debate about the government’s plans to continue market-oriented reforms for Cuba’s centrally controlled economy.

“The base of the party is angry, and rightly so,” party member and noted intellectual Esteban Morales wrote in a blog post published before Obama’s visit. “We’ve gone backward in terms of democracy in the party, because we’ve forgotten about the base, those who are fighting and confronting our problems on a daily basis.”

Across the country, Cuba’s ruling party is facing stiff challenges as it tries to govern an increasingly cynical and disenchanted population.

Struggling to feed their families with state salaries around $25 a month, many ordinary Cubans see their government as infuriatingly inefficient and unresponsive to the needs of average people. The open anger among prominent party members in the middle of sweeping socio-economic reforms and normalization with the United States hints at a deeper crisis of credibility for the party that has controlled virtually every aspect of public life in Cuba for more than a half century.

The article in Granma appeared less than a week after Obama won an enthusiastic response from many ordinary Cubans by calling for both an end to Cold War hostility and for more political and economic freedom on the island. The unsigned article shared the front page with Fidel Castro’s sharply worded response to Obama, in which the 89-year-old father of Cuba’s socialist system said, “My modest suggestion is that he reflect and doesn’t try to develop theories about Cuban politics.”

Many Cubans are skeptical of free-market capitalism, wary of American power and cannot envision a society without the free health care and education put in place by the 1959 revolution. Party member Francisco Rodriguez, a gay activist and journalist for a state newspaper, said Obama’s nationally televised speech in Old Havana, his news conference with 84-year-old President Raul Castro and a presidential forum with Cuban entrepreneurs represented a sort of “capitalist evangelizing” that many party members dislike.

Rodriguez told The Associated Press that Obama’s well-received addresses to the Cuban people had nonetheless increased pressure on the 700,000-member Communist Party to forge a more unified and credible vision of the future.

“Obama’s visit requires us, going forward, to work on debating and defending our social consensus about the revolution,” Rodriguez said.

While Cuba’s non-elected leaders maintain tight control of the party and the broader system, the last party congress in 2011 was preceded by months of vigorous debate at party meetings about detailed documents laying out reforms that have shrunk the state bureaucracy and allowed a half million Cubans to start work in the private sector.

In the run-up to the party congress scheduled to begin April 16, no documents have been made public, no debate has taken place and many of the party’s best-known members remain in the dark about the next phase of Cuba’s reforms. Granma said 1,000 high-ranking party members have been reviewing key documents.

“My dissatisfaction is rooted in the lack of discussion of the central documents, secret to this day, as much among the organizations of the party base as the rest of the population,” Rodriguez wrote in an open letter Sunday to Raul Castro, who is also the top Communist Party leader.

Under Castro’s guidance, the 2011 party congress helped loosen state control of Cubans’ economic options and some personal freedoms, moving the country toward more self-employment, greater freedom to travel and greater ability to sell personal cars and real estate. The Granma article argued that the months of debate before the approval of those reforms made a new round of public discussion unnecessary. It also acknowledged that only 21 percent of the reforms had been completed as planned.

The April 16-19 party congress “will allow us to define with greater precision the path that we must follow in order for our nation, sovereign and truly independent since Jan. 1, 1959, to construct a prosperous and sustainable socialism,” the article said.

Rodriguez, who works closely with Castro’s daughter Mariela, the director of the national Center for Sexual Education, said the Granma piece was unsatisfactory. He called for the Seventh Party Congress to be delayed, saying many fellow party members share his point of view.

In the days after the Granma article appeared about two dozen people, many identifying themselves as party members, posted lengthy comments on the paper’s government-moderated website that criticized the article and the secrecy surrounding the upcoming party congress, which is widely seen as helping mark the transition of power from the aging men who led Cuba’s revolution to a younger generation.

“It is one of the last congresses directed by the historic generation,” wrote one poster identifying himself as Leandro. “This is, I think, a bad precedent for future leaders, who will feel like they have the right to have party congresses without popular participation.”

Dissent? What dissent?

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Cuba Defends its Coastline

By ANDREA RODRIGUEZ,  Associated Press Jun 12, 2:49 PM EDT

CAYO COCO, Cuba (AP) — After Cuban scientists studied the effects of climate change on this island’s 3,500 miles (5,630 kilometers) of coastline, their discoveries were so alarming that officials didn’t share the results with the public to avoid causing panic.

The scientists projected that rising sea levels would seriously damage 122 Cuban towns or even wipe them off the map. Beaches would be submerged, they found, while freshwater sources would be tainted and croplands rendered infertile. In all, seawater would penetrate up to 1.2 miles (2 kilometers) inland in low-lying areas, as oceans rose nearly three feet (85 centimeters) by 2100.

Climate change may be a matter of political debate on Capitol Hill, but for low-lying Cuba, those frightening calculations have spurred systemic action. Cuba’s government has changed course on decades of haphazard coastal development, which threatens sand dunes and mangrove swamps that provide the best natural protection against rising seas.

In recent months, inspectors and demolition crews have begun fanning out across the island with plans to raze thousands of houses, restaurants, hotels and improvised docks in a race to restore much of the coast to something approaching its natural state.

“The government … realized that for an island like Cuba, long and thin, protecting the coasts is a matter of national security,” said Jorge Alvarez, director of Cuba’s government-run Center for Environmental Control and Inspection.

At the same time, Cuba has had to take into account the needs of families living in endangered homes and a $2.5 billion-a-year tourism industry that is its No. 1 source of foreign income.

It’s a predicament challenging the entire Caribbean, where resorts and private homes often have popped up in many places without any forethought. Enforcement of planning and environmental laws is also often spotty.

With its coastal towns and cities, the Caribbean is one of the regions most at risk from a changing climate. Hundreds of villages are threatened by rising seas, and more frequent and stronger hurricanes have devastated agriculture in Haiti and elsewhere.

At Risk: Cayo Coco (above) and Maria la Gorda, Pinar del Rio, (below)

In Cuba, the report predicted sea levels would rise nearly three feet by century’s end.

“Different countries are vulnerable depending on a number of factors, the coastline and what coastal development looks like,” said Dan Whittle, Cuba program director for the New York-based nonprofit Environmental Defense Fund. He said the Cuban study’s numbers seem consistent with other scientists’ forecasts for the region. The Associated Press was given exclusive access to the report, but not permitted to keep a copy.

Cuba’s preparations were on clear display on a recent morning tour of Guanabo, a popular getaway for Havana residents known for its soft sand and gentle waves 15 miles (25 kilometers) east of the capital.

Where a military barracks had been demolished, a reintroduced sand-stabilizing creeper vine known as beach morning glory is reasserting itself on the dunes, one lavender blossom at a time.

The demolition nearby of a former swimming school was halted due to the lack of planning, with the building’s rubble left as it lay. Now inspectors have to figure out how to fix the mess without doing further environmental damage.

Alvarez said the government has learned from such early mistakes and is proceeding more cautiously. Officials also are also considering engineering solutions, and even determining whether it would be better to simply leave some buildings alone.

For three decades Guanabo resident Felix Rodriguez has lived the dream of any traveler to the Caribbean: waking up with waves softly lapping at the sand just steps away, a salty breeze blowing through the window and seagulls cawing as they glide through the crisp blue sky. Now that paradise may be no more.

“The sea has been creeping ever closer,” said Rodriguez, a 63-year-old retiree, pointing to the water line steps from his apartment building. “Thirty years ago it was 30 meters (33 yards) farther out.”

“We’d all like to live next to the sea, but it’s dangerous … very dangerous,” Rodriguez said. “When a hurricane comes, everyone here will just disappear.”

Cuban officials agree, and have notified him and 11 other families in the building that they will be relocated, though no date has been set. Rodriguez and several other residents said they didn’t mind, given the danger.

Since 2000, Cuba has had a coastal protection law on the books that prohibits construction on top of sand and mandates a 130-foot-wide (40-meter) buffer zone from dunes. Structures that predate the measure have been granted a stay of execution, but are not to be maintained and ultimately will be torn down once they’re uninhabitable.

Serious enforcement only began in earnest in recent months, as officials came armed with the risk assessment.

Some 10,000 sanctions and fines have been handed down for illegal development, according to Alvarez. Demolitions have so far been limited to vacation rentals, hotel annexes, social clubs, military installations and other public buildings rather than private homes.

“Less strict measures have been taken with the people,” Alvarez said, acknowledging that relocating communities is tough in a country with a critical lack of adequate housing.

One flashpoint is the powdery-white-sand resort of Varadero, a two-hour’s drive east of the capital, where lucrative hotels attract hundreds of thousands of visitors each year from Canada, Europe and Latin America.

Some 900 coastal structures have been contributing to an average of about 4 feet (1.2 meters) of annual coastline erosion, according to geologist Adan Zuniga of Cuba’s Center for Coastal Ecosystems Research, a government body. Building solid structures on top of dunes makes them more vulnerable to the waves.

“These are violent processes of erosion,” Zuniga said about regional development. “In many places the beaches are receding 16 feet (5 meters) a year.”

Varadero symbolizes Cuba’s dilemma: Tearing down seaside restaurants, picturesque pools and air-conditioned hotels threatens millions of dollars in yearly tourism revenue, but allowing them to stay puts at risk the very beaches that were the draws in the first place.

Cuban officials have tried to get around that choice by replenishing lost sand in Varadero, with plans to do the same next year at the Cayo Coco resort. But beach replenishment is an expensive remedy that Cuba can little afford to carry out nationwide. Zuniga said it costs $3 to $8 per cubic meter, and a single beach might contain up to 1 million cubic meters of sand.

The measure will still be necessary at Cayo Coco although the resort was developed with environmental mitigations such as keeping hotels behind the tree line and running a hydraulic system that keeps water circulating properly in an inland lagoon.

There are no publicly available figures on how many structures have been or will be razed across Cuba. Alvarez and Zuniga said officials are evaluating problem buildings on a case-by-case basis, taking into account the needs of local economic development.

They say nothing is off-limits; even the emblematic Hotel Internacional, a four-story resort built in 1950 as a sibling to the Fontainebleau in Miami, has been doomed to demolition in Varadero at an unspecified date.

Other installations are gradually being moved inland, and government officials are applying stricter oversight on new construction, they said. In May, authorities unveiled the near-completed Hotel Melia Marina Varadero and yacht club, which lies at a safe remove from the sea.

Cuba’s Communist government wields a unique advantage, one no other country in the region claims: The government and its subsidiaries control the island’s entire hotel stock, sometimes teaming with minority foreign partners on management. Cuba’s military-run Gaviota Group alone controls more than three-dozen major hotels.

So when the government makes up its mind to tear down a hotel, it can do so without having to worry about fighting a lengthy court battle against a displaced owner.

On top of that, oversight of the coastal initiative happens at the highest level possible: Cuba’s ruling Council of State, headed by President Raul Castro.

“He is leading this battle,” Alvarez said of Castro.

Whittle said the island can learn some things from Costa Rica, where significant swaths of coastal and inland terrain have been protected even as tourism flourishes. For Cuba, there’s a lot riding on striking the right balance.

“Will Cuba become a sustainable destination like Costa Rica?” Whittle asked. “Or will it go the way of Cancun and much of the rest of the Caribbean that has essentially sacrificed natural areas, marine and coastal ecosystems for economic development in the short run?”

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