• The objective of this Blog is to facilitate access to research resources and analyses from all relevant and useful sources, mainly on the economy of Cuba. It includes analyses and observations of the author, Arch Ritter, as well as hyper-links, abstracts, summaries, and commentaries relating to other research works from academic, governmental, media, non-governmental organizations and international institutions.
    Commentary, critique and discussion on any of the postings is most welcome.
    This Blog on The Cuban Economy is dedicated to Cuba's Generation "A". Although inspired by Yoani Sánchez' original blog "Generation Y" this is not dedicated to those with names starting with the letter "A". Instead, it draws from Douglas Coupland's novel Generation A which begins with a quotation from Kurt Vonnegut at a University Commencement:
    "... I hereby declare you Generation A, as much as the beginning of a series of astounding triumphs and failures as Adam and Eve were so long ago."

CUBAN AGRICULTURE: STRATEGIC BUT INERT

Miriam Leiva, independent journalist.

Cuba Study Group, August 16, 2021

Original Article:  Cuban Agriculture: Strategic But Inert

One of the many existing theories about the origin of the name “Cuba” refers to a word from the natives of the island that meant “cultivated land.” Although we are not sure that this is correct, we do know that the immense possibilities for agriculture, together with an excellent climate and a good geographical position, marked the value of a Caribbean island that otherwise lacked great natural resources.

Throughout Cuban history, the development of agriculture retained a position of special interest. Since the colonial era, the island became the largest producer of sugar cane in the world, a trend that increased during a large part of the republican years.

Perhaps because of this, anyone would have thought that after the supposed return of the land to its “owners,” the nascent revolution would focus on the development of one of the island’s main riches. But was it so?

Today, 529 years after Cuba was discovered, and after 61 years of land mismanagement, Cuban agriculture faces one of its worst crises marked by a chronic inability to produce food. It is in this context that the government has announced the application of 63 measures with the aim of rescuing an agricultural system that, although recognized as strategic, lies inert before our eyes. Seven groups of stakeholders, among which are agricultural executives, experts, academics, and prominent producers, were consulted in their formulation.

The measures have been described by the current minister of agriculture, Ydael Pérez, as “(…) unprecedented in Cuban agriculture (…)”. They include initiatives such as an agricultural development bank, insurance expansion, the repeal of some of the old “obstacles,” and the legalization of trade of meat and bovine milk. Additionally, some restructuring carried out in the Ministry of Agriculture (MINAG) and in the cooperatives stand out, as well as a certain level of autonomy placed in the hands of state companies, provincial governments, and their local executives. Finally, the creation of an Innovation Committee and other new institutions are also notable and aim to achieve the long-awaited increase in production that Cuban President Miguel Díaz-Canel spoke about.

These measures could be considered the prelude to “changing the way of thinking,” as the head of agriculture pointed out. However, and despite the high expectations generated by this supposed call for change, the results of these measures do not satisfy the expectations of the people and especially those of farmers, who lack decision making freedom.

A real change, which is becoming more and more necessary, should begin with profound transformations in MINAG, not just superficial ones. Transformations that encompass management chain cadres, intermediaries, and the producers themselves, but above all, that revolutionize the state enterprise system, where the greatest inefficiencies in production and marketing are found. It won’t be until then that we reach the goal of substituting imports and building a sustainable offer, which Prime Minister Manuel Marrero Cruz spoke about on May 10 during the meeting to present this document.

So, one wonders, under what conditions are these measures announced?

The Tarea Ordenamiento (or “Organizing Task” or “OT”) was introduced on January 1st, 2021, a process promoted by the Cuban Government which is trying to save the island’s economy through monetary and exchange rate unification, income reform, and the elimination of excessive subsidies, among others. The O.T. shocked Cuban farmers with the low prices attributed to their production in relation to the high costs of necessary supplies and services. As is to be expected, this combination was terribly inefficient and as a consequence discouraged production. In the middle of this scenario, the government adjusted electricity and water rates, agricultural aviation, and others, in some cases at the expense of the state budget. But did it solve the problem?

The answer is, no, it did not. The fundamental objective of the new export and import capabilities (which must be done through state foreign trade companies) and the offers of agricultural inputs, tractors, and other equipment in stores that sell in Freely Convertible Currencies (dollars, euros, etc.) was to motivate farmers to invest, but it is unlikely they will carry out bold ventures without having guarantees of returns on their investments or that their profits will be respected. Let us not forget that the Constitution itself stipulates the limits for the accumulation of wealth in non-state hands.

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Continue Reading:

Conclusions:

The crisis in Cuban agriculture is serious, and the solutions to its main problems—lack of production, little application of science and technology, low stimulation of the productive forces, etc.—need the immediate commitment of all its actors.

The 63 measures recently announced are still insufficient, since they do not completely eliminate the Cuban farmers’ lack of decision-making freedom; however, these are the prelude to future changes.

The current government has before it the responsibility of pulling Cuba off the cliff, amidst the adversities imposed by the United States sanctions and the Covid-19 pandemic, which demands a true openness to citizen participation and creativity from all Cubans.

With Miriam Leiva, Spring 2010

Complete  Essay

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IT’S NOT JUST THE US EMBARGO

As much as the US embargo contributes to its problems, Cuba’s historic protests show that the government can’t ignore citizens’ legitimate demands

International Politics and Society, 23.08.2021 |

Carlos Alzugaray

Original Article: “Not Just the Us Embargo” 

After protests swept the whole country in July, the Cuban government has started taking measures to contain the fallout. While this response goes beyond the regime’s initial repression, it hasn’t yet entirely left that path. If the country’s leadership wants to survive this test, it has no choice but to respond to citizens’ legitimate demands.

Whether one may like it or not, the events of 11 July 2021 will have an effect on how Cubans themselves and their country. For most of the population, it was a sad day – and most people would rather not remember the sad days. But it cannot be ignored. At present, information about what actually happened is still patchy; it is difficult to navigate between fake news and the official versions of events.

What has been established is that, on Sunday 11July, there were widespread anti-government protests, some of which ended in violence – and this had never happened before in Cuba. As such, many observers and indeed the authorities themselves were surprised. The result was images of violence and a situation which had escalated out of control. Whatever the details, this is objectively damaging for the Cuban government: and even if, as looks unlikely, the situation settles back down, the reputational damage will last.

NOT A SURPRISE

Actually, the Cuban government shouldn’t have been surprised by the course of events – this being the same government that had for months been talking up the possibility of a ‘soft coup’ or a ‘colour revolution’ planned across the water by its arch-enemy, the US. Perhaps it was the surprise of something actually happening that led the government to clamp down so repressively, while pursuing the same endless propaganda communication strategy as ever despite its demonstrably diminishing returns.

It’s equally surprising that this unrest did not surface much earlier, considering the privations to which the Cuban population has long been subject and which have been further worsened by the pandemic.

Thanks to the social progress of the early years and Cuba’s international high profile, unrest in the country was staved off.

Now, the unrest is here – and its effect is palpable. Just three months after the Eighth Congress of the Communist Party and two years after establishing a new constitution, the new Cuban leadership finds itself in crisis. A crisis that, in many ways, evokes the situation in the socialist countries of eastern Europe just prior to their collapse.

CUBA’S EARLY ACHIEVEMENTS

There are, however, several differences. Cuba is a third-world country which, after years of neo-colonial suppression, liberated itself by means of a national revolution. As the result of an aggressive confrontation with Washington, this revolution became increasingly radical – and was initially successful, too, in its goal of halting the advance of US imperialism. The result was a socialist model that because of an alliance with the Soviet Union offered considerable advantages for at least the next three decades.

Thanks to the social progress of the early years and Cuba’s international high profile, unrest in the country was staved off. Essentially, the fact that the socialist regime not only survived a direct confrontation with the US but went on to become a unique actor on the world stage – not only during the Cold War, but beyond – conferred considerable credit on the government and allowed it freedom of manoeuvre in domestic issues.

These achievements and successes are without doubt the foundation of Cuban regime’s resilience and its people’s stoicism in the face of lasting and quite extraordinary difficulties. Yet while these difficulties certainly are caused by the US embargo, they are in no small part also the result of governmental inadequacy and poor policy. When it comes to the role of the country’s political opposition, the situation is similar. Certainly, some groups are being supported from the US with a view to subverting the Cuban regime.

THE DOMESTIC OPPOSITION

Yet during the unrest, the activists with US support were less visible than those of the country’s domestic Movimiento San Isidro and 27N groupings. Then again, there is no doubt about the fact that protests were encouraged on social media – to no small degree by political influencers who do not live in Cuba, but rather mainly in Miami, where militant anti-Castro activism remains an important local industry financed from a range of state and non-state sources. In Cuban national reality, social media has become a toxic element as millions of dollars are pumped into fake-news campaigns aiming to destabilise the regime.

Even if, however, the trigger came from outside, unrest would not have flared up if it had, inside Cuba, not found fertile ground prepared by numerous political mistakes on the part of the government. Here, a range of factors played a role: in the poorest urban areas, conditions had worsened considerably; overall, food supply had become increasingly erratic; and after a successful start in combating the pandemic, the situation in healthcare was becoming unstable.

The government reacted by proclaiming that ‘the embargo is the problem’ and talking down the protests as ‘interference from outside’ in an effort to cover up its own errors. What the regime has underestimated is the dissatisfaction that this mantra now provokes. Certainly, the sanctions upheld against Cuba by the US for almost 60 years now represent, to paraphrase US historian Peter Beinart, a kind of economic war against a country under siege. Beinart is right to criticise the embargo as a non-military act of war – and one which, given that the stated aim has always been regime change, has never had much prospect of success. And while Washington refutes Cuban accusations, it is a simple matter of fact that Joe Biden has maintained sanctions imposed by Donald Trump even as the pandemic has continued to rage.

Continuing to place all the blame on external factors without any real introspection in respect of home-grown issues would be a grave mistake.

Yes, for more than six months now, the Biden Administration has failed to make good on its manifesto promise and remains locked in the Trumpian version of Republican Party logic vis-à-vis Cuba policy – the illusion that ever more extreme sanctions will eventually succeed in dislodging the regime which came to power in 1959. So this much seems likely: sanctions against Cuba will remain in place for the next three years; Cubans will get even poorer; the Cuban government will continue to be bullied.

THE CUBAN GOVERNMENT NEEDS A RETHINK

In view of this, Havana is currently trying to contain the fallout. Yet the regime needs to examine the political and social situation – and grasp that only economic policy focusing on efficiency and activating domestic productive capacity can get the country out of the current crisis. Continuing to place all the blame on external factors without any real introspection in respect of home-grown issues would be a grave mistake. The reforms the government has promised, especially in respect of food distribution, need to be enacted – fast.

The issue of how to deal with the figureheads of the protests adds another layer of complexity to the situation. The government cannot allow the impression to develop that, either at home or abroad, it is cracking down hard on peaceful demonstrations. Yet currently, there are rumours about summary justice and questionable court proceedings leading to sentences of ten to twelve months for people who, in many cases, do not seem to have been involved in any acts of violence. This comes for Cubans who have only recently had the important experience of debating and then approving a new constitution in which the importance of fair trials is underscored. Now more than ever, citizens are demanding nothing more – and nothing less – than that the police act within the law.

The Cuban government, too, needs to rethink how it works. As its population is increasingly deaf to the argument that the embargo is the root of all evil, it needs to make a serious attempt to overcome two key political-ideological obstacles in its way. Firstly, there is the outdated approach to socialism as a system primarily steered from central planning bureaus; this dogmatic dirigisme reduces the role of the market in distributing resources to a minimum – with all the attendant problems. Secondly, the regime needs to distance itself from an idea of socialism as an authoritarian model that can ignore or even criminalise those whose criticism is intended to make the country’s economy more efficient and its society more democratic, to see its 2019 constitution enacted and establish the rule of law.

A WHOLE NEW MOMENT FOR CUBA

Yet the regime’s reaction to the events of 11 July as communicated official media channels showed no signs of overcoming this tendency. Those who took part in the protests have been discredited and decried as criminal elements – overlooking the specific and legitimate demands made by many in a peaceful manner. This may come back to haunt the regime.

These demonstrations represent a wholly new development for Cuba and make clear just what difficulties the country’s society is facing.

Furthermore, official announcements have sought to justify the use of repressive violence – a message with which many Cubans who, while not directly involved, have observed (and been shocked by) events, strongly disagree. Internationally, Cuba’s image has taken a hit. There is still no clarity about the number of demonstrations or how they played out, how many took part, and how many participants have been placed under arrest. Meanwhile, intellectuals and artists have publicly denounced the regime’s repressive course, with many demanding the release of all peaceful protestors – including such figures as songwriter Silvio Rodríguez, who enjoys a great deal of respect among many in government.

The lack of genuine information is leaving space for disinformation to circulate around both external actors and the country’s population – disinformation spread with the aim of undermining the government. At the same time, Cuban citizens have broadly accepted the precept that peaceful protests are legitimate and should be protected under law. This is a precept with which the government, however, in clear contravention of the principal of a socialist country under the rule of law, does not agree. This is not sending the right message – neither on a domestic nor international level.

These demonstrations represent a wholly new development for Cuba and make clear just what difficulties the country’s society is facing. These difficulties have been further aggravated by a US embargo which continues to impoverish the Cuban population and exert pressure on the country’s government. The current situation represents a stress-test for the Cuban regime, which would do well to remember that, when faced with similar situations, like-minded politicians had more success when they decided to pursue a path of generosity and listen to citizens’ legitimate concerns rather than leaving demands to fall on deaf ears.

The Spanish version of this article appeared in Nueva Sociedad.

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PAVEL VIDAL: «HAY QUE SER CAUTELOSOS CON LAS CRIPTOMONEDAS»

El TOQUE, 27 / agosto / 2021

por Pavel Vidal Alejandro

Articulo Original: Criptomonedas en Cuba?

La RArticulo Originalesolución 215 del Banco Central de Cuba (BCC), recién publicada en la Gaceta Oficial, regula el uso de criptomonedas y otros activos digitales en el sistema financiero nacional. La norma contiene, de manera esencial, lo siguiente:

  1. Concibe el otorgamiento de licencia a proveedores de servicios de criptomonedas y otros activos virtuales para operaciones relacionadas con la actividad financiera, cambiaria y de cobranzas o de pagos, en y desde el territorio nacional.
  2. Prohíbe que las instituciones financieras, las empresas y otras personas jurídicas nacionales operen con activos virtuales y proveedores de estos servicios que no estén autorizados por el BCC. 
  3. No se prohíbe el uso de activos virtuales por parte de las personas naturales al margen del sistema financiero nacional.

A propósito de esta resolución y del uso cada vez más extendido de esta moneda en el archipiélago, vale decir que hay que ser cautelosos con las criptomonedas porque todavía no cumplen a cabalidad ninguna de las tres funciones que usualmente le pedimos a una moneda.

La tecnología que soporta las criptomonedas aún debe perfeccionarse para permitir una mayor cantidad de transacciones por minuto —como lo hacen instrumentos tradicionales de pago con cuentas bancarias o tarjetas de crédito—. Cuando se realiza una transacción con criptomonedas, en ocasiones, se deben esperar horas o días para que esta se refleje en las cuentas o monederos digitales de los usuarios. Por tanto, como medio de pago, aún poseen muchas desventajas en comparación con el dinero bancario tradicional; como unidad de cuenta, también, pues son muy pocos los bienes y servicios que expresan sus precios en criptomonedas.

Para cualquier empresa resulta muy complejo manejar un flujo de caja derivado de operaciones de ingresos y gastos valorados en criptomonedas, a causa de la alta volatilidad de sus tasas de cambio. Debido a esta alta volatilidad en el precio de las criptomonedas, tampoco deberían ser atractivas para emplearse como depósito de reserva o reserva de valor (tercera función que debe cumplir el dinero).

Sin embargo, esta última función —y a pesar de la volatilidad— es la que ha ganado más terreno en el campo de uso de las criptomonedas. Para muchos, sí han constituido una opción de inversión financiera. Es una decisión personal, pero, por lo general, los inversores con una aversión al riesgo baja o moderada, no suelen invertir en activos con tanta volatilidad. Tampoco lo harían porque resulta difícil en esos casos proteger la inversión mediante la diversificación del portafolio y la inclusión de otros activos con los cuales presente una correlación negativa.

Resolución del Banco Central de Cuba sobre criptoactivos: preguntas y respuestas

Los expertos en finanzas han encontrado que es arduo hallar activos que cubran o compensen, dentro de un portafolio de inversión, los riesgos que se corren con la exposición a la volatilidad de las criptomonedas. Para muchos economistas, el incremento excesivo del valor de las criptomonedas posee las características de una burbuja financiera.  

Dicho esto, puedo entender que en el caso cubano las criptomonedas podrían generar beneficios (los cuales deben valorarse junto a las desventajas). Por esa razón, el Banco Central de Cuba decidió autorizar este tipo de operaciones en el sistema bancario y financiero nacional. Sabemos que los actores económicos nacionales —estatales y privados— tienen restricciones financieras asociadas a las sanciones estadounidenses. Estas les impiden maniobrar con normalidad en el sistema financiero internacional. No pueden emplear el dólar estadounidense en los mercados internacionales cuando esa moneda es el principal medio de pago en el comercio global, la unidad de cuenta más recurrida para fijar los precios de las materias primas y los valores de contratos de todo tipo, y la que más se invierte en activos financieros diversos por fuera de las fronteras nacionales.

En síntesis, las criptomonedas todavía presentan varios inconvenientes para reemplazar de manera global al dinero fiduciario y bancario tradicional. Pero, para la economía cubana —analizándola en el escenario financiero inusual en que actúa debido al embargo estadounidense y los altos costos que este le ocasiona—, se entiende que las criptomonedas puedan ser una opción para eludir sanciones y generar beneficios netos.

Las criptomonedas tienen el potencial de generar alternativas financieras para el comercio exterior de Cuba, para los flujos de remesas, y podrían usarse para financiar las pequeñas y medianas empresas desde el exterior. Habrá que ver cómo se desarrollará la infraestructura financiera cubana para hacer operativa la Resolución 215 del Banco Central de Cuba.

TAMBIÉN TE SUGERIMOS:

Comprar bitcóin y otras criptomonedas desde Cuba

Aunque aún son pocas y no tan conocidas las opciones para pagar con criptomonedas desde Cuba, cada día su uso es más frecuente. Te mostramos cómo puedes adquirirlas.

Remesas con criptomonedas: nueva forma de enviar dinero a Cuba

Las criptomonedas no tienen fronteras; están descentralizadas y pueden cambiarse por divisas de valor internacional. Esas es una de las razones por las cuales las remesas con criptomonedas se han convertido en los últimos meses en una forma para enviar dinero a Cuba con menos restricciones.

Pavel Vidal Alejandro: Profesor Asociado del Departamento de Economía de la Pontificia Universidad Javeriana Cali. Doctor en Ciencias Económicas de la Universidad de La Habana. Ha sido investigador invitado en la Universidad de Columbia, Universidad de Harvard, Universidad Complutense de Madrid, Universidad de Oslo y en el Institute of Developing Economies (Japan External Trade Organization).

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CUBA’S LEADER, FACING GROWING CRITICISM, DOUBLES DOWN ON ORDER TO CRACK DOWN ON PROTESTERS

By Nora Gámez Torres

Miami Herald, August 26, 2021 06:55 PM \


Original Article

President Miguel Diaz-Canel

With the world watching as Cubans protested on the streets all over the island on July 11, Cuban leader Miguel Díaz-Canel took what some experts believe was a decision that will come back to haunt him: He gave a “combat order” to fellow revolutionaries to squash those calling for freedom and the “end of the dictatorship.”

In the aftermath of images of police repression and pro-government mobs hitting protesters with clubs going viral, there has been a rare wave of criticism from government insiders, state journalists, and prominent figures in the arts, pointing to a crisis of governance in the communist island that no other leader has faced in six decades.

Diaz-Canel recently told journalists working for state-sanctioned outlets that he doesn’t regret the order to crack down on anti-government demonstrators. But the fact that he felt the need to gather the journalists at a meeting Saturday to justify his decision is the latest example of a damage-control campaign to restore his dwindling popularity and political standing.

“I made a call to the people that day because it seemed to me that it was the right thing to do and that I do not regret or will not regret,” he said in a video of the meeting that was later edited and televised this week. “We had to defend against demonstrations that were not peaceful at all. And that is a false story that they have also put out there.”

But even in the controlled setting of the Palace of the Revolution, and among some of his more staunch defenders, he could not avoid criticism.

A young journalist who works on Editorial de la Mujer, or Women’s Publishing, stood up and told him that political troubles call for “political solutions… not only, or not police actions.”

“President, you acknowledged that apologies should be given wherever an excess was committed,” said Lirians Gordillo. “We also need to tell those stories because nothing can harm this country more than an injustice or an excess that is not recognized out loud.”

A day after his controversial statement on July 11, Diaz-Canel appeared on television to walk back his words and strike a more conciliatory tone. But a month later, his “combat order” and the violent repression that followed, including hundreds of documented detentions and summary trials, are still causing him trouble.

Sweating despite the air conditioning at the Palace of the Revolution and stumbling over his words a couple of times, the leader acknowledged Saturday that there might have been “some excesses.” He said those cases would be investigated but denied that there are protesters who are “disappeared or have been tortured.”

Amnesty International, Human Rights Watch and Cubalex, all human-rights organizations tracking the arrests, have documented cases of mistreatment and protesters whose whereabouts are still unknown.

“Díaz-Canel has lost all credibility,” said a source close to the Cuban government who asked not to be identified for fear of retaliation. “That day he appeared on TV and said what he said, all hopes among the younger generations that he would be a reformer were destroyed in 20 minutes. And from then on, he has continued to screw up.”

Shortly after images of the violence spread on social media, prominent Cuban musicians and other members of the island’s artistic community, including Leo Brouwer, Adalberto Alvarez, Elito Reve and members of the legendary band Los Van Van, posted candid criticism on social media.

Brouwer said he never imagined that security forces would attack peaceful Cubans.

“Impossible to be silent,” said Alvarez. “The beatings and the images I see of the violence against a people that took to the streets to peacefully express what they feel hurt me.”

“The streets in Cuba belong to the Cubans. I can not do less than be by your side in difficult times,” he wrote on Facebook.

In a stunning rebuke of Díaz-Canel’s response to the crisis, a former Cuban ambassador who frequently defends the government’s views on foreign media said Cuban authorities could not ignore its citizens’ legitimate demands.

Carlos Alzugaray, a former ambassador to the European Union, wrote an opinion column criticizing the government’s “clampdown” on protesters “so repressively, while pursuing the same endless propaganda communication strategy as ever despite its demonstrably diminishing returns.”

While he repeated the government line that the U.S. embargo is the source of Cuba’s economic troubles, he added they were “in no small part also the result of governmental inadequacy and poor policy.” And, he added, the Cuban government was “proclaiming that ‘the embargo is the problem’ and talking down the protests as ‘interference from outside’ in an effort to cover up its own errors.”

The message, however, does not appear to be getting through at the top levels of the Cuban government.

Last week, the government published a draconian law to criminalize expressing dissenting opinions on the internet. Diaz-Canel seems to be on a personal crusade against social media, which he called a “colonial tool” that promotes hate.

The Cuban leader has not been treated kindly by his fellow Cubans on social media, where he is constantly derided, when not made the butt of jokes and memes. A vulgar insult repeated by thousands of people during the demonstrations has now become attached to his name on Google search.

After Raúl Castro picked him to succeed him in 2018, Diaz-Canel has faced one crisis after another. Widespread shortages and blackouts, and controversial decisions like selling food in U.S. dollars that the population does not earn, have made him an unpopular figure and the target of the demonstrators’ anger.

From the beginning, his position has been tenuous. As a non-Castro, he doesn’t have the credibility of the so called históricos, those who fought for the revolution in the 1950s in the Sierra Maestra mountains. But he still needs to cater to Communist Party hardliners. And he is expected to carry out long-delayed reforms like the currency unification that has angered ordinary Cubans even more.

“He might as well become a one-term president, since he was left all the ugly stuff to make the country survivable” in financial terms, said John Kavulich, the president of the US-Cuba Trade and Economic Council.

Still, Diaz-Canel was named the Party’s First Secretary in April this year, after Raul Castro’s official retirement, a powerful position he could have used to stop the repression of protesters “if he had the will,” the source close to the island’s government said.

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FROM DRIED FRUIT TO BIKE REPAIR, CUBAN ENTREPRENEURS PREPARE FOR A MORE OPEN ECONOMY

By Marc Frank and Anett Rios

Original Article: , Cuban Entrepreneurs Prepare for a More Open Economy

HAVANA, Aug 27 (Reuters) – Cuban entrepreneurs, running businesses ranging from selling dried fruit to repairing bikes and developing software, are scrambling to understand the opportunities and challenges ahead after a landmark change in the rules governing the Communist-run economy.

Earlier this month, the government released regulations about a reform that would allow small- and medium-sized ventures to formally incorporate as businesses and access state financing, ending decades of classifying them as ‘self-employed’.

The measure is seen by many analysts as one of the most important reforms undertaken since all businesses – down to shoe-shine boys – were nationalized in 1968 by former leader Fidel Castro.

Omar Everleny, one of Cuba’s best-known economists, described the reform as a very positive one, long-sought by many Cubans.  It does have important limits – for instance, people can own no more than one business and cannot contract foreign partners or carry out direct foreign trade.  “Given the economic situation and remaining restrictions, it will not mean a big economic improvement in the short term,” cautioned Everleny.

For Nayvis Diaz, founder of Velo Cuba, a bicycle repair and rental company with 17 employees in Havana, it marks a significant change, however.  “What is important is we are now fully part of the economy and no longer marginalized,” she said.  “Many people with a lot of social and business responsibilities in the city, and many others in the private sector, were waiting for this.”

The measure forms part of a package of market-oriented reforms undertaken by Cuban President Miguel Diaz-Canel over the last year, as the coronavirus pandemic and tougher U.S. sanctions tipped the shaky economy into a tailspin and led to shortages of food, medicine and other basic goods.

Cuba’s economy contracted by 10.9% in 2020 and shrank another 2% this year through June, compared with the same period in 2020. It remains reliant on tourism and imports.

The Fernandez brothers, who own Deshidratados Habana, Cuba’s only company processing and selling dried fruits, were nevertheless enthusiastic.  Nayvis Dias (C), founder of Velo Cuba, speaks to employees at her bicycle repair and rental company in Havana, Cuba, August 25, 2021. REUTERS/Alexandre Meneghini    “A bad economy can present opportunity,” Oscar Fernandez said, standing amid makeshift ovens and other equipment in his basement. The company began when the pandemic forced their cafeteria to close, he explained.

THE HORIZON HAS OPENED

Hundreds of small businesses have found niches in a state-dominated economy short on imagination and initiative: from gourmet restaurants and 3D-parts manufacture to software development, home delivery, landscaping and construction contracting.

The private sector, excluding farmers, has expanded since the 1990s to encompass more than 600,000 self-employed license holders. It includes small-business owners, non-agriculture cooperatives, their employees and members, tradespeople and taxi drivers.

The Fernandez family business sells dried fruit online and has placed their product at three upscale private food shops in Havana.  “The horizon has opened,” said Oscar, who holds a doctorate in economics. “Once incorporated we can establish relations with state and private supply chains and market our product to whomever – from state-run stores to hotels, as well as export and seek financing from local banks or abroad.”

Diaz, in her workshop crowded with bicycles, was also enthusiastic about the prospects for growth, adding that she would be cautious and consult her lawyer and accountant every step of the way.  “We have to analyze the economic context closely because we will have an increasing responsibility with all the people that we are going to hire in our companies,” she said.

The Fernandez brothers have drawn up plans for a small factory that would process a ton of fruit daily, including for export. They dream of owning a store that sells their products.  “We have the land and suppliers lined up. We just need about $100,000 in financing,” Oscar said.

But one major worry remains – one shared by many Cubans on social media.  “We still have to see what happens in practice: how far the government really allows us to develop,” Ricardo Fernandez said.

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PROTESTS IN CUBA: THE BEGINNING OF A NEW REVOLUTION?

Interview with Silvia Pedraza

University of Michigan, Michigan Today

July 20, 2021.

Original Article: Protests in Cuba

Faculty Q&A

The protests calling for “Fatherland and Life” in Cuba have been met with military tanks and censorship by the Cuban government. U-M sociologist Silvia Pedraza says the protests are the result of a perfect storm that includes the coronavirus pandemic, the lack of a charismatic leader, the deep financial crisis unleashed by changes in the currency, and greater access to the internet in recent years.

Originally from Cuba, Pedraza seeks to understand the causes and consequences of immigration as a historical process that forms and transforms nations. A professor of sociology and American culture, she is the author of several books, including Political Disaffection in Cuba’s Revolution and Exodus (Cambridge University Press, 2007) and co-author of the forthcoming Revolutions in Cuba and Venezuela: One Hope, Two Realities (University of Florida Press, under contract).

Dr. Silvia Pedraza

What is “Patria y Vida” and why is it relevant to the protests?

Current protests in Cuba are calling for “Patria y Vida” (Fatherland and Life), the title of a recent rap song by young, Afro-Cuban dissident artists, that has become the banner of the protest movement. The song was created by rappers both on the island and in Miami — Luis Manuel Otero-Alcántara, Maykel Osorbo and Yotuel, among others. It takes off from Fidel Castro’s motto of “Patria o Muerte” (Fatherland or Death), insisting that the Cuban government should provide its citizens with a decent life and liberty, as has been denied for over 60 years. This song is a continuation of the San Isidro movement that erupted last Nov. 27, 2020, when hundreds of artists and other mostly young people sat in front of the Ministry of Culture for days, demanding a real dialogue with the Cuban government and real participation in the country’s political life. President Miguel Díaz-Canel denied them both, calling the dissenters “mercenaries” and blaming the protests on the U.S. embargo. Now the protests of thousands of people in many cities across the full length of the island are being met with military tanks and repression as the government insists “the revolution” must be preserved.

What has led to the current protests in Cuba?

We are seeing a number of completely different factors that have come together, creating a perfect storm. One of these factors is certainly the continuation of the U.S. embargo, but that is an old ingredient Cubans have adjusted to, so it can’t be said to be the cause of what is happening right now.

In January 2021, Cuba underwent a drastic reform of its financial life as it did away with the old currency it imposed many years ago, the CUC, and returned to the old Cuban peso overnight. The result was a spiraling inflation of prices that left Cubans unable to buy food or medicine, when they were hungry and ill. In the last decade, the Cuban economy has declined steeply, contracting by -11% GDP growth last year. At present, Cuba imports food and exports little. The pillars of Cuba’s economy are international tourism, Venezuela’s oil, and remittances from the émigrés. Recently, all three have declined to the point where they no longer hold up the island’s economy.

Before, events where the people rebelled against the government happened in different parts of Havana, for example, but nobody else knew what had happened so it never triggered a collective response. Now, we see that knowledge of what others are doing is widely shared and it has triggered a collective response. As a result, the Cuban government cut off the internet for some days.

The new ability that Cubans found in the last three years or so to get onto the internet, to see how the rest of the world lives, and to communicate among themselves with ease (none of which was ever possible before), is quite an important ingredient. Before, events where the people rebelled against the government happened in different parts of Havana, for example, but nobody else knew what had happened so it never triggered a collective response. Now, we see that knowledge of what others are doing is widely shared and it has triggered a collective response. As a result, the Cuban government cut off the internet for some days.

Former President Trump also left in place some sanctions that have made a difference. For example, Trump did away with Western Union offices in Cuba. Now Cubans who live in poverty inside the island can no longer rely on the help from their family in Miami, throughout the United States, in Latin America, and Spain. Until just a few months ago, the family overseas sent money, clothing, medicines, and food. Now, Cubans whose lives are very precarious cannot rely on their family abroad to buoy them up.

The pandemic also has made a difference. The impact the coronavirus has had on society has been profound — not only in Cuba but also in the United States, India, and Brazil. Not only has it killed many people, but people can see the government’s lack of capacity to deal with a very serious problem. The problem has not gotten better but has gotten much worse to the detriment of everybody in the population. Thus, no one believes that the government can be counted on to really help them.

The Cuban people are tired of communism — so many beautiful promises, so little delivered. I honestly believe that we are possibly seeing the beginning of a revolution in Cuba, another revolution after 62 years.So all of these things have come together and there is a perfect storm going on in Cuba. It could end in a massive exodus, but I am not expecting it to. People are not saying, “I want to leave this country and get out of here and make a new life somewhere else.” What they are saying is,  “We want a different government. We want real democracy in this country. This is our nation. This is our fatherland. This is our motherland. Look at the signs people are holding up, saying: ‘Patria y Vida.’ Listen to what they are shouting: ‘Libertad (Freedom).’”

This could be the beginning of another Cuban revolution because it is not just about economics or just about the exodus. Now, it is about the political structure of the country. The problem is the government, which is not responsible to its citizens. The Cuban people are tired of communism — so many beautiful promises, so little delivered. I honestly believe that we are possibly seeing the beginning of a revolution in Cuba, another revolution after 62 years.

What other factors have influenced this wave of protests that we have seen in Cuba?

When the communist world collapsed in the early 1990s and something similar happened, when the economy contracted by -35% of GDP in three years and Cubans experienced great hunger, Fidel Castro, with his great skill and charisma and “lip service,” as they say in Cuba, called it “a special period” during a time of peace. People don’t want to experience this twice.

Donald Trump did away with Western Union offices in Cuba. Now Cubans who live in poverty inside the island can no longer rely on the help from their family in Miami, throughout the United States, in Latin America, and Spain. Until just a few months ago, the family overseas sent money, clothing, medicines, and food. Now, Cubans whose lives are very precarious cannot rely on their family abroad to buoy them up. Second, Fidel Castro, with his charisma and oratory skills, is not there. Raúl Castro is already very old and never had that charisma, though he did usher in some good reforms for the people. And Cuban President Miguel Díaz-Canel is not a leader who has reached the minds or hearts of the people, and I do not think he has much administrative capacity either because it is already seen that his response to the protests has been repression.

Social scientists often wish they could separate the impact of one variable from another in predicting a particular outcome, so we could say that this was due to the currency exchange or to Trump’s sanctions or to the coronavirus or to the dwindling help from Venezuela. But the reality is that it is due to all of this having come together, in a historically contingent manner.

What has been the contribution of the U.S. embargo to the crisis?

The embargo has been eased since 2000, when Congress voted to do so, given the tragedy of family separation that took place around the small boy, Elián González, the youngest balserito (rafter) to be rescued at sea. Since then, the U.S. is a major trading partner for Cuba. The United States sells cereals and grains to Cuba, from the Western states. It sells chickens from the Carolinas and turkeys from Michigan and some medicines.

Trump imposed very strong sanctions against Cuba. President Biden could have easily removed them, but he hasn’t. New Secretary of State Antony Blinken said that neither Cuba nor Venezuela was a priority for the administration. It is up to Congress to ease the embargo further, and I think they should, as it has not been able to topple the Cuban revolution but has, rather, been counterproductive. One can see Cuba’s president now blaming all that is happening on the embargo — as they have consistently done. That is what counterproductive means. The Cuban government is going to try to blame everything on the United States embargo, but it is no worse now than before. More serious is that Donald Trump destroyed the ability of the Cuban exile to help their family on the island, to keep them afloat.

Trump imposed very strong sanctions against Cuba. President Biden could have easily removed them, but he hasn’t. New Secretary of State Antony Blinken said that neither Cuba nor Venezuela was a priority for the administration. So if anything will result from these protests, it is that they may well make Cuba, and perhaps Venezuela, a priority for Biden. I hope so.

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CHANGES IN CUBAN SOCIETY SINCE THE NINETIES

Wilson Center Reports on the Americas No. 15: Changes in Cuban Society since the Nineties

By  Joseph Tulchin, Lilian Bobea, Elizabeth Bryan and 2 more

Complete Report: Changes in Cuban Society since the Nineties

This book aims to provide academics, policymakers, NGOs and the media in Cuba, Latin America and North America, with a better understanding of the changes in Cuban civil society since the collapse of the Soviet Union and their implications in the areas of research, academic and literary production, and public policy. It presents and assesses critically the changes that have taken place in Cuban society, economy, politics, and culture as Cuba emerges from the crisis of the 1990s.  This volume also aspires to contribute in a meaningful way to the political debate in the United States and to the dialogue between the United States and Cuba.  It brings together contrasting perspectives marked by occasionally opposing views from both within and outside the island.  It is the result of a seminar held in the Dominican Republic in December 2003 under the auspices of the Latin American Program of the Woodrow Wilson International Center for Scholars and the Facultad Latinoamericano de Ciencias Sociales, with the generous contribution of The Ford Foundation.

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Center for Democracy in the Americas’ STATEMENT: CDA URGES THE BIDEN-HARRIS ADMINISTRATION TO TAKE ACTIONABLE STEPS TO REMOVE SANCTIONS WHICH IMPEDE ITS OWN POLICY OBJECTIVES

Center for Democracy in the Americas, Washington D. C., August 3, 2021

ORIGINAL ARTICLE

WASHINGTON – In response to the ongoing situation in Cuba that began with protests on July 11 throughout the island, and the subsequent announcements made by the Biden-Harris administration, Jorge Quintana, executive director of the Center for Democracy in the Americas, released the following statement:

“In the wake of the July 11 protests in Cuba and following six months of inaction on the Cuba policy front, the Biden-Harris administration has finally signaled its intention to engage with the issue. However, while recent statements from the Administration convey support for the Cuban people, current policy is not only incompatible with those sentiments, but counterproductive to them. If the Administration truly wishes to support the Cuban people, it will need to first take concrete actions to remove sanctions that serve to stymie this support. The Biden-Harris administration should stop serving as a roadblock and start serving as a conduit. I urge the Administration to take immediate action toward implementing policies of engagement that benefit the Cuban people. Engaging with a community that continues to suffer the effects of a strenuous diplomatic relationship should be a priority of the United States.
 
Human rights are universal, and the Cuban people deserve to speak freely without fear of retribution and to have a voice in their future. This will happen when Cuba’s government listens to the voices of its people and respects their right to peacefully protest. Protesters throughout Cuba were met with violent confrontation from Cuba’s security forces while calling for an improved COVID-19 response, and relief from food, medicine, electricity and good shortages. Some also called for changes to the island’s economy and for political change. Cuba’s government responded to the demonstrations by preventing internet access to many websites and social media platforms, and with the arrest, detention, and/or disappearance of reportedly more than 700 protesters, activists, and independent journalists thus far. Protesters should not be punished for exercising their rights as set forth in Cuba’s updated 2019 constitution, which include the right to due process in legal proceedings and the right to freedom of assembly. For those protesters who engaged in violence or the destruction of property, prosecutions must be open, transparent, and with guarantees of due process. Cuba’s government has an opportunity, at this critical moment, to steer away from its response of repression and to convene and listen to groups of civil society actors in good faith, actualize the economic changes that have been promised, and respond to the concerns of the Cuban people with openness.
 
While the protesters’ calls were directed at internal grievances and not directly at U.S. sanctions or the U.S. embargo, the U.S. can help facilitate this internal change through lifting sanctions and removing the embargo. Once again, I call on the Biden-Harris administration to prioritize the humanitarian situation in Cuba by suspending regulations that inhibit the flow of humanitarian aid. Specifically, I call on the Administration to remove the specific licenses required to send medical supplies to Cuba, lift restrictions on the percentage of U.S.-made material used in foreign produced medical supplies, remove end-use verification for humanitarian imports, lift restrictions and caps on family and donative remittances, lift restrictions on banking, and remove travel restrictions that prevent this robust and dynamic form of diplomacy from taking place and prevent the Cuban people from receiving necessary humanitarian supplies.
 
The Biden-Harris administration should restore remittance channels, thereby allowing Cuban-Americans to exercise their right to send, or not send, remittances, which help support Cuba’s private sector and offer much-needed start-up capital from relatives abroad. The Administration should not, however, view remittances as an end-all-be-all to financial support. Many protesters on July 11 were Afro-Cuban, who tend to have less family abroad and less access to remittances. The Administration’s newly announced Remittance Working Group will expedite a review of how to send remittances directly to the Cuban people, bypassing Cuba’s government. As it considers this, it should take into account that Cuba’s government no longer captures the amount of revenue from remittances as it has in the past. Since July 2020, Cuba no longer taxes dollar remittances or requires Cubans to convert dollars to local currency, and has significantly decreased hard currency store markups. Much of the government’s revenue from remittances captured from hard currency store sales is channeled to food, fuel, and goods imports. The Remittance Working Group is rightfully operating under a deadline. The Group should be judged on its ability to answer operational issues that serve the goals of supporting small and medium sized enterprises, improving the standard of living of Cuban families, and respecting the rights of Cuban-Americans to support their families.
 
The Administration has expressed interest in exploring ways to support free and effective internet access in Cuba. Images, videos, and accounts of the July 11 protests shared by Cubans on social media were largely made possible by increased internet availability on the island and the introduction of 3G and 4G which occurred over the past few years. Nearly half of the island’s population has a cell phone and 2.5 million have 3G or 4G access. However, internet outages following the protests, allegedly initiated by Cuba’s government, have sparked concern. The Biden-Harris administration does not need to start at square one. The Administration should re-examine the 2019 Cuba Internet Task Force recommendations, including facilitating the export of telecommunications equipment and infrastructure, promoting technological literacy and digital safety education, promoting exchange programs, and empowering local, organic, network growth. Though the telecommunications environment has changed, many of the challenges and opportunities remain the same. It is important that Cuban citizens themselves have both access to and autonomy over their internet. Efforts to weaponize the internet, to use it for the spread of disinformation, or to censor it by any government should not be tolerated.
 
Additionally, the Administration should expedite its review of restaffing the U.S. Embassy in Havana and reinstating consular services, including visa processing and the Cuban Family Reunification Program. Regardless of future actions on the part of Cuba’s government, a fully staffed embassy will allow the U.S. to provide critical support to Cuban civil society, monitor the situation on the ground, initiate a human rights dialogue with Cuba’s government, and advocate against arbitrary detentions.
 
The policy of hostility and isolation is not improving democracy or human rights on the island; rather, it is politicizing a humanitarian crisis and distracting from dynamic and actionable solutions. In order to remedy the inherent disconnect between supportive messaging and punitive policy in the Administration’s response to the current crisis in Cuba, the Biden-Harris administration must change the role that U.S. policies and sanctions have in contributing to the crisis by pursuing a policy of engagement. Engagement is the best way to alleviate the hardships faced by the Cuban people, advance U.S. interests, offer an opportunity for dialogue and cooperation on a wide range of issues, from human rights to national security, and to allow the necessary conditions for Cubans to determine their own future.
 
Pursuing a policy of engagement and removing the current counterproductive policies that only serve to compound hardships faced by Cubans, would allow President Biden to stand with the Cuban people while continuing to condemn any repression of human rights in Cuba. It’s time for the U.S. to support the Cuban people in both spirit and in practice.

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CUBA STUDY GROUP STATEMENT ON THE JULY 30 MEETING BETWEEN PRESIDENT BIDEN AND CUBAN AMERICAN LEADERS

Contact: Ricardo Herrero
Phone: 202-709-8191

August 2, 2021

WASHINGTON D.C. — On July 30th, the Executive Director of the Cuba Study Group, Ricardo Herrero, was among eleven Cuban American leaders invited to meet with President Biden to discuss his administration’s response to the situation in Cuba in the wake of the historic July 11th protests.

We thank the President for his time, for the opportunity to share our views, and for his administration’s commitment to the Cuban people by addressing the island’s ongoing crisis through a “whole-of-government approach.” We encourage his administration to continue to respond to recent events with a sense of urgency and look forward to the prompt reopening of remittance flows, the expansion of internet access and the restaffing of the U.S. Embassy in Havana.

We also commend the Biden administration for levying targeted sanctions on those responsible for the repression of peaceful protesters on, and since, July 11th. Targeted sanctions against Cuban government officials send a strong message that their human rights abuses will not be tolerated, even if their practical effect is blunted by the blanket sanctions of the U.S. embargo that already make it unlikely that Cuban officials have significant assets in the United States.

Yet, as the Biden administration seeks to hold the Cuban government accountable, we can and must do more to empower the Cuban people. In fact, we maintain that strengthening the Cuban people, more so than punishing their government, is the key to meaningful change in Cuba.

This is why we ask the Biden administration to empower the American and Cuban American private and NGO sectors to be the driving force in extending support to the Cuban people at this precarious juncture. Not only is it often more efficient to enable private actors to lead the way, but it also undermines the Cuban government’s Cold War-era narrative that their struggle is against the U.S. government, when the truth is that their present-day struggle is with their own people, both at home and abroad.

Covid-related assistance from the United States can help save lives and stem a pandemic that has overwhelmed the Cuban healthcare system. To that end, we ask the Biden administration to lift all restrictions and licensing requirements on donations of food, medicine, and medical supplies to Cuba, thus enabling churches and other NGOs to quickly mobilize.

Secure internet access is indeed crucial to providing Cubans with the unfettered flow of information they deserve and the tools to mobilize for peaceful change. However, there are immediate, practical steps the U.S. government can take to improve the quality of internet access on the island. These include allowing U.S.-based firms to provide cloud-based services like online payment processing and subscription-based platforms in Cuba. Not only are they powerful tools for private sector and civil society development; they also can help get money—including remittances—directly into the hands of the Cuban people.

Finally, open travel remains the best way for Cuban Americans and Americans to serve as ambassadors of our values and provide direct assistance to the Cuban people. Thus, we ask the Biden administration to reinstate travel to all airport destinations in Cuban provinces as Covid-19 restrictions allow.

Ultimately, the best way to “stand with the Cuban people” is for Americans and Cuban Americans to be present on the ground in Cuba. We look forward to an ongoing, fruitful dialogue with the Biden administration in which we intend to continue pressing this case.
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The Cuba Study Group is a non-profit, non-partisan organization, comprised of business and professional individuals with a deeply rooted love for Cuba and the Cuban people. We aim to put our collective experience in leadership skills, problem solving, and wealth creation at the service of the Cuban people. We aim to facilitate change, help empower individuals and promote civil society development.
 
Our mission is to help facilitate peaceful change in Cuba leading to a free and open society, respect for human rights and the rule of law, a productive, market-based economy and the reunification of the Cuban nation.


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124 ACTIVIDADES PROHIBIDAS PARA EL TRABAJO POR CUENTA PROPIA EN CUBA / 124 SETS OF ECONOMIC ACTIVITIES PROHIBITED FOR THE PRIVATE SECTOR

El Toque Feb  10, 2021

Complete Listing: from El Toque

Complete listing in PDF format


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