• 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."

Raul Castro Says Economic Reforms Are Working

Posted on December 14, 2012 by Arch Ritter
By By PETER ORSI Associated Press
HAVANA December 13, 2012 (AP)

President Raul Castro, December 13, 2012

 President Raul Castro declared Thursday that Cuba’s two-year experiment with market reforms is working and has the wind at its back, but said much work remains to breathe life into the sputtering economy.

In a speech devoid of any new policy announcements, the military khaki-clad leader sounded a generally positive tone in discussing the Marxist country’s progress, though he conceded that the island faces a “colossal psychological barrier” in shedding old habits and “concepts of the past.”

“The updating of the Cuban economic model … marches with a sure step and is beginning to delve into questions of greater reach, complexity and depth,” Castro said, according to an official transcript of his remarks before lawmakers at the second of their twice-annual sessions.

The proceedings were closed to foreign journalists, but state television later broadcast tape-delayed highlights.

Cuban economy czar Marino Murillo told the assembly that the government is planning more measures to support and increase the ranks of independent workers and small business owners.

Real estate broker, delivery person, antiques dealer and produce vendor will all be newly legalized private jobs in a country where the government has long dominated the economy and employed nearly the entire workforce.

The self-employed “are gaining space,” Murillo was quoted as saying by the Cuban news agency Prensa Latina.

Economists have said Cuba needs to expand the number of allowable private enterprises, with an emphasis on white-collar work. Real estate has been a particular concern. Cuba legalized the buying and selling of property 12 months ago, but has yet to allow agents to facilitate transactions.

Some 400,000 people now work in the private sector in 180 legally approved job areas, Prensa Latina said. That’s up from 156,000 in late 2010, the onset of Castro’s five-year plan to reform the economy with a dash of free-market activity.

Cuba intends to keep control of key sectors, however, and Castro and other top officials insist the country is not abandoning a half-century of socialism for freewheeling capitalism.

Murillo also said that in the future, state-run businesses including tourism concerns will be paying independent contractors via bank transactions in hard currency.

Meanwhile, lawmakers passed a 2013 budget with a deficit of 3.6 percent of GDP and heard an update on the country’s economy.

The government announced recently that GDP rose 3.1 percent this year, below expectations of 3.4 percent. Growth of 3.7 percent is forecast for 2013, low for a small developing economy, but Castro called it “acceptable in a scenario of continuing global economic crisis.”

Economy Minister Adel Izquierdo said the construction sector is expected to expand 20 percent in the coming year, worker productivity should rise 2.6 percent and the country has a goal of topping 3 million tourist visits for the first time, according to Prensa Latina.

In its first order of business, the assembly unanimously passed a resolution of support for Venezuelan President Hugo Chavez, who earlier this week underwent his fourth cancer-related surgery in the Cuban capital.

Chavez is a key ally of Cuba, and during his presidency Venezuela has sent billions of dollars’ worth of oil to the island on preferential terms.

“At this crucial hour for Venezuela … we will be like always,” Castro said, “together with President Chavez and the Bolivarian Revolution he leads.”

The unicameral parliament will reconvene in February with a new membership following elections and is then expected to name Castro to another five-year term.

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New Co-op Laws In Cuba

Posted on December 12, 2012 by Arch Ritter

Co-op Laws In Cuba Are Seen As Progress (Cave, NYT)

Wednesday, December 12, 2012

New York Times

By Damien Cave

MEXICO CITY – The Cuban government authorized a wide range of co-ops on Tuesday, allowing workers to collectively open new businesses or take over existing state-run businesses in construction, transportation and other industries.

The new laws published Tuesday are the latest step in a slow, fitful process of opening Cuba’s economy to free-market ideas. The latest announcement calls for the creation of more than 200 co-ops as part of a pilot program. If it grows, analysts said, the experiment could do more for economic growth and productivity than earlier efforts to allow for self-employment, or to reform agriculture.

Co-ops that are run independent from the government could shift a large portion of the island’s economy to free-market competition from government-managed socialism, analysts contend, a change from earlier co-op efforts within state-run agriculture.

“The potential is large,” said Richard E. Feinberg, a professor of international political economy at the University of California, San Diego. “The Cubans are looking for something in between the old state-owned enterprise and a pure free market. Cooperatives are an answer, so looking forward, they could play a significant role.”

For some Cubans, the new laws will just legalize what is already going on in the black market. But the government also seemed interested in encouraging consolidation among small entrepreneurs. The new laws call for lower tax rates for co-ops than for self-employed workers. That means barbers or fishermen or carpenters who now work as individuals will have an incentive to join co-ops, companies in which each worker has a vote.

The new laws also say that co-ops can be formed with as few as three people, and that in addition to converting state businesses into co-ops – with first preference given to workers already there – co-ops will be able to bid for leases of idle government properties.

The co-ops “will not be administratively subordinated to any state entity,” the government said in a summary of the laws in Granma, the state-run newspaper. But the government will play a large role in determining who gets the chance to open businesses. Workers seeking to start co-ops must submit applications that go to local government offices that pass them up to the Council of Ministers, which includes President Raúl Castro, for approval.

It is not yet clear whether higher-skilled professionals, like architects or doctors, will be able to form co-ops. Philip Peters, a Cuba expert at the Lexington Institute, a nonpartisan policy group, said that initially the co-ops would probably fill a gap in basic services, like transportation for farm products. He predicted co-ops would most likely reduce the likelihood of theft.

“People pilfer from the state; they don’t from a business in which they have a stake,” he said. But to fully reach the co-ops’ potential, he and other experts said, questions about the government’s interaction with them will need to be answered.

“They have not been liberated overnight from operating in the Cuban context,” said Professor Feinberg, who was an adviser to the Clinton administration. “How do they get credit? How do they get inputs? How are workers going to be properly trained? How will management be properly trained? These are all outstanding issues.”

 

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Cuba cracks down on dissidents on Rights Day

Posted on December 11, 2012 by Arch Ritter

By Juan O. Tamayo, from the Nuevo Herald, December 11, 2012

Original Article here: “Cuba cracks down…..”
Cuban police have detained more than 100 dissidents and put another 100 to 150 under house arrest in an island-wide crackdown to block any gatherings marking International Human Rights Day on Monday, according to government opponents.
Among those detained were about 80 members and supporters of the Ladies in White, including dozens who were reportedly carted off roughly during roundups in Havana and on their way to the Our Lady of Charity Basilica in the eastern town of El Cobre.
Security agents also sealed off several homes in eastern Cuba to avert gatherings of dissidents to mark the 60th anniversary of the Universal Declaration of Human Rights, said Jose Daniel Ferrer Garcia, head of the opposition Cuban Patriotic Union.
The U.S. government swiftly denounced the arrests, saying it was “deeply concerned by the Cuban government’s repeated use of arbitrary detention and violence to silence critics, disrupt peaceful assembly and intimidate independent civil society.”
“We call on the Cuban government to end” the arrests and violence “and we look forward to the day when all Cubans can freely express their ideas,” State Department spokesperson Victoria Nuland said Monday.
Cuban police and State Security agents usually round up scores of dissidents on or before Dec. 10 each year to keep them from staging any sort of events marking the day. The government critics are then released after a few hours or days.
About 45 Ladies in White and 10 supporters were arrested in Havana following their traditional march outside the Santa Rita church after Sunday mass, said Elizardo Sanchez Santa Cruz, head of the Cuban Commission for Human Rights and National Reconciliation.
The women usually are allowed to go home without incident after the marches, but this weekend were harassed by government agents. When they sat down in protest, police dragged them roughly to three waiting buses, Sanchez said. Most were released by Sunday night.
Ferrer said another 34 Ladies in White and two young girls were detained, 16 of them “with violence,” over the weekend around eastern Cuba as they tried to make their way to El Cobre to pray for human rights. All had been freed as of noon Monday.
Police intercepted three more at the gates to the church on Sunday and tried to seize two others already inside, Ferrer told El Nuevo Herald by phone from his home in the nearby town of Palmarito de Cauto. But a priest in the church protected the women and drove them home after the mass.
The Ladies in White, founded by the wives, daughters and mothers of political prisoners, was awarded the European Parliament’s Sakharov Prize for Freedom of Thought in 2005. They wear white clothes and carry pink gladiolas during their marches.
Another 20 male dissidents were taken into custody and held in police lockups around eastern Cuba over the weekend, Ferrer added. Four were confirmed to have been freed as of noon Monday but there was no word on the fate of the others.

Ladies in White

Sanchez added that police and state security agents also put between 100 and 150 dissidents under house arrest during the crackdown, but stressed that he was still receiving new reports of arrests and releases as of Monday evening.
A blog widely believed to be run by State Security agents, Yohandry’s Blog, claimed that police were forced to drag away the Havana Ladies in White before civilians nearby could give them a “forceful reply” for “failing to respect the pain of the Cuban people” over the health of Venezuelan President Hugo Chávez.
Chávez announced Saturday that he was returning to Cuba for a fourth round of surgery related to his fight with cancer. He arrived Monday.
The opposition group Express Art for Freedom, meanwhile, announced a contest, open to island residents only, for the best Tweet regarding International Human Rights Day. The winner, who will pick from among a computer, a camera or a cellular telephone, will be announced after Dec. 23.
And in Spain, two Cuban groups marched to the Cuban embassy in Madrid on Sunday to protest the detentions and demand the release of Sonia Garros and Calixto Ramon Martinez, dissidents who have been jailed on the island for several weeks.

Jose Daniel Ferrer Garcia

Elizardo Sanchez Santacruz

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Richard Feinberg: The New Cuban Economy What Roles for Foreign Investment?

Posted on December 10, 2012 by Arch Ritter

A new study by Richard Feinberg on direct foreign investment in the Cuban context has just been published by the Brookings Institution.  This is the best recent study on the topic and is well worth a read. The Introduction and the recommendations that are relevant for the Cuban Government are presented below.

The complete report is located here:  Feinberg, The New Cuban Economy, What Role for Foreign Investment 2012

1. Introduction

The Cuban revolution defined itself in large measure in terms of what it was not: not a dependency of the United States; not a dominion governed by global corporations; not a liberal, market-driven economy. As the guerrilla army made its triumphal entry into Havana and the infant revolution shifted leftward, a hallmark of its anti-imperialist ethos became the loudly proclaimed nationalizations of the U.S.-based firms that had controlled many key sectors of the Cuban economy, including hotels and gambling casinos, public utilities, oil refineries, and the rich sugar mills. In the strategic conflict with the United States, the “historic enemy,” the revolution consolidated its power through the excision of the U.S. economic presence.

For revolutionary Cuba, foreign investment has been about more than dollars and cents. It’s about cultural identity and national sovereignty. It’s also about a model of socialist planning, a hybrid of Marxist-Leninism and Fidelismo, which has jealously guarded its domination over all aspects of the economy. During its five decades of rule, the regime’s political and social goals always dominated economic policy; security of the revolution trumped productivity.

Fidel Castro’s brand of anti-capitalism included a strong dose of anti-globalization. For many years, El Comandante en Jefe hosted a large international conference on globalization where he would lecture thousands of delegates with his denunciations of the many evils of multinational firms that spread brutal exploitation and dehumanizing inequality around the world. Not surprisingly, Cuba has received  remarkably small inflows of foreign investment, even taking into account the size of its economy. In the 21st century, the globe is awash in trans-border investments by corporations, large and small. Many developing countries, other than those damaged by severe civil conflicts, receive shares that significantly bolster their growth prospects.

The expansion of foreign direct investment (FDI) into developing countries is one of the great stories of recent decades, rising from $14 billion in 1985 to $617 billion in 2010.1 While FDI2 cannot substitute for domestic savings and investment, it can add significantly to domestic efforts and significantly speed growth.

Today’s ailing Cuban economy, whose 11.2 million people yield the modest GNP reported officially at $64 billion3 (and possibly much less at realistic exchange rates), badly need additional external cooperation— notwithstanding heavily-subsidized oil imports from Venezuela. As with any economy, domestic choices made at home and by Cubans will largely determine the country’s fate. Yet, as Cubans have been well aware since the arrival of Christopher Columbus, the encroaching international economy matters greatly; it can be a source of not only harsh punishments but also great benefits.

In the Brookings Institution monograph Reaching Out: Cuba’s New Economy and the International Response, I explored the modest contributions already being made by certain bilateral and regional cooperation agencies and the larger potential benefits awaiting Cuba if it joins the core global and regional financial institutions—namely the International Monetary Fund, the World Bank, the Inter- American Development Bank, and the Andean Development Corporation.

This sequel explores the contributions that private foreign investments have been making, and could make on a much greater scale, to propel Cuba onto a more prosperous and sustainable growth path.

Sol Melia Havana

6. Policy Recommendations

It is time for Cuba to extract its rightful share of benefits from participating actively in the global economy. But the Cuban economy has a long way to go before most foreign investors would be willing to take significant risks on the island. Most importantly, Cuba needs to overcome its animosities and fears and reach a national  consensus that, as a small island economy, its economic future depends upon a healthy engagement with the international economy. As many other proud nations have discovered, it is possible to accept FDI without sacrificing national sovereignty and governance capacity. On the contrary, FDI can provide resources—including investment capital and fiscal revenues—that enhance national choices.

If Cuba had allowed FDI inflows equal to 5 percent of its GDP during the last decade, or roughly $2.5 billion a year, Cuba would have supplemented its domestic savings by some $25 billion.  This would have enhanced its ability to recapitalize its productive base while preserving and upgrading the quality of its social services. The Cuban government should send clear signals—including to its own bureaucrats—that it has moved beyond ambiguity and distrust toward a reasoned appreciation of the benefits that foreign investment can bring to a small island economy.

To begin to gradually improve the investment climate, Cuba could:

• Complement the 2011 reform guidelines with a coherent national competitiveness strategy that announces a prominent role for foreign investment. In designing this forward-looking strategy, the government should consult with existing joint venture executives.

• Completely overhaul the investment approval process, making it more transparent and much faster, as promised in the 2011 guidelines. To facilitate rational decision making by both parties, representatives of proposed investments should have ready access to responsible government officials. So that potential investors can better design projects to meet Cuban national priorities, official rulings should be accompanied by robust explanations. Smaller investments should be placed on a fast-track authorization process.

• Detail the approval criteria for the new FTZs, with its fiscal incentives, and include a coherent list of priority clusters.

• Remove the fixed-time horizon facing investments outside of the FTZs, which promotes myopic behavior and disinvestment as the deadline approaches.

• Not exclude multinationals that serve the domestic market simply because they do not readily fit into a national export promotion strategy. Cuban firms cannot replicate the massiveR&D and product innovation pipelines that characterize international giants such as Nestlé or Unilever, and whose outputs Cuban consumers will demand.

• Build forcefully on the successful strategy of selling quality Cuban products through established international marketing machines. This can be accomplished, for example, by forging alliances among pharmaceutical giants with global reach to make patented Cuban medical innovations available to consumers worldwide.

• Encourage FDI to integrate local firms into their supply chains. An inter-ministerial committee should build an integrated strategy to assist local firms to meet acquisition requirements. Include private businesses and cooperatives in an ambitious trade facilitation strategy that targets small and medium enterprises.

• Permit foreign investors to form a business association that would allow them to engage in a constructive dialogue with the government. Encourage investors to adapt corporate responsibility practices that observe Cuban laws and national goals and serve corporate stakeholders, including workers, communities, and consumers.

• Sharply reduce the implicit tax on labor, to the benefit of Cuban workers and the competitiveness of exports. Eventually dismantle the dual currency labor payment system altogether.

• Recast the anti-corruption campaign to focus on root causes: low wages and nontransparency.This can be done, for example, by shining sunlight on the procurement procedures of government entities and SOEs. Combating corruption in both the public and private spheres is critical to sustainable economic development, but properly structured incentives, not arbitrary prosecutions, are the more sustainable pathway toward ethical business practices.

• Publish much more data and analysis on the capital account and on FDI, including impacts on savings and investment, employment and wage levels, supply chain integration, and net export earnings.

Cuba could benefit tremendously from learning from other nations that have successfully extracted benefits from foreign investment. The international financial institutions (IFIs) offer a cost-effective short-cut to assess the applicability of comparative country  experiences. As argued in Reaching Out: Cuba’s New Economy and the International Response, now is the time for the international development community to engage in Cuba and support its incipient economic reform process.

Under their own new guidelines, the international financial institutions are capable of working within Cuban national priorities while they contribute their unique bundles of knowledge and capital.  With regard to FDI, IFIs are particularly well equipped. Furthermore, the presence of the IFIs would add credibility to Cuban investment commitments and to contract enforcement—important ingredients in establishing a more secure investment climate in a changing Cuba.

For these reasons, Cuba should signal to the IFIs its interest in entering a gradual path toward receiving, first technical assistance (studies, training) and eventually full membership.

Sherritt International, Cuba

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Cuba sugar cane marabu weeds ‘could be turned to fuel’

Posted on December 10, 2012 by Arch Ritter

Original Article here: Cuba sugar cane marabu weeds ‘could be turned to fuel’

By Sarah Rainsford BBC News, Ciro Redondo, Cuba

Driving the Cart past a “Marabu Woods

Drive anywhere in the Cuban countryside and you will spot the marabu lining the road: a dense, woody weed that grows as tall as trees and has invaded vast swathes of agricultural land. The land-grab began in the 1990s when Cuba was in economic crisis following the collapse of its great benefactor, the Soviet Union. The mighty sugar industry slumped too, and cane fields were overrun by marabu.

But to one British firm, the aggressive weed is less a problem than a valuable resource.

Havana Energy has just signed a $50m (£31m) investment deal to build a renewable-energy power plant in central Cuba, supplying one of the country’s biggest sugar mills as well as the national grid. During the harvest it will be fuelled by sugar-cane residue, known as bagasse. The rest of the year it will be fed with marabu. “Marabu has a very high calorific level and low moisture, so as biomass it’s very attractive,”

Harvesting marabu will also address a pressing issue on the island. “Seventy per cent of the food Cubans consume is imported, which is a national tragedy with their climate and soil,” says technical director Keith Dawson. “Every Cuban hates marabu so we’re doing a service: not just removing it but also returning the land to farming.”

The deal is a joint-venture with Cuba’s state sugar monopoly and is part of a move by the Communist government to diversify its energy supply away from dependence on subsidised, imported oil from its socialist ally, Venezuela.

“Cuba relies on diesel-powered power stations, which are even less green than coal, very expensive and give-off horrible emissions,” Mr Macdonald explains, saying his firm’s green energy will also be cheaper.

Now the papers have finally been signed, the British team face their first major test. Early next year they will import a combination of forestry and construction equipment that they hope can harvest the marabu economically. No-one has managed that yet. “You can’t underestimate marabu. We’ve brought foresters to look at it and they’ve been confused, and agricultural kit is not strong enough,” says agricultural adviser Julian Bell.

‘Terrible state’

The plant’s woody roots vary in size and are as dense as teak with fierce thorns.

“Usually you just wouldn’t bother. But I don’t know anywhere else with 1.5 million hectares covered in such a good energy source,” he says.

There is another incentive. Research at Strathclyde University has revealed that marabu produces high-grade activated carbon for use in filters – like in Cuban rum production. Potentially, the carbon could also be used in new-generation fast-charging batteries. So Havana Energy will bring a reactor to the Ciro Redondo mill next year to trial carbon manufacturing.

In the small town that grew up around the sugar mill, there is a good deal of expectation about the investment. The joint venture should create around 60 new jobs and includes funds to upgrade the dilapidated mill itself, now a century old. Only one of its three crushing machines are operational, it still has Soviet-era signs and ageing east German equipment, and large sections of the roof are missing. “It’s in a terrible state,” says retired sugar-worker Oberto Vazquez as he passes on his bicycle. “When it rains, it rains more inside than out.”

So for Cuba this venture is not only about sourcing alternative energy.

The government is in the midst of a drive to boost sugar production, cashing in on higher global prices and increased demand from countries like China. It has reopened almost a dozen old mills, targeting 20% production growth per year.

Tackling weeds

It has allowed foreign funds into the sector for the first time since the 1959 revolution. As well as the British venture, a Brazilian firm has been contracted to manage another large mill in a nearby province.

“The main [British] investment is to build the power plant, but we have negotiated access to credit to improve the cane fields and the sugar mill itself,” says Rafael Rivacoba, director of international relations at Azcuba, Cuba’s sugar firm. “I think that’s positive.” He describes further foreign investment in the sector as a possibility, but is cautious. The deal with Havana Energy took three years to negotiate. “We’re thinking about other things,” he says, admitting that international sugar brokers are knocking at his door. “But nothing’s been decided.”

On the ground in Ciro Redondo though, funding from anywhere is welcome.  The mill can only afford to irrigate 12% of its crops today; average yields in the cane fields are under half the international norm. “We have the will and the knowledge,” says manager Victor Dieguez. “But we need investment.”

That is now on its way and if this pilot project succeeds, the British team has an option to build four more power plants at other sugar mills. First though, it has to tackle the marabu: to prove that it does have the solution, to turn a weed into a valuable asset.

La Lucha Contra Marabu

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Cuban Medical Aid to Haiti; One of the World’s Best Kept Secrets

Posted on December 6, 2012 by Arch Ritter

Original here:   Cuban Medical Aid to Haiti , from Counterpunch, April 01, 2010

 by EMILY J. KIRK And JOHN M. KIRK

Media coverage of Cuban medical cooperation following the disastrous recent earthquake in Haiti was sparse indeed.  International news reports usually described the Dominican Republic as being the first to provide assistance, while Fox News sang the praises of U.S. relief efforts in a report entitled “U.S. Spearheads Global Response to Haiti Earthquake”-a common theme of its extensive coverage.  CNN also broadcast hundreds of reports, and in fact one focused on a Cuban doctor wearing a T-shirt with a large image of Che Guevara–and yet described him as a “Spanish doctor”.

In general, international news reports ignored Cuba’s efforts.  By March 24, CNN for example, had 601 reports on their news website regarding the earthquake in Haiti-of which only 18 (briefly) referenced Cuban assistance. Similarly, between them the New York Times and the Washington Post had 750 posts regarding the earthquake and relief efforts, though not a single one discusses in any detail any Cuban support.  In reality, however, Cuba’s medical role had been extremely important-and had been present since 1998.

Cuban-Haitian Medical Collaboration

Cuba and Haiti Pre-Earthquake

In 1998, Haiti was struck by Hurricane Georges. The hurricane caused 230 deaths, destroyed 80% of the crops, and left 167,000 people homeless.[1] Despite the fact that Cuba and Haiti had not had diplomatic relations in over 36 years, Cuba immediately offered a multifaceted agreement to assist them, of which the most important was medical cooperation.

Cuba adopted a two-pronged public health approach to help Haiti. First, it agreed to maintain hundreds of doctors in the country for as long as necessary, working wherever they were posted by the Haitian government. This was particularly significant as Haiti’s health care system was easily the worst in the Americas, with life expectancy of only 54 years in 1990 and one out of every 5 adult deaths due to AIDS, while 12.1% of children died from preventable intestinal infectious diseases.[2]

In addition Cuba agreed to train Haitian doctors in Cuba, providing that they would later return and take the places of the Cuban doctors (a process of “brain gain” rather than “brain drain”). Significantly, the students were selected from non-traditional backgrounds, and were mainly poor.  It was thought that, because of their socio-economic background, they fully understood their country’s need for medical personnel, and would return to work where they were needed. The first cohort of students began studying in May, 1999 at the Latin American School of Medicine (ELAM).

By 2007, significant change had already been achieved throughout the country. It is worth noting that Cuban medical personnel were estimated to be caring for 75% of the population.[3]  Studies by the Pan American Health Organization (PAHO) indicated clear improvements in the health profile since this extensive Cuban medical cooperation began.

Improvements in Public Health in Haiti, 1999-2007[4]

Health Indicator                                                      1999        2007

Infant Mortality, per 1,000 live births                     80         33
Child Mortality Under 5 per 1,000                         135         59.4
Maternal Mortality per 100,000 live births         523         285
Life Expectancy (years)                                               54          61

Cuban medical personnel had clearly made a major difference to the national health  profile since 1998, largely because of their proactive role in preventive medicine-as can be seen below.

Selected Statistics on Cuban Medical Cooperation
Dec. 1998-May 2007[5]

Visits to the doctor            10,682,124
Doctor visits to patients             4,150,631
Attended births                                86,633
Major and minor surgeries          160,283
Vaccinations                                   899,829
Lives saved (emergency)             210,852

By 2010, at no cost to medical students, Cuba had trained some 550 Haitian doctors, and is at present training a further 567. Moreover, since 1998 some 6,094 Cuban medical personnel have worked in Haiti. They had given over 14.6 million consultations, carried out 207,000 surgical operations, including 45,000 vision restoration operations through their Operation Miracle programme, attended 103,000 births, and taught literacy to 165,000. In fact at the time of the earthquake there were 344 Cuban medical personnel there. All of this medical cooperation, it must be remembered, was provided over an 11-year period before the earthquake of January 12, 2010.[6]

Cuba and Haiti Post-Earthquake

The earthquake killed at least 220,000, injured 300,000 and left 1.5 million homeless.[7] Haitian PrimeMinister Jean-Max Bellerive described it as “the worst catastrophe that has occurred in Haiti in two centuries”.[8]

International aid began flooding in. It is important to note the type of medical aid provided by some major international players. Médecins Sans Frontières (MSF), for example, an organization known for its international medical assistance, flew in some 348 international staff, in addition to the 3,060 national staff it already employed. By March 12 they had treated some 54,000 patients, and completed 3,700 surgical operations.[9]

Canada’s contribution included the deployment of 2,046 Canadian Forces personnel, including 200 DART personnel. The DART (Disaster Assistance Response Team) received the most media attention, as it conducted 21,000 consultations-though it should be noted they do not treat any serious trauma patients or provide surgical care. Indeed, among the DART personnel, only 45 are medical staff, with others being involved in water purification, security, and reconstruction. In total, the Canadians stayed for only 7 weeks.[10]

The United States government, which received extensive positive media attention, sent the USNS “Comfort”, a 1,000-bed hospital ship with a 550-person medical staff and stayed for 7 weeks, in which time they treated 871 patients, performing 843 surgical operations.[11]  Both the Canadian and US contributions were important-while they were there.

Lost in the media shuffle was the fact that, for the first 72 hours following the earthquake, Cuban doctors were in fact the main medical support for the country. Within the first 24 hours, they had completed 1,000 emergency surgeries, turned their living quarters into clinics, and were running the only medical centers in the country, including 5 comprehensive diagnostic centers (small hospitals) which they had previously built.  In addition another 5 in various stages of construction were also used, and they turned their ophthalmology center into a field hospital-which treated 605 patients within the first 12 hours following the earthquake.[12]

Cuba soon became responsible for some 1,500 medical personnel in Haiti. Of those, some 344 doctors were already working in Haiti, while over 350 members of the “Henry Reeve” Emergency Response Medical Brigade were sent by Cuba following the earthquake.  In addition, 546 graduates of ELAM from a variety of countries, and 184 5th and 6th year Haitian ELAM students joined, as did a number of Venezuelan medical personnel.   In the final analysis, they were working throughout Haiti in 20 rehabilitation centers and 20 hospitals, running 15 operating theatres, and had vaccinated 400,000. With reason Fidel Castro stated, “we send doctors, not soldiers”.[13]

Read more:  Cuban Medical Aid to Haiti

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Cuba’s Medical Diplomacy: Aid, State Profiteering and International Financial Backing

Posted on December 6, 2012 by Arch Ritter

BY MARIA C. WERLAU;  mariacwerlau@gmail.com

Haiti’s President Michel Martelly recently visited Cuba to sign cooperation agreements including in health. No doubt Haiti needs help to deliver needed healthcare, but these accords exploit Cuban workers and contribute to the continued oppression and impoverishment of the Cuban people.

Cuban Medical Worker, Haiti

Currently, around 700 Cuban health professionals are in Haiti. Cuba has similar government-to-government agreements with over 70 countries. These partnerships allow the Castro dictatorship to reap huge financial gains, avoid needed reform, and increase international influence to advance its agendas. Meanwhile, the export of scarce medical resources is causing a severe public health crisis in Cuba. Doctors and basic medical supplies are hard to find and facilities are falling apart.

When the earthquake struck, 344 Cuban health professionals were working throughout Haiti; more were immediately sent and deployed to the most remote areas. Cuba had long been receiving millions from international organizations and countries such as France and Japan for these services. Great need and corresponding international largesse became a golden opportunity. Just weeks after the disaster, Cuba was promoting a gigantic endeavor to build a new healthcare infrastructure for Haiti at an annual cost of $170 million, to be paid for by international donors. Cubans and Cuban-trained medical staff would run it at “half the international prices.”

Countless millions are now pouring into Cuba from the Pan American and World Health Organizations, dozens of NGOs, foundations, companies, and individuals from the United States, Canada, Spain, Belgium and others. Many governments have also donated — Venezuela $20 million to start, Brazil $80 million, Norway $2.5 million. The list of donations is undisclosed, but France, Australia, Japan, and other countries have apparently chipped in. The cost to Haiti is just a $300 monthly stipend to each Cuban health worker plus transportation and housing.

Haiti is just one very profitable subsidiary in Cuba’s global multi-billion dollar ¨humanitarian¨ enterprise. Most of its profits come off the backs of Cubans indentured as “collaborators.” Angola, for example, reportedly pays Cuba $60,000 annually per doctor; the doctor receives $2,940 (4.9 percent), at most. These service exports bring more than three times the earnings from tourism and far more than any other industry — $7.5 billion in 2010, the last year reported. Business is so good that in 2010 the Cuban government reduced an already decimated local health staff by 14 percent to send more abroad.

This unique brand of health diplomacy is only possible in a totalitarian state guaranteeing a steady pool of “exportable commodities.” Leaving Cuba without government authorization is punishable with years of prison; health professionals face the strictest travel restrictions. If they defect while abroad, their family, which must stay behind, cannot joint them for five years; issuing them academic or other records is forbidden.

The average monthly pay of a doctor in Cuba is around $25, barely guaranteeing survival. Abroad, they live off a bare-bones stipend from the host government. But, they receive from Cuba their usual peso salary and a bonus of $180-220 per month, plus are allowed to send home shipments of consumer goods. This paltry compensation package is enough for Cuban doctors to “volunteer” to be exploited abroad rather than at home.

The health workers are sent abroad for at least two years and often to far-flung areas under rudimentary, sometimes dangerous, conditions. In Venezuela, dozens have been killed or raped. Heavy workloads, surveillance, and many arbitrary restrictions add to their hardship.

In this clever scheme of modern slavery, Cuba is partnering with dozens of governments — including longstanding democracies such as Portugal and Uruguay — and receiving funds from reputable countries and international organizations. Ostensibly, the agreements violate the domestic legislation of many host countries and international accords including the Trafficking in Persons Protocol, several International Labor Organization conventions, and standards concerning the prohibition of “servitude” and “slavery.”

The Martelly agreements with Cuba should be made public. If they violate human rights’ standards, Haiti should manage the international aid independently to hire and compensate Cuban workers directly and invite their families to join them. Other countries should take note.

Maria Werlau is executive director of Cuba Archive, a non-profit human rights’ initiative based in Summit, New Jersey.

 

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How Capitalist Are the Cubans?

Posted on December 3, 2012 by Arch Ritter

By DAMIEN CAVE, New York Times, December 1, 2012

Original article here: How Capitalist Are the Cubans?

Óscar Espinosa Chepe: “The battle for ideas was the most important battle, and they’ve lost.”

A man in his shoe repair shop in the doorway of his home. New business regulations have allowed thousands of citizens to make money for themselves for the first time since 1959.

IT was just a small sign, red, round and electrified, advertising homemade pizza — the kind of thing no one would notice in New York or Rome. But in Havana? It was mildly amazing.

Cuba, after all, has been dominated for decades by an all-consuming anticapitalist ideology, in which there were only three things promoted on billboards, radio or TV: socialism, nationalism, and Fidel and Raúl Castro. The pizza sign hanging from a decaying colonial building here represented the exact opposite — marketing, the public search for private profit.

And it wasn’t just tossed out there. Unlike the cardboard efforts I’d seen in the same poor neighborhood on a visit to Cuba last year, the sign cost money. It was an investment. It was a clear signal that some of Cuba’s new entrepreneurs — legalized by the government two years ago in a desperate attempt to save the island’s economy — were adapting to the logic of competition and capitalism.

Arts and Crafts Market, Avenida (G) de los Presidentes, 1995

But just how capitalist are Cubans these days? Are they embracing what Friedrich Hayek described as the “self-organizing system of voluntary cooperation,” or resisting?

“It’s a combination,” says Arturo López Levy, a former analyst with the Cuban government now a lecturer at the University of Denver. “When more people get more proactive and more assertive, then other people — whether they like it or not — have to do the same. They have to compete. I think that’s the dynamic.”

Indeed, like Iraq, Russia, Mexico or other countries that experienced decades of dictatorial rule that eventually ended, Cuba today is a society marked by years of abuse, divided and uncertain about its future. The changes of the past few years — allowing for self-employment, freer travel, and the buying and selling of homes and cars — have been both remarkable and extremely limited. The reasons small things like signs matter so much here is because everyone is concerned with momentum, and no one seems to know whether Cuba is really on the road to capitalism, as The Economist asserted in March, or if the island is destined to simply sputter along, with restrained capitalism for a few and socialist subsistence for the rest.

The debate is all the more complicated because the same leaders who rejected capitalism for so long are now the ones trying to encourage people to try it out. Raúl Castro was notoriously the revolution’s most loyal Communist; now, as the country’s president, he is the main booster for free market reforms. On one hand, a recent gathering of Cuba’s Communist Party earlier this year included a session on overcoming prejudices against entrepreneurs; on the other, Raúl Castro has said he would “never permit the return of the capitalist system.”

“They are kind of schizophrenic,” says Ted Henken, a Cuba expert at Baruch College. “They are saying they are changing, but they treat these things as gifts and not as rights.”

And yet, there is no longer any denying that pockets of controlled capitalism are emerging in Cuba. In Havana, in particular, small businesses are everywhere. Entire urban industries, including taxis and restaurants, are being transformed through a rush of new entrants, who are increasing competition for customers, labor and materials. Even the most elemental tasks that used to be managed by the state — such as buying food — are increasingly in the hands of a private system that sets its own prices based on supply and demand.

Though the initial burst of activity has slowed, some experts say the explosion in commerce showed just how capitalist Cubans were all along. Of the roughly 350,000 people licensed to be self-employed under the new laws by the end of 2011, 67 percent had no prior job affiliation listed — which most likely means they were running underground businesses that then became legitimate.

Some of the most successful entrepreneurs are optimistic about Cuba’s becoming more open to free market ideas. Héctor Higuera Martínez, 39, the owner of Le Chansonnier, one of Havana’s finest restaurants (the duck is practically Parisian), says that officials are “starting to realize there is a reason to support private businesses.” He has given people work, for example, and he brings in hard currency from foreigners, including Americans.

“Before, we had nothing,” he said. “Now we have an opportunity.”

He is doing everything he can to make the most of it. When we met one night at the restaurant, he had already written up several pages of notes and charts explaining what his industry needed to grow — from wholesale markets to improved transportation for farmers to an end to the American trade embargo to changes in the Cuban tax code. In an ingeniously cobbled-together kitchen, in which only one of three ovens worked, he mostly seemed to salivate at the thought of vacuum packing so his meals could be delivered more efficiently.

HE was about as capitalist as it gets. But will his ideas ever be adopted? Like everyone else, he faces severe limits. He can hire no more than 20 employees, for example. He does not have access to private bank loans, and the government has shown little inclination to let people like Mr. Higuera succeed on a grand scale.

Instead, when success arrives, the government seems to get nervous. This past summer, officials shut down a thriving restaurant and cabaret featuring opera and dance in what had been a vacant lot, charging the owner with “personal enrichment” because he charged a $2 cover at the door. A news article from Reuters had described it as Cuba’s largest private business. A few days later, it was gone, along with 130 jobs.

The Castro government has tried to keep a lid on innovation in other ways, too. It has not allowed professionals like lawyers and architects to work for themselves. And its efforts at political repression have focused over the past few years on innovative young people seeking space for civil discourse in public and online — the blogger Yoani Sánchez, or Antonio Rodiles, director of an independent project called Estado de Sats, who was arrested in early November and released last week after 18 days in jail.

So for now, what Cuba has ended up with is handcuffed capitalism: highly regulated competitive markets for low-skilled, small family businesses. What economic freedom there is has mostly accrued to those whose main ambition is making and selling pizza.

Which again raises the question: is Cuba really heading toward capitalism or not? Skeptics are easy to find. “Every place in the world that has had real change, it has changed because the regime itself has allowed some significant openings and the door has been pushed wide open,” says Senator Robert Menendez, Democrat of New Jersey. “That’s not what’s happening here.”

Many Cubans say they are hesitant to let go of a reliable system summed up by a common joke: “We pretend to work, they pretend to pay us.” Taxi drivers told Mr. López Levy that they were working harder for less money because of increased competition. A farmer I met at the wholesale market outside Havana equated capitalism with higher prices, and said that the government needed to intervene.

But mostly, this is an aging crowd and Mr. López Levy — who still has friends and relatives in government — says that even among Cuban bureaucrats, the mentality is changing. If so, more capitalism may be inevitable. Because with every new entrepreneur it licenses, Cuba becomes less socialist, less exceptional, less of a bearded rebel raising its fist against the horrors of Yankee capitalism. In the eyes of some Cubans, the jig is already up.

“The government has lost the ideological battle,” said Óscar Espinosa Chepe, a state-trained economist who was sent to jail in 2003 for criticizing the government. “The battle for ideas was the most important battle, and they’ve lost.”

Art market, Plaza de la Catedral. 1994

Arts and Crafts Market, Malecon, 2006

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Juan Triana: “From the submerged economy to micro-enterprise, are there any guarantees for the future?”

Posted on November 27, 2012 by Arch Ritter

Dr.  Juan Triana Cordoví, Universidad de la Habana

November 15, 2012

Submerged economy, merolicos, informal workers, cuentapropistas, self employed, a “necessary evil”, are some of the qualifiers used to describe individuals who work in the independent sector in Cuba closely reflects the fluctuations and reversals to which the non-state run economy has been exposed, and which in a way have been a thermometer for the transformations of the Cuban economy.

Art Market, on the Malecon. Photo by A. Ritter

I. Some history: from the revolution to the rebirth of the independent work in 1993

As a result of the Cuban revolution in 1968, about 58,000 private businesses were nationalized, mostly small family businesses, focused on retail and restaurants. Some other small businesses worked in some kind of craft or industry, but these were generally low-tech. Some estimates put those businesses as employing between three and seven workers each. If we estimate an average of five workers per business, then the sector generated employment for about 300,000 people, out of a total population that exceeded six million.

Self-employment appeared when the different alternatives generated from the State failed to meet the demands of the population for different services and products (On July 3, 1978 Executive Order No. 14 was issued to regulate self-employment activities to be exercised by workers), but after a brief period of expansion, it languished in the absence of stimulus policies and its tacit rejection based on ideological and political considerations.

Self employment was revived in 19931 (Executive Decree 141) in response to the adjustments in the production and employment sectors generated by the crisis. It was accepted as a “necessary evil,” but not as an integral part of a development strategy destined to occupy a legitimate space to contribute to growth efforts 2.

Far from policies to stimulate and insert it in the operating dynamics of the economy, those policies helped to marginalize it, restrict it and prevent a qualitative transformation, which caused the decline of the sector (between 1996 and 2001 by 40%), its geographical concentration (especially in Havana) and concentration on the most profitable activities (food, transport and rentals)

That same policy that limited the access of new workers to the sector caused the generation and appropriation of undue rents, supported by the virtual monopoly in some market segments by those who “had come first,” into the sector and were later “protected” by the State. This was really ironic because the barriers to enter the sector that were created from the institutions that were supposed to “regulate” it, and the restrictive policies established, reduced competition in the “cuentapropista” sector, allowing the accumulation of income, not based on productivity and efficiency, as well as the expansion of informal channels of supply, some of them, hard to quantify, in many cases from state agencies, creating disincentives for improvement and innovation.

There were two big losers: the dynamics of the national economy, as an economic circuit was generated separately from the rest of the economy, and the population (clients) who debated between the government monopoly over some services, and the monopoly that almost unwittingly was exercised by portions of the self-employed over some (most lucrative) activities and services that were “unregulated”.

II. “Cuentapropismo” beyond “cuentapropismo”

 Studies of this sector in Cuba, have often given priority to its importance for the economic liberalization and decentralization, as well as its significance from the point of view of the expansion of market relations. There is another perspective on this issue that also must be addressed. Micro, small and medium enterprises are part of the skein of any economy, regardless of the degree of development. Their contribution to employment is significant, the flexibility and maneuverability that it gives the economies (even developed economies) allowing systematic adjustments is unquestionable, and in some economies, this sector even has innovation capabilities that should not be ignored.

Until not very long ago, the “cuentapropista” sector in Cuba was a marginal sector, but this has drastically changed starting on 2011, and this trend should increase in the coming years.3

Table 1. Employment Dynamics

         2008    2009      2010      2011

Total number of employed  (thousands)     4.948,2   5.072,4  4.984,5  5.010,2

State sector                         4.112,3   4.249,5  4.178,1  3.873,0

            Cooperatives                            233,8      231,6     217,0     652,1

            Private                                      602,1      591,3     589,4    485,1

            Independent workers            141,6      143,8     147,4    391,5

Source: ONEI, Anuario estadístico de Cuba 2011.

A reading of the data reveals some new features of the national economy regarding employment:

a. The total number of the employed fluctuates around five million people and it should grow significantly in the coming years.

b. The participation of the state sector continues to be decisive in total employment, but it has declined in the past two years.

c. In the non-state sector, the number of the employed decreased as a whole4, but the “cuentrapropista” sector was able to generate 244,000 jobs.

A fact that is relevant to the survival of the cuentapropista sector in the medium and long term is that it has become a significant element of employment for the country, since no other sector with so little capital is able to generate that amount of employment, so it is “socially desirable”. It is also the fastest growing sector in female employment in recent years. All these “objective reasons” give certain guarantee in the medium and long term for the existence of “cuentapropismo”. Today it is a functional sector due to the reforms undertaken in 2007 and consolidated in 2011.

A Fine New Restaurant: Paladar “Dona Eutimia”, Callejon del Chorro, Plaza de la Catedral, opened February 2010; Photo by Arch Ritter

 III. Institutionalis m and “cuentapropismo”

 Another perspective of this analysis is associated with the institutional protection that has been created to protect the independent sector.

The “modern legal network” directly associated with the expansion of self-employment was initially contained in two special issues of the Official Gazette of the Republic of Cuba published on October 25, 2011 (numbers 11 and 12, dated 1 and 8 October, respectively). They included five legislative decrees, an executive decree, an agreement of the Executive Committee of the Council of Ministers, and fourteen ministerial decisions.4 Probably due to two factors: the contraction of the foreign companies and the loans and services cooperatives.

With regards to Legislative Decree 141 of 1993, the 2011 modernization of the statute introduced obvious advantages, as it:

• Allowed commercial exchanges between “cuentapropistas” and Government entities.

• Authorized hiring a workforce, automatically converting “cuentrapropistas” into micro entrepreneurs.

• Conferred the status of taxpayers and Social Security recipients.

• Authorized access to bank financing.

• Allowed the rental of government or third party premises and assets.

• Authorized the exercise of several trades by the same person.

• Removed the restriction of having to belong to a territory to exercise a trade in it.

• Dispensed with the requirement of being retired or have some employment link to access this form of employment.

• Removed the restriction on the rental of a whole house or apartment, to allow the leasing of rooms by the hour and the use property assigned or repaired by the state in the past decade.

• Allowed the leasing of homes and vehicles to people who have residence abroad or to those living in Cuba, but leaving the country for more than three months, for which they can appoint a representative.

• Increased the capacity to fifty seats in the “paladares”, removed the restriction to employ only family members, and the ban on the sale of food products made with potatoes, seafood and beef.

 As a result, a new regulatory environment has been created that exceeds the direct legal network. As part of the reform, as well as other measures authorizing the sale of houses and cars, for example, allows legal improvement to the facilities of the business, and the sale of cars which can improve the “assets” of new businesses.

In addition, the land lease policy and its recent update could facilitate the increase of supplies for those engaged in food services.

A sign that the sector considerations have changed, and that the current government wishes to convey security and transparency, is the submission to the National Assembly in the summer of 2012, of a new tax law that incorporates some additional benefits for independent workers, which include:

• The tax burden of the self employed is reduced between 3% and 7% for the segments with higher and lower income, respectively.

• A tax rate decrease for the use of labor force in the sector of self-employed workers, from 25% to 5% in the term of 5 years. It also maintains this tax exemption for the self-employed, individual farmers and other individuals authorized to hire up to 5 workers.

 To these considerations we should add the “ideological and political institutionalization” of the sector, whose best expression is reflected in the words of President Raul Castro:

“The increase in the private sector of the economy, far from being an alleged privatization of social property, as some theorists claim, is destined to become a facilitating factor for the construction of socialism in Cuba, as it will allow the State to focus on raising the efficiency of the basic means of production owned by the people and release the management of nonstrategic activities for the country … we must facilitate the management and abstain from generating stigma or prejudice towards them and demonize them” ….. and later added “This time there will be no return”.

 Soon, a new regulation for the operation of cooperatives in the agricultural sector will be released, which will enrich the environment in which the self-employed sector operates, will introduce new competitive challenges and make the economic fabric of the country more complex, generating new production chains.

Certainly, there is still a long way to go. Eventually it will be necessary to formally take the step from “cuentapropismo” to micro, small and medium enterprises. The time has come to consider legislation regulating a negative list (much smaller than the current listing of allowed work) of jobs that cannot be exercised privately. The time has come to incorporate offices and university professionals in jobs directly related to their careers to prevent their loss by emigration or non-use, and/or the waste of human potential unquestionably created in recent years, who have proven to be highly competitive in “other markets “. At some point, it will be necessary to incorporate into the Constitution of the Republic these new realities to begin to delineate a new economic model, but also to begin to draw a new model of development for the country, in which productivity gains and efficiency cannot be expected to only come from the state sector.

1 (*) Professor of the Centro de Estudios de la Economía Cubana, Universidad de la Habana.

(**) Cuentapropista used interchangably with self-employed in translation.

In 1993 it was established who could be self employed: state enterprise workers, retirees, the unemployed who receive subsidies from the State.10 and housewives11, and what activities, especially manual could be included, limiting access to those who could compete with the state.

2 Services that can be offered are limited and are prohibited in some geographic areas, there is no access to bank loans, workers cannot be hired as such (only allowed family work), and a high tax system is applied to independent activities … This regulation determines that the production costs must be assumed by the “cuentapropistas”.

3 In fact, the space gained by some of these “modalities” has ignored certain issues such as the “tourism extra hotels network” always considered inside the state sector but one of the weaker of the government enterprises. Today there are in Havana more than 370 private restaurants and possible more than half of them have appeared since 2011.

Mercado Atesanal, on the Malecon, photo by Arch Ritter

Bibliography.

Castro R. Periódico Granma, 20-12-10

Gaceta Oficial de la República de Cuba, No. 12, Edic. Extraordinaria, 8-10-12.

Vidal P. y Pérez O. Entre el ajuste fiscal y los cambios estructurales: se extiende el cuentapropismo en Cuba, Espacio Laical No. 4, 2010.

Fuentes, I. Cuentapropismo o Cuentapriapismo: Retos y Consideraciones Sobre Género, Auto-Empleo y Privatización, Cuba in Transition, ASCE, 2000

Ritter A. El régimen impositivo para la microempresa en Cuba, Revista de la CEPAL No. 70, 2000, Naciones Unidas CEPAL, Santiago Chile.

Peter P. “Cuban Entrepreneurs: From Necessary Evil to Strategic Necessity” http://www.american.com/archive/2011/january/cuban-entrepreneurs-from-necessary-evil-to-strategic-necessity

Gonzáles A. “La economía sumergida en Cuba” Revista Investigación Económica, No.2, April-June 1995, INIE.

Suárez L. M. “Cuba: nuevo marco regulatorio del trabajo por cuenta propia” en www.evershedslupicinio.com

Cuenta Propista and Artisan, Photo by Arch Ritter, November 2008

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New Tax System Being Introduced in Cuba

Posted on November 26, 2012 by Arch Ritter

On November 21, Cuba’s Gaceta Oficial (No. 53, del 21 de noviembre del 2012) published a new Law on Taxation, that had been approved earlier on July 23 and October 31.The basic outline of the law was approved by the Congress of the Communist party in April of 2011 and then by the National Assembly in 2012.

The complete gaceta version is not yet available “On Line”  though a published version has been distributed within Cuba. A description of the law has been presented in Granma here: Ley del Sistema Tributario   and Granma, 21 de Noviembre de 2012, Ley del Sistema Tributario. The introduction of the Granma article is presented below.

An analysis of the implications of the new taxation system must await the availability of the detailed text from the Gaceta Oficial.

Part of the Older Taxation System

Ley del Sistema Tributario
Instrumento decisivo en el camino de la actualización

Ivette Fernández Sosa

La política fiscal cubana deberá contribuir al incremento sostenido de la eficiencia de la economía y de los ingresos al Presupuesto del Estado con el propósito de respaldar el gasto público en los niveles planificados y mantener un adecuado equilibrio financiero, tomando en cuenta las particularidades de nuestro modelo económico. Así se consigna en el Lineamiento 56 de la Política Económica y Social del Partido y la Revolución, aprobado en el Sexto Congreso del Partido, y que a su vez, da paso a otras directrices que deberán desempeñar un papel determinante en la búsqueda de un proyecto social más justo y sostenible.

La ley servirá de acicate para el desenvolvimiento de las esferas y actividades impulsoras del desarrollo socio-económico del país

El Parlamento cubano aprobó la Ley No. 113, del 23 de julio del 2012, del Sistema tributario que acompañada de su Reglamento, el Decreto No. 308, del 31 de octubre del 2012, de las normas generales y los procedimientos tributarios, se publicó hoy en la Gaceta Oficial Ordinaria No. 53, del 21 de noviembre del 2012, de la República de Cuba.

Al aprobar este nuevo instrumento jurídico —cuya aplicación se ha previsto de forma paulatina a partir de enero del 2013—, quedarán derogadas la Ley 73 de 1994, el Decreto-Ley 169 de 1997 y cerca de otras 200 regulaciones emitidas por el Ministerio de Finanzas y Precios para normar la actividad tributaria en el país.

En su intervención en la Sesión Plenaria de la Asamblea Nacional del Poder Popular celebrada el pasado julio, el vicepresidente del Consejo de Ministros, Marino Murillo Jorge, identificó al sistema tributario como una herramienta que contribuye a disminuir las desigualdades entre los ciudadanos dada su capacidad de redistribución de los ingresos.

En su aplicación se tiene en cuenta la capacidad económica de los sujetos obligados a su cumplimiento y las características de los territorios; estableciéndose mayores gravámenes para los ingresos más altos, esclareció.

La Ley establece las normas sobre el pago de impuestos, tasas y contribuciones al Presupuesto del Estado.

 

 

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