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14ymedio, Zunilda Mata, Havana, 20 October 2017 — On a corner of Centro Habana an old sofa displays its swollen slats and next to it lie the paddles of a fan. These are the remains left by Hurricane Irma’s flooding of the area, the belongings of families that now apply for bank loans to recover, … Continue reading "Bank Loans Do Not Fix the Lives of Those Affected by Irma" Continue reading
Ivan Garcia, 18 September 2017 — TV Cuba is different. In the news, we see mechanical shovels collecting debris, brigades of electrical linemen repairing the posts blown down by the powerful hurricane and optimistic citizens who “trust that the revolution will not leave them helpless.” Real Cuba is something else. Garbage collection is done at a snail’s … Continue reading "Cuban Hurricane Victims Demand Cuts in Prices and Customs Fees / Iván García" Continue reading
GETTY BREXIT BRITAIN: The value of sterling slumped to a 31-year low after the referendum The pound is showing signs of recovery one year on from the referendum. The exchange rate climbed from €1.13311 to €.14051 to the pound this morning, as Brexit … Continue reading
As Cuba's economy flat-lines, retirement has become notional
Tiny pensions must be supplemented by whatever work is available
Mar 23rd 2017 | HAVANA

NORBERTO MESA, a 66-year-old grandfather, stands in the hot sun 11 hours
a day, six days a week, guiding cars in and out of the parking spaces in
front of a bustling farm stand. The 4,000 Cuban pesos ($170 at the
official exchange rate) he earns each month in tips is more than ten
times his monthly old-age pension of 340 pesos. Without it, the retired
animal geneticist could not afford fruit and meat, or help his children,
who work for low salaries, to feed his four grandchildren.

Though revolutionary Cuba had one of the region's earliest and most
comprehensive pension systems, in recent years retirement has almost
vanished. Without further economic reform, and the cheap oil that used
to come from Venezuela, the economy has stalled. Pensions have been
frozen, and their value eaten up by inflation. According to the most
recent government statistics, from 2010, a third of men past retirement
age are working. Three-fifths of older people say they often have to go
without necessities.

The insular socialist paradise supposedly offers a social safety-net,
cradle to grave. But it is full of holes. Medical care is free, but most
medicine is not. Retirement homes are scarce, and rules that mean
residents must give up their pensions and homes put off many, since
these are often a lifeline for younger relatives in equally distressed
circumstances.

So old people can be seen on the streets of Havana selling newspapers
and peanuts, or recycling cans. They are scrubbing floors in affluent
homes or cooking for a growing number of private restaurants and
bakeries. Ernesto Alpízar, an 89-year-old former agronomist, goes
door-to-door selling strawberries and flowers. Even so, he remains an
ardent "Fidelista", grateful to the island's late dictator for the free
cataract surgery that saved his eyesight.

For even as the island's old and infirm must hustle to survive, they
have benefited from its success at providing health care. Life
expectancy at birth is 79, not far short of most developed countries,
and widely available birth control helps explain why family size has
fallen further and faster than in most other countries (see chart). The
flip side, though, has been a breakneck demographic
transition—exacerbated by the large share of young and middle-aged
Cubans who have fled to America. Over-65s now make up 14% of the
population. The national statistical office estimates that the total
number of pensioners will overtake the number of state-sector workers by
2025.

A few churches and charities, mostly funded from abroad, are trying to
fill the gap. Rodolfo Juárez, a pastor of the International Community
Church, a Protestant congregation, helps 60 indigent elderly people in
Havana. His scheme provides fruit, vegetables and beans to supplement
government rations of a daily piece of bread; and 7lb of rice, 2lb of
sugar, five eggs and a piece of chicken a month. Although running it
costs just 18,000 pesos a month, funding is a constant problem.

Mr Juárez and his wife, at 80 and 75, are older than many of those they
help. Between their church duties and his teaching at a seminary, they
make 3,600 pesos a month. Though that does not go far, it dwarfs Mr
Juarez's pension. As long as Cuba's economy flat-lines, its elderly will
have no rest till they drop.

Source: Hustling, cradle to grave: As Cuba's economy flat-lines,
retirement has become notional | The Economist -
http://www.economist.com/news/americas/21719482-tiny-pensions-must-be-supplemented-whatever-work-available-cubas-economy-flat-lines Continue reading
Print section Print Rubric:  As the island’s economy stalls, retirement has become notionalPrint Headline:  Hustling, cradle to gravePrint Fly Title:  Cuban pensioners UK Only Article:  standard articleIssue:  Amazon’s empireFly Title:  Hustling, cradle to graveLocation:  HAVANAMain image:  20170325_amp501.jpgNORBERTO MESA, a 66-year-old grandfather, stands in the hot sun 11 hours a day, six days a week, guiding cars in and out of the parking spaces in front of a bustling farm stand. The 4,000 Cuban pesos ($170 at the official exchange rate) he earns each month in tips is more than ten times his monthly old-age pension of 340 pesos. Without it, the retired animal geneticist could not afford fruit and meat, or help his children, who work for low salaries, to feed his four ... Continue reading
Naive Commentary about Two False Currencies / 14ymedio, Miriam Celaya 14ymedio, Havana, Miriam Celaya, 11 January 2017 — It is not common, in the middle of all the gloom and the torrents of noteworthy dates that constitute the bulk of the official press, to find a journalistic work that brings to light — even partially […] Continue reading
In Cuba Everybody Wants My Money
December 22, 2016
By Yudarkis Veloz Sarduy (Progreso Semanal)

HAVANA TIMES — In my household, nobody could believe what journalist
Boris Fuentes was telling us on the "Cuba Says" segment of the National
News on Cuban TV one night at the end of November.

If a bunch of onions costs 30 pesos in one market, the same bunch could
cost you as much as 70 in another, and a pepper, take note, one bell
pepper, just one, could cost you as much as 15 pesos. The reporter also
talked about the price of steaks: 40 or 50 pesos, and salesmen said that
if they received meat for 25 pesos, they couldn't sell it for less than
50 so as to earn "a little". A little?

I couldn't help but remember that chorus in "Todos se roban" (Everybody
steals) by Carlos Varela and I continued to watch spellbound before the
revelation of the bad weights on scales at markets and packets that
don't reach a full pound. A victim myself of all of this, far from being
pleased that government media were finally keeping tabs on this subject,
I swallowed my enormous grief and shame.

Well there you have it, Havana is another country, and inside Havana
there are another many different countries. In Regla, you can paint your
nails for 10 pesos, but in some private salons in Vedado they charge you
3 CUC (75 pesos). And I used to pay just 2 Cuban pesos a few years ago
for the same hand treatment, and between one and the other, the salon in
Regla and Vedado, is there only a difference in glamour? Not really:
they both use the same nail polishes and even – I was able to verify
this at the De Luce Unisex Salon, on 23 and F Streets, that they don't
even use the expensive gloss, they fill up small bottles that were once
L'Oreal or Golden Rose with what they buy in bulk

A friend of mine paid 15 CUC there to have her hair washed and styled
with a brush and hairdryer. What's happening to the Cuban people? My
dear friend, 15 CUC are 375 Cuban pesos, the basic monthly salary of
many ordinary Cubans. How are there people who charge this amount? But
worst still, how are there people, and a lot of them – because otherwise
prices would have been lowered by now – who pay these exorbitant amounts?

However, I don't think you should question the person who progresses and
increases their income with the money that other people pay them for a
service. Not when products in hard-currency stores are taxed 200% on top
of what it cost the country to buy them abroad. With or without the
blockade, this is a mind-boggling affair.

The same Nivea shower gel bottle you can buy "abroad" for 2 euros, costs
6 CUC in Cuba, and on top of that, remember that 2 European euros are 2
euros out of a basic salary of 1000 euros, while 6 of our CUC are 150
pesos out of an average salary here of 687 CUP.

How many days does a Cuban person who earns an average salary have to
work to buy, not a bottle of Nivea shower gel, as this could be
considered a luxury, but a pair of shoes which cost, those of an
extremely poor quality, 20 CUC?

The most basic of math: 20 multiplied by 25 = 500, 687 divided by 24
(number of working days in a month) = 28.62

A Cuban who earns an average salary earns 28.62 Cuban pesos a day, so,
500 divided by 28.62 = 17.47 days

A Cuban has to pay what they earn working for nearly 18 days in a month
for a pair of shoes of of very questionable quality, and will their
salary for the remaining 6 working days in the month be enough for them
to eat, clean themselves, pay for urban transportation and the rest of
their daily needs?

Everything is extremely surreal in this country. People survive, they
fall into debt by asking for loans, they set up businesses, they resort
to this Cuban magic which even those of us who practice it so much don't
really know what it's made up of, and we survive one more month, making
projects and we're offended by the prices in stores but we continue to
pay them for products we need.

Luckily, the boat which crosses the bay still only costs 10 Cuban cents
although they don't always give you all of the change, like on the
buses, and its best that I don't go into that. And luckily, there are
still regulated products and that ration book which don't last until the
end of the month either. Luckily yes, we have healthcare, and
education…, but it isn't news for any newspaper that what you take on
the side for the doctor ensures medical assistance, can move up an
appointment, and improves the treatment you receive or can make possible
a surgery.

A small act of kindness

What we have become is painful to see. "A small act of kindness", the
girls at the housing office call what they ask from people who are
desperate because the process is too bureaucratic and takes longer than
they can wait depending on their personal circumstances or any rational
logic.

And "a little act of kindness" is the CUC which is given as a gift to
the dentist who does have the material needed to do a filling. "A little
act of kindness" are the 50 pesos which somebody pays on top of the
price of their bus ticket which no longer appears at any agency, but
there is always one where it does. And I'm NOT talking about bribery.
Let's not be gullible.

I get goosebumps when I hear at Camaguey bus station: "Havana, Havana,
ticket to Havana," and when I get closer and ask because I really need
to get there, I'm told that for 15 CUC I can get onto the bus that is
about to leave, and that I shouldn't worry, that those 15 CUC include
the ticket office's price. And rightly so!

Luckily, there is always a manager on shift who isn't too rigid and sees
that you really need to go by looking in your eyes and helps you, and
doesn't even want to accept the 14 pesos change that he has to give you
for the 106 pesos that the trip in the Yutong bus costs you, and you
find yourself pinching yourself and giving a sideways glance while you
do the math, knowing he'll make enough with the overpriced tickets he
sells to everybody else," and you thank him and even hug him, because
"in Cuba people don't help you without 'a little kindness', you should
know that by now."

In order to get an appointment at the Mexican Embassy, you have to pay
30 CUC to somebody who only God knows how they manage to do it, and they
do, in most cases, but it's already agreed in advance that if it doesn't
take place in the end, they'll give you back 25 CUC. What is this? What
diabolic mechanism has encouraged the fact that in order to "manage"
something you have to let go and let go and let go, and at these prices?

Then there's a Cuban passport which costs 100 CUC, one of the most
expensive in the world if we go back and work out just how many days a
Cuban person has to work in order to pay this sum. And getting a birth
certificate, a marriage or death certificate, final wishes and an
inheritance declaration cost 50 CUC at the Legal office, and of course,
this is so it has validity abroad. But you're still paying out of a
Cuban pocket, or out of the pocket of another Cuban who had to leave the
country beforehand so as to pay for all of these authorizations, legal
fees and charges; and others.

Then you find yourself asking why a milkshake costs 25 pesos, a glass of
fruit milkshake, my God, in one of those new places that have sprung up
all over Vedado, and you drink it thinking that the 5 peso juices on
Obispo Street have a lot more flavor and are four times cheaper, but
you're not going to pay those 10 – or is it 20? – pesos that the old
collective taxis charge just so you can satisfy your palate and your
wallet, even though you have to pay 25 CUC this afternoon to the man who
put in your window even though you bought all of the materials needed.

"Everybody wants my money," Meryl Streep says in the movie Music of The
Heart where she plays a violin teacher, and I imagine that this is a
global issue, but do all currencies have this irrational exchange rate?
This unscrupulous reality? This feeling that you're being taken
advantage of? And most of all, in a society where we supposedly fight
for the complete opposite?

"They steal from you when you're sitting in front of the TV and they
steal from you when you're at a counter, and they rob your will, your
will to love," sings Carlos Varela, and it pains me to admit that the
project has been twisted to such an extent, and I become overwhelmed
with despair.

Source: In Cuba Everybody Wants My Money - Havana Times.org -
http://www.havanatimes.org/?p=122759 Continue reading
The Socioeconomic Legacy Of Fidel Castro / Miriam Leiva

ABC International, Miriam Leiva, 26 November 2016 — Fidel Castro left
Cuba in disastrous economic conditions after exerting absolute power for
more than 47 years. His brother received a country "on the precipice" on
31 July 2006.

Raul Castro has had to eliminate the "genial" initiatives of the
comandante en jefe, without repudiating them, presenting it as an update
of the economic model, always inspired by Fidel's ideas. In fact, his
speeches and aphorisms were so many that he could use them according to
his needs. However, most Cubans are convinced he squandered them in his
great failed works and caused the most comprehensive crisis in the
nation's history.

While arguing he was defending Cuba's sovereignty, Fidel Castro was
strengthened in power by economic dependence on the Soviet Union and
Venezuela; he depreciated the value of labor; he impoverished the
population; he destroyed moral and civic values; he extinguished hope
for a solution and increased the exodus abroad, mainly of young people,
with very serious implications for the future of the country.

At the time of the triumph of the Revolution in 1959, Cuba shared with
Argentina, Uruguay, Chile, and Costa Rica the most advanced economic and
social indicators in Latin America and the Caribbean. Although it did
face challenges, such as a slow rate of growth; excessive dependence on
the sugar industry; outsized economic ties with the United States,
particularly in investment and trade; high rates of unemployment and
underemployment; significant inequalities in living standards,
especially between urban and rural areas; unjust distribution of land,
with extensive estates, poorly cultivated; and a lack of industrial
development and infrastructure, among others.

Rupture

Fifty-five years later, reality indicates that the problems inherited
from the pre-revolutionary period were not solved. The breaking off of
economic and trade ties with the United States did not lead to the
achievement of independence in these areas.

The Soviet Union and its allies replaced the United States until 1989,
when the USSR disappeared and there began a period of great shortages
that Fidel Castro called "a special period in times of peace." GDP fell
by a third between 1990 and 1994. Castro authorized, though with strong
restrictions, farmers markets, tourism, a certain independence of state
enterprises and foreign investments. But he reestablished restraints
when Venezuela's strong petro-dollar contributions began.

Without sugar

One of Castro's most notable disasters was the destruction of the sugar
industry, which began with the failed plan for a "10 million harvest" in
1970. Several years of preparation leading up to the grand plan
annihilated the country's non-sugar agriculture production and damaged
livestock farming in favor of sowing sugar cane and huge investments in
mills, which were not ready in time.

In 2002 he decided to restructure the 156 remaining sugar centers,
dismantling 85 mills, 21 of them supposedly dedicated to producing honey
or tourism. This involved the demolition of cane fields, the destruction
of roads, the dispersion of experienced personnel and the decline of
villages.

Cuba had been the largest producer and exporter of sugar in the world,
with more than 6 million tons in 1959 and 8.2 million tons in the 1980s,
which fell to 1.1 million annually, without being able to recover
despite the reorganization. In 2013, 49 plants operated, producing about
1.6 million tons (similar to 1909). Cuban culture and nationality
developed with this industry, starting in the seventeenth century. In
those days it was said, "without sugar there is no country."

Land confiscated after 1959 was not used efficiently. The state-owned
estates created have been more unproductive than the previous ones.
Agriculture remained for many years with enormous tracts of land poorly
cultivated, empty or overrun by the invasive marabou weed.

Production levels in relative terms do not exceed what was achieved per
inhabitant before 1959, with about 80% of the food that makes up the
much-reduced basic food basket now imported, despite the leasing of land
to private farmers and cooperatives since 2008.

Cuba had more than 7 million head of cattle, but today the number does
not exceed 4 million, with a substantial decrease in the production of
meat and milk.

Manufacturing has a production volume equivalent to 43% of that obtained
in 1989. The average monthly salary and pension at the end of 2014 were
467 and 269 pesos respectively (the equivalent of 15 and 10 euros at the
official exchange rate).

In order to survive, Cubans depend on remittances from family abroad,
work in areas related to foreigners – where they can earn generous tips
– or the informal market, all of which has led to a growing loss of
ethical and moral values ​​due to deception, theft and illicit
activities. The elimination of accounting, contracts and other practices
in the 1960s prompted a great lack of control and administrative
corruption, which Raul Castro is attempting to eliminate through the new
Comptroller General of the Republic.

Without goods to export

In July 2007, Raul Castro acknowledged the need for structural and
conceptual changes, which are contained in the "updating of the economic
model, without haste but without pause." However, the changes have been
few, limited and late, and the economic levels of 1989 have not been
regained.

In the last 24 years, the investment rate has been very low, causing a
process of decapitalization. There are no savings or access to credits
due to the unreliability of repayment. The new Mariel Special
Development Zone is intended to bring in 2.5 billion dollars annual in
foreign investment, which has not been achieved. The Minister of Economy
and Planning acknowledged in July 2014 that "the economy grows in
relation to 2013, although it does not reach the expected levels, which
leads to a greater deceleration than expected."

With virtually no goods to export, Cuba has become a supplier of skilled
labor abroad, in particular health workers which are "leased" to other
countries, and which has become the country's main source of foreign
exchange earnings. Characterized as having an advanced population, today
the country exhibits a generalized technological backwardness, which
places it behind the nations of the region on crucial issues such as
internet access.

Progress at the beginning of the Revolution in public health and
education has deteriorated. These vital sectors are set back by the lack
of resources due to the crisis; at the same time graduates and
specialists, generally poorly utilized and underpaid, prefer work that
requires lesser qualifications but is better paid (for example, in the
tourist sector), or choose to leave the country.

Colossal catastrophe

The dreams awakened by Fidel Castro as the Maximum Leader of the process
begun on January 1, 1959 have ended in a great nightmare, a catastrophe
of colossal magnitude. He squandered the opportunity to leave a legacy
of progress and well-being for the Cuban people, prioritizing his
desires to satisfy immense longings for absolute power and an
uncontrollable delirium of grandeur.

Source: The Socioeconomic Legacy Of Fidel Castro / Miriam Leiva –
Translating Cuba -
http://translatingcuba.com/the-socioeconomic-legacy-of-fidel-castro-miriam-leiva/ Continue reading
ABC International, Miriam Leiva, 26 November 2016 — Fidel Castro left Cuba in disastrous economic conditions after exerting absolute power for more than 47 years. His brother received a country “on the precipice” on 31 July 2006. Raul Castro has had to eliminate the “genial” initiatives of the comandante en jefe, without repudiating them, presenting … Continue reading "The Socioeconomic Legacy Of Fidel Castro / Miriam Leiva" Continue reading
In the tourism sector, reversing the U.S. opening to Cuba would be counter to U.S. interests, argue Richard Feinberg and Richard Newfarmer Continue reading
Andres Oppenheimer: Prospects for Cuba don't look good

Now that Fidel Castro is gone and the leaders of Canada, Mexico and
other countries have made fools of themselves by praising the alleged
accomplishments of a dictator who destroyed his country's economy and
executed thousands of people, it's time to take a look at Cuba's future.
It doesn't look good.

In theory, things should get better. President Raúl Castro, 86, has
proved to be more pragmatic than his older brother. He could have an
easier time implementing the much-needed economic reforms that he
announced at the VI Congress of the Communist Party in 2011 and that he
vowed to speed up at the VII Congress this year.

Raúl Castro's small steps toward a Vietnam-styled, state-run form of
capitalism were slowed down because of resistance from Fidel, who
remained a powerful figure behind the throne. Without Fidel, the
hard-line "Fidelistas" would have less power to stop the reforms, the
theory went.

But most economists now agree that Raúl Castro faces a perfect storm of
bad news that will make it difficult for Cuba's economy to get back on
its feet.

"Cuba suffers today its worst economic crisis since the nineties," says
economist Carmelo Mesa Lago, a professor emeritus of the University of
Pittsburgh. "The projections are that the economy will stagnate or
decline in 2016, and that the situation will worsen in 2017."

First, Venezuela's subsidized oil shipments to Cubafell by about 40
percent during the first six months this year, according to a Reuters
news agency report. Venezuela's economy is in a shambles because of the
decline in world oil prices and disastrous economic policies, and its
oil subsidies to Cuba are likely to continue falling, experts say.
Second, Cuba's exports of medical services — a kind of modern-day slave
trade through which the Cuban regime sends tens of thousands of
physicians to Venezuela, Brazil and Angola— may be endangered. Venezuela
has a hard time paying for these services, and Brazil's new center-right
government may not renew these government-to-government contracts.

Third, Cuba's production of nickel and sugar is depressed because of low
commodity prices and the destruction of the country's industries over
the past 60 years. And, thanks to Fidel Castro's revolution, Cuba today
imports more than 70 percent of its food.

Fourth, tourism — the island's biggest hope since President Obama's
opening to Cuba in 2014 — may decline if U.S. President-elect Donald
Trump follows through with his Nov. 28 threat to "terminate" Obama's
deal with the island. The return of U.S. airlines and cruise ships
filled with American tourists to Cuba over the past year had helped
drive uptourism.

"The most optimistic forecast for Cuba is that after a few decades of
struggle and reorientation, it will end up at the income level of the
Dominican Republic," wrote George Mason University economics professor
Tyler Cowen in the Miami Herald.

He added that while the World Bank estimates Cuba's GDP at $6,000 per
capita, that measure is based on an unrealistic exchange rate. Cuba's
real GDP is more likely not much higher than Nicaragua's $2,000 per
capita, he said.

"Had Cuba not had a communist revolution is 1959, it could have been one
of the most successful Latin American economies," Cowen wrote.

Instead of praising a dictator who didn't have the courage to compete in
a free election in nearly six decades, the leaders of Mexico, Canada and
other countries should have cited Cuba's revolution as an example of a
failed economic model, which is going from bad to worse.

If Trump plays his cards well he will leave Cuba alone. Raúl Castro is
scheduled to step down in early 2018, and his successors may have to
concede what the vast majority of Cubans have already concluded: that
communism is the longest — and bloodiest — road between capitalism and
capitalism.

Andres Oppenheimer is a columnist for the Miami Herald.

Source: Andres Oppenheimer: Prospects for Cuba don't look good |
SavannahNow -
http://savannahnow.com/opinion-opinion-columns/2016-12-05/andres-oppenheimer-prospects-cuba-don-t-look-good Continue reading
Cubanet, Miriam Celaya, Havana, 7 September 2016 — In recent days, the Cuban official media announced the implementation of a tax on personal income for workers in the State’s business sector, as well as an extension of payments called Social Security Special Contribution (CESS) – that workers at the so-called “perfecting entities” were already paying … Continue reading "The End of Freebies by the Revolution / Cubanet, Miriam Celaya" Continue reading
Is This the Second Phase of Cuba's Special Period? / Iván García

Joel, a fifty-five-year-old engineer, remembers the summer of 1994 when,
after finishing his day job, he came home to roast two or three pounds
of peanuts. After packaging them in paper cones fashioned from the pages
of school textbooks, he went out to sell them on the street and make a
little extra money.

As a result of sudden inflation, his salary lost its purchasing power.
"At first I was embarrassed," he recalls. "I was a skilled professional,
but I had to feed my children. The Special Period was terrifying. The
peso's value evaporated. My wife and I had to look for other options to
survive. I sold peanuts and she became a landlady."

Cubans over twenty-five would like to forget this period of daily
twelve-hour blackouts, one meager hot meal a day and a primitive,
subsistence economy. The Special Period most closely resembled a war
without aerial bombardment.

Oxen replaced tractors and public transportation turned into an ordeal.
Cats, frogs and pigeons became sources of protein in the family diet.
Along with food shortages, Cubans had to get around by taking long walks
or pedaling heavy Chinese bicycles. People lost weight. Others fainted
due to malnutrition and many became ill.

The dollar soared. The exchange rate was one dollar for 150 pesos. An
avocado cost 100 pesos and a pound of rice went for 120. The constant
pressure of Fidel Castro's unbending single-mindedness erupted in the
so-called Maleconazo* on August 5, 1994. This mass uprising in Havana
was sparked because men and women of all ages were desperate to emigrate.

Then came Hugo Chavez. He was like a Caribbean Santa Claus. An
ideological ally of Fidel Castro, he hooked up the island to a petroleum
pipeline.

Officially, the ongoing economic crisis in Cuba has not ended, though
inflation has been reduced. Modest reforms have allowed small private
businesses to open and independent farmers to sell surplus produce at
market-rate prices, which have improved daily life.

But now people suspect that, given the economic, social and political
crisis in Venezuela, we may once again be seeing a period of extensive
blackouts, malnutrition and a 35% contraction in GDP looming on the horizon.

Sources have confirmed to Marti Noticias that, starting on July 1, a
series of cuts to public services will be implemented. Luis Alberto, a
bus driver in Havana's Lawton district, says that "in the coming days
the number of trips along various routes will be reduced in order to
save fuel. Some drivers will be laid off and will have to join work
brigades or fumigate houses in the fight against the Aedes aegypti
mosquito."

Daniela, an employee of the telecommunications monopoly ETECSA, says
that "after a company meeting it was decided to make some adjustments.
The amount of fuel for transport will be reduced. Air-conditioners in
offices will be turned off after 2:00 PM. Some staff will see their
salaries and work schedules cut by half or will be assigned to other
duties. It won't affect all branches of ETECSA, though. Crews working on
the internet pilot plan in Old Havana, for example, will not see cuts."

Nuria, an official at the electric company says, "New measures are
definitely being taken to reduce fuel and electricity consumption but
not to the degree that many people think. For now, there are no
scheduled blackouts planned. The electrical distribution network is
powered by domestically produced diesel and is not dependent on
Venezuelan oil. But if fuel consumption targets in all the provinces are
not met, there could be blackouts."

A worker at CUPET, the state petroleum company, points out, "So far,
there has been no reduction in the number of barrels of oil imported
from Venezuela. But it is true they have taken measures to reduce fuel
consumption, which has shot up, and to have a larger reserve in case
there are negative developments in Venezuela."

"And what if Nicolas Maduro and his party lose power through a recall
vote and the Venezuelan opposition cancels the energy contracts? Is the
Cuban government prepared to deal with the loss of this supply?" I ask him.

"I assume the government is prepared for this eventuality but I don't
have any evidence to support this," he adds.

Conrado, an economist, does not believe this amounts to a second phase
of the Special Period but the Venezuelan crisis and the contraction of
the Cuban economy in 2016 are worrying signs.

"There's no denying that, if the state of affairs in Venezuela were to
change, our economy would suffer," says the economist. "But it wouldn't
be like the years that coincided with the collapse of the USSR and the
Soviet bloc in Eastern Europe. Imports and exports are more diversified
now than they were then. I must add, however, that the country's
purchasing power does not allow it to buy ninety to a hundred barrels of
oil a day on the world market, even with prices at less than thirty
dollars a barrel. In the worst case scenario there could be significant
fuel reductions in some industrial and service sectors, and blackouts
might return, though they would not be as prolonged as they were before."

For Carlos, a sociologist, the million-dollar question is whether people
are prepared for a new period of shortages and blackouts.

"Since 1994, the harshest year of the Special Period, more than 800,000
Cubans have emigrated, either legally or illegally. The country has felt
the impact. The emigres included professionals and, more significantly,
young people. There was no sector of society — whether it be sports,
culture or industry — that has not suffered significant losses due to
the exodus."

He adds, "The aging of the population and the dissatisfaction of most
citizens with what they consider to be a bad government places Cuba in a
different context today than it was in twenty years ago. In spite of
Raul Castro's economic reforms, emigration has increased. And another
Special Period, no matter how mild, would increase social anxiety, which
is already quite high. In a hypothetical situation like this, the
reaction cannot be predicted."

Faced with the silence of the official press, Havana residents often
turn to the internet to communicate with family members and friends
overseas and to search for information on international and independent
Cuban websites. This was the case with Elvira, a sixty-six-year-old
retiree who — after reading the article "Alarm in Cuba" on the
Florida-based Cuban news website Cubanet — decided to look further into
the alarming news.

"A few days later, I read a Reuters article about anticipated
electricity and fuel cuts in Cuba," she says. "For me this confirmed
that things are serious. To be forewarned is to be forearmed. I told my
children that we must be prepared for this Special Period so that we are
not as unprotected as we were the last time."

Misinformation generates rumors. Cuban state media tries to control them
by offering the public clear explanations about the country's 2016-2017
economic and financial situation.

It is the least they can do for those Cubans who who lived through the
era, labelled by Fidel Castro the "Special Period in a Time of Peace,"
as well as for those who are too young to remember it.

Neither Joel the engineer nor Elvira the retiree think there will be a
new Special Period, barring "a time of war." But neither do they believe
the government has a Plan B to deal with the approaching storm.

Marti Noticias, July 4, 2016

*Translator's note: A spontaneous demonstration named for the seaside
promenade and avenue where it began. After Cuban authorities seized four
boats headed to the United States without authorization, demonstrators
attacked police, looted stores and shouted anti-government slogans. It
later spread to other parts of central Havana and over one-hundred
people were arrested before it was put down. It served as a prelude to a
mass exodus from the country which occurred later that year.

Source: Is This the Second Phase of Cuba's Special Period? / Iván García
– Translating Cuba -
http://translatingcuba.com/is-this-the-second-phase-of-cubas-special-period-ivn-garca/ Continue reading
Joel, a fifty-five-year-old engineer, remembers the summer of 1994 when, after finishing his day job, he came home to roast two or three pounds of peanuts. After packaging them in paper cones fashioned from the pages of school textbooks, he went out to sell them on the street and make a little extra money. As … Continue reading "Is This the Second Phase of Cuba’s Special Period? / Iván García" Continue reading
A Cuba cruise travel guide: Everything you need to know before you go
BY MIKE CLARY
Sun Sentinel

So you're thinking about taking a cruise to Cuba.

As the Fathom ship Adonia launches a schedule of biweekly cruises from
Miami to Cuba, passengers will find a few changes in scheduling and
activities from the inaugural May 1 trip, the first to the island by a
U.S.-based passenger ship in nearly four decades.

Four weeks ago, when the first cruise ship in more than 50 years sailed
from the United States and around Cuba, the Sun Sentinel's Mike Clary
was aboard. He shared the story of the historic journey aboard the MV
Adonia, and you can find the reports at SunSentinel.com/CubaCruise.

With the 704-passenger ship set to leave PortMiami every other Sunday
for a weeklong voyage to Havana, Cienfuegos and Santiago de Cuba, here's
what we learned on the first cruise:

–––

Question: Is traveling to Cuba by ship a good way to see the country?

Answer: In a seven-day trip around the island, passengers spend
two-thirds of their time at sea, and only about 50 hours on the ground
in Cuba.

So a more time-efficient way to explore Cuba is to take a charter flight
directly to Havana, Santiago de Cuba or one of several other Cuban
cities and begin exploring from there. There are several ways to get
around once in Cuba: Cuba's domestic airline, state-run train or bus
systems, or rental cars.

The journey from Havana to Cienfuegos by train, bus or car takes about
four hours or less. On the Adonia, the trip from Havana to the city on
the south coast takes a full day and a half at sea as the ship sails
around the western end of the island. During that time you could be
reading about Cuba, or practicing your salsa moves to live music
onboard, but you won't be seeing Cuba.

If you do decide the cruise option isn't for you, travel agents and
charter companies in the U.S. can make reservations for travel within
Cuba before you go.

Most Adonia passengers, however, are making their first visit to a
communist-ruled island that is just being opened up to American
visitors, and many said the cruise provided a good introduction for
subsequent exploration.

Q. What are the advantages of traveling by ship?

A. After a day of exploring a city on foot, many passengers appreciated
being able to return to a floating hotel at the dock where they could
find a hot shower, a good bed in a comfortable cabin and a cafeteria
that is almost always open. Although there are fine restaurants in
Cuba's major cities, finding light fare while on-the-go touring is not
always easy. There are no Starbucks, no fast-food franchises. So the
availability of consistent and plentiful food on board can be attractive.

The cruise line also will schedule optional onboard programs related to
Cuba.

For those not comfortable wandering the streets of Cuba on their own,
Fathom offers walking and coach tours to places such as national
historic sites, organic farms and artist studios, and outside of
Santiago de Cuba, the shrine to Cuba's patron saint in the town of El
Cobre. The cost of the tours is included in the price of the voyage.

Q. What changes has Fathom made as a result of the first cruise?

A. Cuban tour guides are to get more training after complaints they were
too inflexible and too stingy with information, and onboard programs on
Cuban art, architecture and music will be beefed up, according to
officials of Carnival Corp.'s Fathom brand.

Perhaps most importantly, passengers will be told they are free to leave
conducted tours to wander around on their own.

Travelers also will be offered more choices of activities and
restaurants in each of the Adonia's stops in Havana, Cienfuegos and
Santiago de Cuba.

Q. What is the ship like?

A. Launched in 2001, the Adonia has a capacity of 704 passengers, with a
crew of more than 350. It is smaller than many cruise ships, enabling it
to get into ports such as Havana, too shallow for bigger vessels. Many
of the senior officers are British, and the crew includes men and women
from more than 20 nations, including India and the Philippines.

The Adonia does not have a casino, and there are no Broadway-style
shows. What it does offer, in addition to cruise ship basics such as a
swimming pool, workout room, restaurants and bars, are various classes,
such as Spanish, yoga, Cuban history, meditation and storytelling.

Q. What is the difference between Adonia's three stops, Havana,
Cienfuegos and Santiago de Cuba?

A. Passengers spend two full days in the Cuban capital of Havana, a
sprawling city of more than 2 million. The historic attractions are
many, the restaurants and privately run "paladares" catering to tourists
first-rate, and there are plenty of taxis, tour guides and shows to see.
In a visit that lasts a total of 36 hours, passengers can get only a
taste of the largest city in the Caribbean, a dynamic cultural mecca
founded in 1514.

Cienfuegos, the Adonia's second stop, is a city of 150,000 residents,
filled with charm and French-influenced neoclassical architecture. Known
as the "Pearl of the South," Cienfuegos invites casual exploration, but
the stop here is brief – just six hours. Many travelers said they would
have enjoyed more time here.

Cuba's second-largest city, Santiago de Cuba, on the island's eastern
end, is the home of rum and revolution. Flanked by the Sierra Maestra
mountain range, this is where Fidel Castro launched the revolution in
the early 1950s, and is a city with distinctive Afro-Cuban cultural
influences. There is much to see – the old Bacardi factory, and the tomb
of José Martí, for example – but Adonia passengers are on the ground for
only about eight hours. As in Cienfuegos, the stop here is brief,
forcing travelers to make hard choices about how to use their time.

Q. Can I plan my own trip to Cuba?

A. Yes. You can book a flight to Cuba through a charter service. The
flight from Miami to Havana takes about 45 minutes. The average
round-trip fare: $400. The U.S. and Cuba have agreed to license 20 daily
flights to Havana and 10 each to nine other Cuban cities. American
Airlines, JetBlue and several other airlines are applying for those
routes, but they have not been assigned. So you cannot yet call up an
airline and book a flight.

Q. Are hotel rooms available and what are they like?

A. Hotel rooms in Cuba can be in short supply, especially during the
winter season, from November through April. A room at Havana's famed
Hotel Nacional, for example, goes for about $300 U.S. a night. But there
are many rooms for rent in private homes for as little as $30 a night,
often with breakfast. Airbnb, a U.S. website that lists rental lodging,
also now operates in Cuba.

The big hotels in Cuba, including many operated by the Spanish firm
Melia, are very similar to big hotels anywhere. They offer restaurants,
bars, room service and Internet connections. But for a more intimate
look at Cuba, many travelers prefer to stay in private homes, known as
"casas particulares," which are licensed by the government. In these
casas, interactions with residents are often personal. The residents can
tell you about local eating places, share family stories, and talk about
the daily economic struggles of Cubans who have no access to visitors
and tourist dollars.

Q. What about car rentals and driving around Cuba?

A. Rental cars are available, but driving even Cuba's major highways can
be a challenge, thanks to potholes, roadside vendors and free-ranging
animals, not to mention trucks that frequently stop to pick up Cubans in
need of a ride. Signage is inconsistent, and finding your way around the
interior of maze-like cities such as Camaguey can be frustrating.

To explore a city or local region – especially for those without good
Spanish or experience on the island – hiring a car and driver might be a
better option. Negotiate the rate.

Q. Will I need to get a visa before I go to Cuba?

A. Visitors to Cuba are required to have a visa. When you book a trip to
the island, Fathom and other tour operators provide the visas at an
average cost of about $80. Cuban-born travelers who came to the U.S.
after 1970 are required by the Cuban government to have a Cuban passport
in addition to their U.S. passport. The cost of the visa and passport
for those travelers is about $430.

Q. Who can go to Cuba?

A. Americans can go to Cuba as a member of a tour group or as an
individual traveling under one of the 12 categories authorized by the
U.S. government. Those categories include family visits, religious,
educational or humanitarian activities, journalism and professional
research.

Before leaving port, passengers are asked by Fathom to check a box on an
affidavit that most matches the purpose of their trip. But passengers
also may declare they are going on a Fathom-guided program, and agree
that they "will participate in the full-time schedule of educational and
people-to-people exchange activities arranged by Fathom."

This led to some confusion and complaints during the first days in
Havana when some passengers wanted to drop out of the walking tours and
return to the ship. Some tour guides, provided by Fathom's Cuban
partner, the state-run Havanatur agency, told travelers they could not
leave the group. Fathom quickly issued a clarification that passengers
could "self-certify" that they are following U.S. regulations and do
whatever exploring on their own they choose.

No one is watching individual travelers to see if they are engaging in
so-called "people-to-people" activities while on the ground in Cuba. In
effect, the only remaining U.S. ban is on tourist activities, such as
spending all your time at a beach resort.

Q. Is Cuba safe?

A. Yes. Although Cuba doesn't report crime statistics and state-run
media rarely cover crime, rates of violent crime on the island are
considered low, especially compared to the U.S. Violent crimes against
visitors are rare. Uniformed police are visible on the streets in areas
where tourists usually go.

At the same time, Cuba is governed by an authoritarian regime that
restricts speech and assembly. On its website, the U.S. State Department
warns that the Cuban government has detained U.S. citizens it suspects
of engaging in activities perceived as a threat to state security.

Q. Are Cubans welcoming to American visitors?

A. Yes. In all three cities, people greeted Adonia passengers warmly and
seemed eager to engage. The enthusiastic greeting from hundreds of
high-fiving Cubans at the dock in Havana was the highlight of the
journey for many passengers. At Cienfuegos and Santiago de Cuba, there
were many fewer people at the dock, but there were groups providing
traditional music and dancing, and the welcomes were festive.

Q. Is not being able to speak Spanish a problem?

A. The state-run Cuban tourist agencies have guides trained in English,
French, Italian and other languages spoken by visitors from various
countries. Off the beaten tracks, especially in the Cuban countryside,
most Cubans do not speak English. But the friendliness and eagerness of
the Cuban people to engage with arriving Americans made for memorable
encounters even among those who did not have a common language. For
example, Fathom passengers stopped in at barber shops for haircuts,
bought fruit or souvenirs from street vendors far from the central
plazas, and were invited into the homes of people they ran into while
exploring on their own.

Q. Will my cellphone work in Cuba?

A. Some U.S. carriers have or are beginning to make agreements with
ETECSA, the Cuban national telecommunications company, to provide
roaming services in Cuba. Sprint and Verizon, for example, currently
offer roaming services in Cuba.

Specialized mobile phone companies such as Cellular Abroad, Cello Mobile
or Mobal rent phones for use in Cuba, according to the Federal
Communications Commission's website. Fees average $3 per minute of call
time and up to $1.50 per outgoing text message.

You can also rent a Cuban cellphone from Cubacel, ETECSA's mobile phone arm.

Q. What about Internet connections?

A. Many of the larger hotels and resorts across Cuba offer WiFi, as do
scattered Internet cafes, charging varying hourly rates. Increasingly
there are also government-provided hot spots on the street, marked by
groups of Cubans sitting or standing while working their cellphones.
WiFi access costs about $2 an hour, but you need to buy an access card
at ETECSA.

Aboard the Adonia, Internet service is available for 50 cents a minute
or through a package buy of 250 minutes for $62.50.

Q. Can I spend U.S. currency and use my credit cards in Cuba?

A. Cash is king in Cuba. Cuba has two forms of currency, the convertible
peso, called CUC and used by tourists, and the Cuban peso, used by
Cubans in the markets and ration stores. Money can be changed at the
airport, Havana's seaport and at CADECA exchange houses located in every
city in Cuba.

Although the exchange rate is about 1 U.S. dollar to one CUC, Cuba
imposes a penalty on changing U.S. dollars. Result: $1 U.S. equals about
87 cents in CUC. (Some travel websites advise changing U.S. dollars to
British pounds or Canadian dollars before leaving for a better exchange
rate in Cuba.)

With few exceptions, U.S. credit cards are not accepted.

Q. What can I bring back from Cuba?

A. Travelers returning to the U.S. from Cuba can bring home up to $400
worth of goods acquired for personal use. This includes no more than
$100 worth of alcohol or Cuba's famous cigars.

Q. So how much rum and how many cigars will $100 buy?

A. That depends. The best Cohiba and Montecristo cigars are pricey. But
for $100 you can come home with a bottle or two of Havana Club rum and a
handful of the less expensive smokes.

Q. What should I bring that I might not have thought of?

A. The availability of fast food and sanitary conditions of public
toilets in Cuba may not be what most Americans are used to. Tissues,
hand wipes, and easy-to-carry snacks such as granola bars are easily
packed. Comfortable walking shoes are a must. And it is hot, hotter than
Florida. Bring hats, sun screen. Bottled water is usually available for
purchase for about $1.

Q. Cruises can be susceptible to outbreaks of illness. What should I do
to stay healthy?

A. Wash your hands, thoroughly and often. A small outbreak of suspected
gastroenteritis was reported on the last full day of the Adonia's
inaugural cruise. Hand-sanitizing stations are available throughout the
ship, which follows U.S. Centers for Disease Control and Prevention
guidelines for reporting and combating any suspected contagions.

Q. What does a voyage to Cuba on the Adonia cost?

A. Fares start at about $2,700 per person for an interior cabin, and
rise to about $4,000 for an outside cabin with a balcony. Suites start
at about $8,000. While at sea, all meals were provided. In port,
breakfast and dinner were served onboard, while lunch at a Cuban
restaurant was included as part of a guided tour.

Q. So, in conclusion, how was the visit?

A. Cuba is complex, endlessly fascinating, and impossible to fathom in a
visit that is at least partially scripted and measured in hours. Yet
aside from some complaints about the scheduling and conduct of tours and
some confusion over what travelers were permitted to do on their own,
many Adonia passengers said they enjoyed the trip. And that was chiefly
due to their interactions with the Cuban people.

As Sherlock Robinson, a 66-year-old former New York City photographer,
said, "The warmth of the people of Cuba, the reception they gave us, and
then everywhere we went in Havana showed that they have a wonderful
spirit about them. And you don't see that anywhere else."

Source: A Cuba cruise travel guide: Everything you need to know before
you go | In Cuba Today -
http://www.incubatoday.com/news/article80771822.html Continue reading
Central Bank Denies Rumor About Devaluation Of Cuban Convertible Peso /
14ymedio

A line outside a currency exchange (Cadeca) Friday, amid rumors of a
reduction in the value of Cuban convertible pesos CUC. (14ymedio)
14ymedio, 29 April 2016 — The Central Bank of Cuba on Friday denied a
possible reduction in the value of the Cuban convertible pesos. State
financial institution reported that "the exchange rate remains at 24
Cuban pesos per one Cuban convertible peso for sales of CUC by the
population at banks and Cadeca (currency exchanges)."

For several days the lines in front of currency exchanges had been
lengthening due to the growing rumors of a fall in the value of the CUC.
However, the Central Bank says the rumor as "false information about the
reduction in the exchange rage that is currently applied."

The explanatory note published in the official press notes that "the
report to the 7th Congress of the Cuban Communist Party confirmed, once
more, the decision to guarantee bank deposits in foreign currency, Cuban
convertible pesos (CUC) and Cuban pesos (CUP, as well as cash held by
the population."

Source: Central Bank Denies Rumor About Devaluation Of Cuban Convertible
Peso / 14ymedio – Translating Cuba -
http://translatingcuba.com/central-bank-denies-rumor-about-devaluation-of-cuban-convertible-peso-14ymedio/ Continue reading
14ymedio, 29 April 2016 — The Central Bank of Cuba on Friday denied a possible reduction in the value of the Cuban convertible pesos. State financial institution reported that “the exchange rate remains at 24 Cuban pesos per one Cuban convertible peso for sales of CUC by the population at banks and Cadeca (currency exchanges).” For … Continue reading "Central Bank Denies Rumor About Devaluation Of Cuban Convertible Peso / 14ymedio" Continue reading
No 'Privatization' or Other Political Parties, says Raul Castro / 14ymedio

14ymedio, Havana, 16 April 2016 – In a room with huge images of Carlos
Balino, Julio Antonio Mella and Fidel Castro, the Seventh Congress of
the Cuban Communist Party opened in Saturday. Jose Ramon Ventura, Second
Secretary of the PCC Central Committee, offered the opening words, in
front of 995 delegates – of the 1,000 elected – present at the Palace of
Conventions. Five delegates are not participating in the great event,
among them the former Cuban president.

A few minutes into the event there was the first unanimous vote, in this
case to approve the agenda. Raul Castro gave a speech of a little more
than two hours, the main report dressed in civilian clothes, and
recalled the days of the Bay of Pigs, emphasizing the role of State
Security in this military victory.

The Cuban president warned that the island will never follow "formulas
of privatization" or apply "shock therapy" during the so-called process
of updating the economic model. "Cuba can allow itself to apply the
so-called shock therapy, frequently applied to the detriment of the most
humble classes of society," he said.

Referring to Article 5 of the Cuban Constitution in which the Communist
Party is enshrined as the highest leading force of society, Castro
affirmed that "we have a single party and I say that with pride." The
first secretary of the PCC affirmed that "it is no coincidence that they
attack us and demand, in order to weaken us, that we divide ourselves
into several parties in the name of bourgeois democracy."

However, for those who speculate that the party meeting will be the
stage to announce the legalization of other political forces, Castro
emphasized that "if they succeed in fragmenting us it will be the
beginning of the end of the fatherland, the Revolution and socialism."

The president proposed to establish "60 years as the maximum age to join
the Party Central Committee," and also noted that "up to 70 years" would
be the time to hold senior Party positions."

The report detailed that there are 670,344 PCC militants. The reduction
in their number was attributed by Raul Castro to demographic reasons, to
a policy restricting growth in the organization since 2004, and
deficiencies in the work of recruiting and retaining members.

To justify the secrecy and lack of consultation that has surrounded the
documents to be discussed during the Congress session, Castro said that
unlike the previous Congress when the people were consulted on the
Guidelines, this time a popular consultation was not undertaken, because
it was a confirmation and continuation" of the line agreed to five years
ago.

With regards to the "main course," announced as a national development
plan to the year 2030, which is "the fruit of four years' work," it
"could not be finished," declared the president and there would be
continued "work on its drafting" which would end in 2017.

Similarly, there will be not discussion of the so-called
"conceptualization of the model" but there will be a prior discussion
with the participation of the Party militants, the Union of Young
Communists (UJC) and the mass organizations, so that later the Central
Committee can approve the final version.

The slowness in implementing the Guidelines approved by the previous
Congress, of which only 21% have been completed, also found a
justification in Castro's words when he warned that it was known ahead
of time that the process "would not be easy." "The main obstacle has
been the burden of an obsolete mentality which creates an inertia and
lack of confidence in the future," he said.

The "socialist state enterprise is in a disadvantageous position
compared to the non-state sector," Castro admitted. The distortion
brought about the by dual currency system along with the low-key
performance of the economy are the causes "that have not allowed the
application of the agreement about improper gratuities and subsidies
because a widespread wage increase has not been possible."

Castro announced a program of "improving the education system" and said
that the public health system will be reorganized to "increase its
quality and make it efficient and sustainable."

Calls for "more discipline and exigency" were also heard during the
reading of the report because "ears and feet must be firmly planted on
the ground," explained the first secretary of the PCC.

The cold water also came for those who expected announcements about an
early reunification of the dual currency system. The update of the
"monetary and exchange rate is a matter that we have not stopped on
working on and whose solution will not be left for the twelfth of
never," explained Castro. He commented that this reordering will
eliminate "the harmful effects of egalitarianism" so that "the standard
of living corresponds to the wage income." He also confirmed the
decision to guarantee "bank deposits in international currencies, in
Cuban convertible pesos and in Cuban pesos, as well as the cash held by
the population."

"We are not naïve nor do we ignore the aspirations of powerful external
forces that are committed to what they call the empowerment of non-state
forms of management with the intent of generating change agents to put
an end to the Revolution by other means," added Castro, who, however,
declared that it is necessary to set aside "prejudices" with respect to
foreign investment and to advance into new businesses.

With regards to Guideline 3, which states unequivocally that non-state
forms of production will not permit the concentration of ownership, he
now added that not will it concentrate wealth.

However, Castro explained that the concept of private property over the
means of production for small businesses is widened, although he
insisted that the fundamental means of production must be in the hands
of the people.

In conclusion, the General expressed a wish that from this Congress
"will emanate the principal directions of our work."

Starting Saturday afternoon, the Congress delegates will work in four
committees, which will also meet on Sunday in the Palace of Conventions
in Havana. The Congress will look at 268 Guidelines of those approved at
the prior congress: 31 original guidelines, 193 that have been modified
and 44 that have been added.

On Monday, all participants will meet in a plenary session and vote on
the nomination of the Party Central Committee. On that day the members
of the Politburo and the First and Second Party Secretaries will also be
announced.

Source: No 'Privatization' or Other Political Parties, says Raul Castro
/ 14ymedio – Translating Cuba -
http://translatingcuba.com/no-privitization-or-other-political-parties-says-raul-castro-14ymedio/ Continue reading
UK Only Article:&nbsp; standard articleIssue:&nbsp; The great distortionFly Title:&nbsp; Cuba’s economy (2)Rubric:&nbsp; The tricky task of unifying a crazy system of exchange ratesLocation:&nbsp; HAVANACUBA has two currencies and a mind-boggling number of exchange rates. So when President Raúl Castro set out four years ago to unify the currency system by 2016, it was not surprising that he gave few details on how he would achieve it. A year in advance, it is still not clear. Nor is there a fixed date. Cubans call the unknown day of reckoning Día Cero (“day zero”). The main difficulty is not unifying the two currencies per se. They are the Cuban peso, which most people use, and the convertible peso (CUC), worth about $1, which is a dollar substitute used by individuals in tourism, for remittances and in the private sector. It would be relatively easy for the average Cuban to scrap the CUC and conduct all transactions in pesos. Already many goods can be bought with either currency. The exchange rate for the peso is 24 per ...<div class="og_rss_groups"></div> Continue reading
Lowering the price of milk does not satisfy buyers / 14ymedio, Rosa Lopez
Posted on April 28, 2015

14ymedio, Rosa Lopez, Havana, 28 April 2015 – In Cuba it is cheaper to
buy a liter of rum than a kilo of powdered milk. Ever since convertible
currency stores appeared in the nineties, people have been demanding
price reductions for basic products. In its Monday edition, the
Communist Party newspaper Granma announced a price reduction for
powdered milk, but the measure has not been met with the satisfaction
the authorities expected.

The new measure reduces the price of kilo of powdered milk by 15% in the
hard currency stores. Now a kilo (2.2 pounds) costs 5.50 or 5.75
convertible pesos (CUCs), and a half kilo cost 2.90 or 2.80, depending
on the quality of the container. The reduction, which went into effect
on April 24, ranges from 0.45 to 0.85 CUC per packet, and is derived
from "updating import costs," according to sources at the Ministry of
Finance and Prices.

The price adjustment benefits only the small sector of Cubans who can
afford to pay the equivalent of what the average worker earns in four
days for this product. Everyone else has to abstain from drinking milk
or resort to the black market, where it is sold for a little less than
half the official price.

In the store attached to a gas station located at the corner of Boyeros
and Ayestaran Streets, several customers browsed on the Monday of the
publicized price reduction, which so far has not set off any buying
frenzy. The parishioners were wary and disappointed by how small the
price reduction was for this basic food.

Caridad Rojas has twin three-year-olds and the milk quota assigned to
them in the ration market isn't enough. After reading the note in
Granma, she went to the closest store to buy milk at the new prices.
"The truth is, what they have done is return to almost the same price
from before last year's huge price increase."

The unpopularity of the measure adopted in 2014 could be one of the
reasons the authorities decided to lower the price of the product. "They
greatly reduced sales with the increase in prices, so in the end the
State ended up losing money," said an employee at the Carlos III
commercial center, one of the largest supermarkets in Havana.

Meanwhile, milk continues to be distributed in the usual way to children
under seven and to patients prescribed special diets at subsidized
prices in the ration market. The rest of the buyers will confront the
prices of the "hard currency" stores, where they can also pay in
national pesos at an exchange rate of 1 CUC to 25 CUP (Cuban pesos, or
"moneda nacional" – national money).

Source: Lowering the price of milk does not satisfy buyers / 14ymedio,
Rosa Lopez | Translating Cuba -
http://translatingcuba.com/lowering-the-price-of-milk-does-not-satisfy-buyers-14ymedio-rosa-lopez/ Continue reading
14ymedio, Rosa Lopez, Havana, 28 April 2015 – In Cuba it is cheaper to buy a liter of rum than a kilo of powdered milk. Ever since convertible currency stores appeared in the nineties, people have been demanding price reductions … Continue reading Continue reading
Ivan Garcia, 6 April 2015 — Without being an expert in economic matters or the Wall Street currency market, Erasmo likes to trust his instincts. For fourteen years he has been engaged in buying and selling dollars and euros. Also convertible … Continue reading Continue reading
We are all used to inflammatory and misleading media reports, for example: where a minimal drop in the exchange rate of 0.3% requires the word "plummet" to describe the change, when we are told that Continue reading
We are all used to inflammatory and misleading media reports, for example: where a minimal drop in the exchange rate of 0.3% requires the word "plummet" to describe the change, when we are told that Continue reading
Without Confidence in the Money / 14ymedio, Reinaldo Escobar
Posted on February 4, 2015

14ymedio, Reinaldo Escobar, Havana, 3 February 2015 – Any day can be the
eve of a celebration or a disaster, as much for those who hurried to
exchange their convertible pesos (CUC) to Cuban pesos (CUP – also known
as moneda nacional, or "national money") as for those who are purchasing
foreign currencies or who are trusting enough to think that everything
is planned and calculated so as not to cause anyone any harm. Although
its proximity can almost be smelled, the "final battle" of the end of
the dual currency system continues to be a mystery and the present lack
of transparency can endanger its presumed strategic objectives.

Those who have a good memory or who have dedicated time to digging
through our recent history know that the Law 963, passed on 4 August
1961, established the "obligatory exchange of currency" for bills of a
new design. That surprising operation took place on Sunday the 6th and
Monday the 7th of August 1961. No one was able to leave or enter the
country on those two days. Each family unit was only allowed to exchange
up to 200 pesos. Of the 1.187 million Cuban pesos considered circulating
in the country, only 724.9 million were exchanged. The rest lost its
value, vanished.

Some naïve people who had their savings inside banks trusted that their
money would be exchanged in its entirety. However, the government
decided to only hand over one thousand pesos annually, in the form of
100 a month, for ten years, even if people's accounts contained hundreds
or thousands or millions of pesos. Many of those affected by such a
drastic measure committed suicide. Such a disastrous exchange process
annihilated in one single blow not only the part of the creole
bourgeoisie that still remained on this Island, but also the entire
middle class. It ripped to shreds people's life work and savings and
also that of past generations.

Such a disastrous exchange annihilated in one single blow not only the
part of the creole bourgeoisie that still remained on this Island, but
also the entire middle class.

They say that that new currency came from Czechoslovakia, camouflaged in
large wooden boxes since the use of metal containers wasn't common in
those times. The signs on the boxes and the customs declarations
indicated that they contained spare parts for Czech-made Zetor tractors.
Two days before the exchange, the boxes were opened in secret and the
new Cuban peso was distributed to banks throughout the country.

Fifty-three years have gone by and anyone could argue that this is not
the same country as that from 1961. But the fear lies in that it is
still governed by the same people from before, who still invoke the same
"stern slogans."

The uncertainty is not only founded on reminiscences from the past; it
has solid contemporary motives. No authority has pronounced itself
officially on what will be the level of parity of the surviving currency
to foreign ones and it isn't even known whether, in the near future, it
will be possible to exchange the CUP for dollars or euros. It is also
unknown how much the State will pay for each CUC handed over by citizens
once that currency stops circulating.

Until now, the only visible advancement toward the end of monetary
duality has been the possibility of paying with CUP in stores that
previously only sold products for hard currency (the official name of
which, TRDs, stands for "foreign exchange collection stores").

In the beginning of 2015, a worker with a 480-peso monthly salary
(without access to remittances and without any other chance of getting
CUCs) would have to work 23 hours to buy two pounds of powdered milk in
one of those markets; 18 hours for a three pounds of chicken drumsticks;
another 18 hours for a pound of grams of spaghetti and 19 hours for one
quart of cooking oil. Thus, in order to pay this small bill at the
current 1-to-25 exchange rate, he will have to work a little over ten
8-hour workdays.

In the event that the illusion becomes a reality and the CUC comes to
cost 20 Cuban pesos, the worker from our example could get all that and
a little more with just over a week of labor, and if the miracle occurs
that it come down to 15, he would get everything with fewer than 5 workdays.

It is not necessary to be an economist to realize that the country is in
no condition to turn that dream into a reality. At least unless delirium
reaches the point of fantasizing that, from the secret tunnels where
today they keep the old soviet armaments, hundreds of containers of
goods surface to furnish the stores that would no longer be called TRDs,
because they wouldn't be collecting any foreign currencies at all, and
standing before whose cash registers wouldn't be today's nouveaux
riches, but the joyous working class, living decently from their salaries.

Jumping over our chimeras, other distressing questions remain: will
there be a limit to the cash that can be exchanged? Will cash be worth
the same as the money in savings accounts? No one has clarified this and
the lack of a commitment to these guarantees makes insecurity and
distrust mount even higher.

In workplaces where perks are received in CUC, beneficiaries are asking
themselves if this "stimulus" will keep the 1-to-25 exchange rates in
the national currency. In markets where the elevated prices were once
justified as a way for the government to "collect" foreign currencies,
clients wonder if now goods will cost what rationality suggests should
be their price. Will taximeters need regulation? Could ticket purchases
on international airlines be made in the new currency?

Parallel to the eventual disappearance of the CUC, there exists the
possibility that all the CUP bills circulating today will be
"demonetized" and new issues of 1, 3, 5, 10, 29, and 50 pesos be created
to match the recently-introduced 200, 300, 500, and 1000 pesos bills,
which make counterfeiting more difficult. The latter are already in
circulation and nowhere can anything along the lines of, "Guaranteed by
international standards of free exchange" or "Can be freely exchanged
for foreign currencies at the Central Bank of Cuba" be found, which is
currently the case for each CUC and which could also be seen on the
bills that premiered in the summer of 1961, signed by the person who, at
the time, was the president of the Bank, a man who had the effrontery to
sign the currency of the Republic of Cuba with his nickname: Che.

The secrecy that surrounds the end of the dual currency system attempts
to justify itself with the same arguments as always: above all, we can't
trust in the enemy. However, it won't be able to be delayed for much
longer because even in Cuba, where it has been demonized for decades,
money continues to be something that is essential and part of its value
lies in the trust it is accorded.

Translated by Fernando Fornaris

Source: Without Confidence in the Money / 14ymedio, Reinaldo Escobar |
Translating Cuba -
http://translatingcuba.com/without-confidence-in-the-money-14ymedio-reinaldo-escobar/ Continue reading
[caption id="attachment_38468" align="aligncenter" width="623"] [1] Cuban 20 peso note signed by Che[/caption][2]14ymedio, Reinaldo Escobar, Havana, 3 February 2015 – Any day can be the eve of a celebration or a disaster, as much for those who hurried to exchange their convertible pesos (CUC) to Cuban pesos (CUP – also known as moneda nacional, or “national money”) as for those who are purchasing foreign currencies or who are trusting enough to think that everything is planned and calculated so as not to cause anyone any harm. Although its proximity can almost be smelled, the “final battle” of the end of the dual currency system continues to be a mystery and the present lack of transparency can endanger its presumed strategic objectives.Those who have a good memory or who have dedicated time to digging through our recent history know that the Law 963, passed on 4 August 1961, established the “obligatory exchange of currency” for bills of a new design. That surprising operation took place on Sunday the 6th and Monday the 7th of August 1961. No one was able to leave or enter the country on those two days. Each family unit was only allowed to exchange up to 200 pesos. Of the 1.187 million Cuban pesos considered circulating in the country, only 724.9 million were exchanged. The rest lost its value, vanished.Some naïve people who had their savings inside banks trusted that their money would be exchanged in its entirety. However, the government decided to only hand over one thousand pesos annually, in the form of 100 a month, for ten years, even if people’s accounts contained hundreds or thousands or millions of pesos. Many of those affected by such a drastic measure committed suicide. Such a disastrous exchange process annihilated in one single blow not only the part of the creole bourgeoisie that still remained on this Island, but also the entire middle class. It ripped to shreds people’s life work and savings and also that of past generations. Such a disastrous exchange annihilated in one single blow not only the part of the creole bourgeoisie that still remained on this Island, but also the entire middle class. They say that that new currency came from Czechoslovakia, camouflaged in large wooden boxes since the use of metal containers wasn’t common in those times. The signs on the boxes and the customs declarations indicated that they contained spare parts for Czech-made Zetor tractors. Two days before the exchange, the boxes were opened in secret and the new Cuban peso was distributed to banks throughout the country. Fifty-three years have gone by and anyone could argue that this is not the same country as that from 1961. But the fear lies in that it is still governed by the same people from before, who still invoke the same “stern slogans.”[caption id="attachment_38469" align="aligncenter" width="306"] [3] Front page announcing currency exchange in 1961[/caption]The uncertainty is not only founded on reminiscences from the past; it has solid contemporary motives. No authority has pronounced itself officially on what will be the level of parity of the surviving currency to foreign ones and it isn’t even known whether, in the near future, it will be possible to exchange the CUP for dollars or euros. It is also unknown how much the State will pay for each CUC handed over by citizens once that currency stops circulating.Until now, the only visible advancement toward the end of monetary duality has been the possibility of paying with CUP in stores that previously only sold products for hard currency (the official name of which, TRDs, stands for “foreign exchange collection stores”).In the beginning of 2015, a worker with a 480-peso monthly salary (without access to remittances and without any other chance of getting CUCs) would have to work 23 hours to buy two pounds of powdered milk in one of those markets; 18 hours for a three pounds of chicken drumsticks; another 18 hours for a pound of grams of spaghetti and 19 hours for one quart of cooking oil. Thus, in order to pay this small bill at the current 1-to-25 exchange rate, he will have to work a little over ten 8-hour workdays. A worker with a 480-peso monthly salary will have to work a little over ten 8-hour workdays in order to buy powdered milk, chicken, spaghetti, and cooking oil on the current 1-to-25 exchange rate. In the event that the illusion becomes a reality and the CUC comes to cost 20 Cuban pesos, the worker from our example could get all that and a little more with just over a week of labor, and if the miracle occurs that it come down to 15, he would get everything with fewer than 5 workdays.It is not necessary to be an economist to realize that the country is in no condition to turn that dream into a reality. At least unless delirium reaches the point of fantasizing that, from the secret tunnels where today they keep the old soviet armaments, hundreds of containers of goods surface to furnish the stores that would no longer be called TRDs, because they wouldn’t be collecting any foreign currencies at all, and standing before whose cash registers wouldn’t be today’s nouveaux riches, but the joyous working class, living decently from their salaries.Jumping over our chimeras, other distressing questions remain: will there be a limit to the cash that can be exchanged? Will cash be worth the same as the money in savings accounts? No one has clarified this and the lack of a commitment to these guarantees makes insecurity and distrust mount even higher.In workplaces where perks are received in CUC, beneficiaries are asking themselves if this “stimulus” will keep the 1-to-25 exchange rates in the national currency. In markets where the elevated prices were once justified as a way for the government to “collect” foreign currencies, clients wonder if now goods will cost what rationality suggests should be their price. Will taximeters need regulation? Could ticket purchases on international airlines be made in the new currency? The secrecy that surrounds the end of the monetary duality won’t be able to be delayed for much longer Parallel to the eventual disappearance of the CUC, there exists the possibility that all the CUP bills circulating today will be “demonetized” and new issues of 1, 3, 5, 10, 29, and 50 pesos be created to match the recently-introduced 200, 300, 500, and 1000 pesos bills, which make counterfeiting more difficult. The latter are already in circulation and nowhere can anything along the lines of, “Guaranteed by international standards of free exchange” or “Can be freely exchanged for foreign currencies at the Central Bank of Cuba” be found, which is currently the case for each CUC and which could also be seen on the bills that premiered in the summer of 1961, signed by the person who, at the time, was the president of the Bank, a man who had the effrontery to sign the currency of the Republic of Cuba with his nickname: Che.The secrecy that surrounds the end of the dual currency system attempts to justify itself with the same arguments as always: above all, we can’t trust in the enemy. However, it won’t be able to be delayed for much longer because even in Cuba, where it has been demonized for decades, money continues to be something that is essential and part of its value lies in the trust it is accorded.Translated by Fernando Fornaris[1] http://translatingcuba.com/wp-content/uploads/2015/02/Billete-pesos-firma-Che_CYMIMA20150203_0003_13.png [2] http://www.14ymedio.com/ [3] http://translatingcuba.com/wp-content/uploads/2015/02/Portada-anunciando-cambio-moneda_CYMIMA20150203_0004_16.png Continue reading
Early Farewell to the CUC / 14ymedio, Miriam Celaya
Posted on January 30, 2015

14ymedio, Miriam Celaya, Havana, 29 January 2015 — It was barely 10:00
am Wednesday, January 28th, and the currency exchange (CADECA) at
Belascoaín had no national currency (CUP)*. One of the tellers explained
that he had only several 50 peso bills and that was it until the "cash
truck" arrived. Some customers, leaving because they could not transact
business, stated that this has become the norm, not only at this
currency exchange, but also at the one on Galiano Street, across from
the Plaza del Vapor.

These are virtually the only two currency exchanges operating in the
municipality of Centro Habana after most of them were converted to
ATM's, so both exchange of hard (i.e. foreign) currency to Cuban
convertible currency (CUC) as well as CUC to CUP implies traveling to
some CADECA or to Banco Metropolitano, both located at some distance,
and the likelihood of having to stand on long lines before being able to
complete the desired transaction.

Another difficulty that has become common in both CADECA and ATM
locations is the absence of bills in denominations smaller than 100 or
50 CUP, which also distresses the population, especially the elderly,
who receive their pensions in debit cards and are often unable to
withdraw all of their money, since there are no 5 or 1 peso bills
available. In these cases, they need to wait a whole trimester or
quarter until enough funds accumulate in their accounts to cover the
minimum denominations of 10 or 20 CUP, a ridiculous amount compared to
the high price of any market product, but what is significant is that
the affected individuals depend almost entirely on this income.

Since the start of 2015, Cubans who receive remittances from abroad or
convertible pesos by other means are quick to exchange their money into
the national currency. Those who receive larger amounts – on the order
of 100's of CUC, in general the owners of more thriving private business
— prefer to use the black market to exchange their funds into US
dollars. The common denominator is that nobody wants to hold CUC money,
which, until recently, was in high demand and CADECAS would even often
run out of.

Announcement of a new national currency bill being issued into
circulation in February, in 200, 500 and 1000 peso denominations,
coupled with the ability to access the former "hard currency market"
with either money, has sounded the drum-roll in people's psyche as a
prelude to the much anticipated monetary unification. People fear that
an official changeover will take place that will carry penalizing fees
that will cause serious losses to people's pockets.

The expectation is felt, by osmosis, in the capital's agricultural trade
networks, especially in meat markets that are not "state-owned", where
either one of the two currencies was accepted a few weeks ago. "Mother
of Mercy, give me national currency!" is the butcher's cry at
Combinadito de Sitios in Centro Habana when a customer brings out 20 CUC
to pay for a cut of pork meat whose price these days of non-ration cards
has risen to 45 Cuban pesos per pound. "Country farmers don't want CUC,
my brother, they have a lot of money** and are really afraid of the
monetary unification. They won't sell me meat unless I pay in national
currency".

Something similar is happening with peddlers with street carts, who
still accept payment in "convertible" currency for retail sales, but
their wholesale suppliers are demanding payment in national currency for
their products. A street peddler in my neighborhood states "farmers have
high incomes and almost all producers have accumulated large sums. None
of them wish to lose when the currency is unified".

It is evident that, once more, the lack of information and clarification
on the part of the official media are causing uncertainty and spreads
speculation throughout the population, giving way to obstacles such as
the (unexplained) shortage of cash in the CADECA, increasing the demand
for US dollars in the black market foreign exchanges.

With the imminent introduction of the new denomination bills, clear
evidence of the very high inflation rate in Cuba, nothing is known about
a monetary unification that -according to official notification- will be
gradual and will "not affect" Cuban pockets. For now, it is expected
that, when it takes place, the official exchange rate of 25 pesos in
national currency for each CUC will not continue, a transaction with
which the CADECA and the state commercial networks have operated to
date. Our experience, after decades of deceptive monetary maneuvers, has
motivated the popular wisdom so that, already, before the dreamed about
monetary unification, Cubans are shedding was has been the last few
years' supreme sign of Cuba's status: the CUC.

Translator's notes:

*See here for a longer discussion of the history of Cuba's currencies
and the plan to move to a single currency. Briefly, Cuba has two
currencies: Cuban pesos, also called moneda nacional (national money),
abbreviated CUP; and Cuban convertible pesos, abbreviated CUC. In theory
CUCs are a hard currency, but in fact, it is illegal to take them out of
Cuba and they are not exchangeable in other countries. Cubans receive
their wages and pensions primarily in CUPs, with wages roughly the
equivalent of about $20 US per month, and pensions considerably less.
The CUC is pegged 1-to-1 to the American dollar, but exchange fees make
it more expensive. The CUP trades to the CUC at about 24-to-1.

**It has been a common practice in other tightly controlled countries,
when new currencies are introduced, to limit the total amount of money
people are allowed to exchange and/or to require documentation of the
sources of larger sums. As the old currency becomes instantly worthless
domestically and internationally, people who have been 'hoarding' it can
see almost all their savings disappear. Cubans fear this could happen
with the elimination of the CUC.

Translated by Norma Whiting

Source: Early Farewell to the CUC / 14ymedio, Miriam Celaya |
Translating Cuba -
http://translatingcuba.com/early-farewell-to-the-cuc-14ymedio-miriam-celaya/ Continue reading
[caption id="attachment_38365" align="aligncenter" width="623"] [1] Several people stand on line at a currency exchange (CADECA). (EFE)[/caption] 14ymedio, Miriam Celaya, Havana, 29 January 2015 -- It was barely 10:00 am Wednesday, January 28th, and the currency exchange (CADECA) at Belascoaín had no national currency (CUP)*. One of the tellers explained that he had only several 50 peso bills and that was it until the “cash truck” arrived.  Some customers, leaving because they could not transact business, stated that this has become the norm, not only at this currency exchange, but also at the one on Galiano Street, across from the Plaza del Vapor. These are virtually the only two currency exchanges operating in the municipality of Centro Habana after most of them were converted to ATM’s, so both exchange of hard (i.e. foreign) currency to Cuban convertible currency (CUC) as well as CUC to CUP implies traveling to some CADECA or to Banco Metropolitano, both located at some distance, and the likelihood of having to stand on long lines before being able to complete the desired transaction. Another difficulty that has become common in both CADECA and ATM locations is the absence of bills in denominations smaller than 100 or 50 CUP, which also distresses the population, especially the elderly, who receive their pensions in debit cards and are often unable to withdraw all of their money, since there are no 5 or 1 peso bills available. In these cases, they need to wait a whole trimester or quarter until enough funds accumulate in their accounts to cover the minimum denominations of 10 or 20 CUP, a ridiculous amount compared to the high price of any market product, but what is significant is that the affected individuals depend almost entirely on this income. Since the start of 2015, Cubans who receive remittances from abroad or convertible pesos by other means are quick to exchange their money into the national currency. Those who receive larger amounts – on the order of 100’s of CUC, in general the owners of more thriving private business -- prefer to use the black market to exchange their funds into US dollars. The common denominator is that nobody wants to hold CUC money, which, until recently, was in high demand and CADECAS would even often run out of. Announcement of a new national currency bill being issued into circulation in February, in 200, 500 and 1000 peso denominations, coupled with the ability to access the former “hard currency market” with either money, has sounded the drum-roll in people’s psyche as a prelude to the much anticipated monetary unification. People fear that an official changeover will take place that will carry penalizing fees that will cause serious losses to people’s pockets. Fear is running throughout the population that an official changeover will take place suddenly, with extremely high fees that would produce serious loses to their pockets The expectation is felt, by osmosis, in the capital’s agricultural trade networks, especially in meat markets that are not “state-owned”, where either one of the two currencies was accepted a few weeks ago. “Mother of Mercy, give me national currency!” is the butcher’s cry at Combinadito de Sitios in Centro Habana when a customer brings out 20 CUC to pay for a cut of pork meat whose price these days of non-ration cards has risen to 45 Cuban pesos per pound. “Country farmers don’t want CUC, my brother, they have a lot of money** and are really afraid of the monetary unification. They won’t sell me meat unless I pay in national currency”. Something similar is happening with peddlers with street carts, who still accept payment in “convertible” currency for retail sales, but their wholesale suppliers are demanding payment in national currency for their products. A street peddler in my neighborhood states “farmers have high incomes and almost all producers have accumulated large sums. None of them wish to lose when the currency is unified”. The lack of information and clarification from the official media creates uncertainty and speculation in the population. It is evident that, once more, the lack of information and clarification on the part of the official media are causing uncertainty and spreads speculation throughout the population, giving way to obstacles such as the (unexplained) shortage of cash in the CADECA, increasing the demand for US dollars in the black market foreign exchanges. With the imminent introduction of the new denomination bills, clear evidence of the very high inflation rate in Cuba, nothing is known about a monetary unification that -according to official notification- will be gradual and will “not affect” Cuban pockets. For now, it is expected that, when it takes place, the official exchange rate of 25 pesos in national currency for each CUC will not continue, a transaction with which the CADECA and the state commercial networks have operated to date. Our experience, after decades of deceptive monetary maneuvers, has motivated the popular wisdom so that, already, before the dreamed about monetary unification, Cubans are shedding was has been the last few years’ supreme sign of Cuba’s status: the CUC. Translator's notes:*See here [2]for a longer discussion of the history of Cuba's currencies and the plan to move to a single currency. Briefly, Cuba has two currencies: Cuban pesos, also called moneda nacional (national money), abbreviated CUP; and Cuban convertible pesos, abbreviated CUC. In theory CUCs are a hard currency, but in fact, it is illegal to take them out of Cuba and they are not exchangeable in other countries. Cubans receive their wages and pensions primarily in CUPs, with wages roughly the equivalent of about $20 US per month, and pensions considerably less. The CUC is pegged 1-to-1 to the American dollar, but exchange fees make it more expensive. The CUP trades to the CUC at about 24-to-1. **It has been a common practice in other tightly controlled countries, when new currencies are introduced, to limit the total amount of money people are allowed to exchange and/or to require documentation of the sources of larger sums. As the old currency becomes instantly worthless domestically and internationally, people who have been 'hoarding' it can see almost all their savings disappear. Cubans fear this could happen with the elimination of the CUC.Translated by Norma Whiting[1] http://translatingcuba.com/wp-content/uploads/2015/01/Varias-personas-cambio-CADECA-EFE_CYMIMA20150129_0001_16.jpg [2] http://www.worldfinance.com/banking/cuba-to-ditch-complicated-dual-currency-system Continue reading
Cuba to print higher-denomination pesos
By ANDREA RODRIGUEZ The Associated Press
First Published Jan 15 2015 06:06PM

Havana • Cuba will print bills of 200, 500 and 1,000 pesos that will
start to circulate in February, a step forward in the government's plan
to unify its dual-currency system.

A Cuban Central Bank resolution published Thursday said the new
banknotes will extend the range of the current bills, which only reach
100 pesos.

Most Cubans earn and buy goods in local pesos worth about 4 U.S. cents
apiece. Tourism, one of the island's main sources of foreign exchange,
operates on the convertible peso, a special currency worth roughly one
U.S. dollar.

The double currency allows Cuba to theoretically split the country
between a realm of highly subsidized prices in Cuban pesos and a
convertible-peso economy where prices more closely resemble those of
U.S. or European cities. But the system has led to economic distortions
and created a new class of privileged Cubans with access to convertible
pesos.

Cuba's government announced in 2013 that it would eliminate the double
currency but did not set out a timetable for the switch.

Central Bank Vice President Francisco Mayorbe told state newspaper
Granma that in recent months a lot of stores that sell in convertible
pesos have started accepting local pesos, with the price set after
establishing the exchange rate.

This means that customers and businesses must increasingly handle larger
quantities of cash, a problem accentuated by the fact that the country's
largest banknote, the 100-peso bill, is worth about 4 U.S. dollars.

Barbara Soto Sanchez, an official with state company Cimex, said most
sales are carried out with 20- or 50-peso bills, which makes buying
expensive products like electrical appliances or furniture difficult.

"To buy them, the customer has to bring in a large quantity of cash
under conditions that are not always optimal," Soto Sanchez told Granma.

———

Andrea Rodriguez on Twitter: https://twitter.com/ARodriguezAP

Source: Cuba to print higher-denomination pesos | The Salt Lake Tribune
-
http://www.sltrib.com/home/2064563-155/cuba-to-print-higher-denomination-pesos Continue reading
Jackson Diehl: The U.S. waits 65 years to recognize Cuba, then picks the
wrong moment
Jackson Diehl, Special to National Post | January 5, 2015 12:23 PM ET
More from Special to National Post

An enduring characteristic of Barack Obama's presidency has been his
determination to implement the ideological agenda with which he arrived
in office without regard for conditions in the real world. He imposed
timetables for "ending the wars" in Afghanistan and Iraq unlinked to
military progress. He insisted on pursuing Israeli-Palestinian peace
talks, even though the leaders of both sides were manifestly unwilling.
He began his second term by seeking a new nuclear arms deal with
Vladimir Putin, despite abundant evidence that Putin was preparing for
confrontation with the West.

Now, six years into his presidency, Obama has launched, as his first
significant initiative in Latin America, detente with Cuba. It's a torch
that many liberals have carried for decades. Once again, however, the
president has acted with willful disregard for current events.

Cuba Derangement Syndrome remains potent scourge in Republican ranks

Barack Obama has made a geopolitical irrelevancy suddenly relevant to
American presidential politics. For decades, Cuba has been instructive
as a museum of two stark failures: socialism and the U.S. embargo. Now,
Cuba has become useful as a clarifier of different Republican flavours
of foreign-policy thinking.

In particular, two salient facts were ignored. The first is that the
regime of Raúl Castro was desperate for an economic opening to the
United States — meaning that concessions offered gratis by Obama could
have been used to leverage meaningful political concessions by the
regime. A simple one could have been an end to the arrests and beatings
of peaceful dissidents, such as those that occurred last week.

Second, Obama ignored the slowly mushrooming crisis that triggered
Castro's distress and that ought to be the focus of U.S. energies in
Latin America. That is the slow but potentially catastrophic collapse of
Venezuela, a major U.S. oil supplier with three times Cuba's population
that, as 2015 begins, is well on its way to becoming a failed state.

Venezuela has been a virtual Cuban colony in recent years, which is one
big reason for the fix it is in. After sheltering caudillo Hugo Chávez
during his slow demise from cancer, Havana helped to install as his
successor Nicolás Maduro, a former bus driver of astonishingly small
talents. Since Chávez's death 22 months ago, Maduro has faithfully
continued the 100,000-barrel-a-day oil subsidy that keeps Cuba's
moribund economy from crumbling.

Meanwhile, Maduro has overseen the degeneration of his country's
economic, political and social situation from abysmal to truly
disastrous. Economic production declined by 5 percent in the first half
of this year, inflation rose past 60 percent and an estimated one-third
of consumer goods were in shortage — and that was before the 50 percent
drop in the price of Venezuela's oil, which provides 95 percent of the
hard currency for a country that imports most of its food and medicine.

By many measures, Venezuela is already a failed state. According to the
Venezuelan Violence Observatory, a record 25,000 people were murdered in
the country in 2014, the second-worse homicide rate in the world after
Honduras. The U.S. government estimates that half of the cocaine
produced in South America now moves through Venezuela — 300 tons a year
— with the help of top leaders of the military and police. There have
been deadly clashes between official security forces and the armed
civilian "collectives" organized by the regime. And Wall Street has
begun anticipating a Venezuelan default.

As oil revenue has plummeted in the past few months, Maduro has refused
to address even the most extreme economic distortions — such as a
black-market exchange rate for the dollar 350 percent higher than the
highest of three official ones, or gasoline that sells for pennies a
gallon. Instead he has delivered endless speeches denouncing the
"economic war" he claims is being waged against Venezuela by the United
States, and he has imprisoned top opposition leaders such as Leopoldo
López, a U.S.-educated moderate leftist. "My country," López wrote in a
letter published by the Wall Street Journal on Dec. 25, "is on the verge
of social and economic collapse."

Oddly, the only discernible policy the Obama administration has toward
this unfolding implosion is the one it just repudiated for Cuba:
sanctions. The day after announcing the normalization with Havana, Obama
signed legislation mandating visa bans and asset freezes for senior
Venezuelan officials linked to violations of human rights, including the
killing of dozens of street demonstrators last year.

Venezuela's opposition supports those sanctions. But its leaders have
also been saying that the country desperately needs outside diplomatic
intervention. A halfhearted effort by the UNASUR regional group petered
out months ago. Now the region's big governments, like the White House,
focus on the political rehabilitation of Cuba while ignoring the
situation in Caracas.

That's particularly wrongheaded because there is a clear role for
foreign mediators to play in brokering a deal between the government and
moderate opposition that could allow for a political truce, the release
of prisoners and emergency measures to stabilize the economy. "To remain
silent," wrote López, "is to be complicit in a disaster that doesn't
just impact Venezuela but could have implications across the
hemisphere." Too bad his country wasn't on Obama's preconceived agenda.

The Washington Post

Jackson Diehl is deputy editorial page editor for The Washington Post.

Source: Jackson Diehl: The U.S. waits 65 years to recognize Cuba, then
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Is the Cuban government considering declaring as “heritage assets” the classic cars that roam the streets? Cubanet, Camilo Ernesto Olivera Peidro, Havana, 2 January 2015 — Apropos of the imminent reestablishment of relations between Cuba and the US, General Motors … Continue reading Continue reading
It is 7:30 PM in a commercial shopping district in San Diego, Califormia. Four Venezuelan tourists approach Spanish-speaking customers browsing among tablets, smart phones, flat-screen TVs and laptops with a business proposition. “If you are going to buy something with … Continue reading Continue reading
Cuba inches toward transparency, seeking investment and credit
By Marc Frank

HAVANA, Dec 24 (Reuters) - Cuba released more information on its fragile
external finances this week than it has in over a decade, as it seeks
foreign investment and credit following its sudden improvement in
relations with the United States.

The government revealed a healthy current account surplus of $1 billion
for 2014, supported by remittances and the re-export of oil that it
receives on favorable terms from Venezuela, its closest ally.

An estimate of foreign currency reserves, normally a state secret, has
also surfaced. Western diplomats told Reuters they had seen a figure of
$10 billion on what appeared to be an official economic report.

The revelations followed U.S. President Barack Obama's announcement last
week that Washington would restore diplomatic ties with Cuba and lift
some economic sanctions in a dramatic about-face after more than five
decades of confrontation.

Hungry for fresh credit but in no position to enter the bond market,
Cuba has over the past four years restructured billions of dollars worth
of debt with China, Japanese commercial creditors, Mexico and Russia,
obtaining substantial reductions in what it owed in exchange for payment
plans it can meet.

It has also significantly increased tax incentives for foreign
investment, although companies say tax cuts are not enough and complain
about a lack of information needed to make investment decisions.

Debt negotiations with the Paris Club of creditor nations may begin next
year after 18 months of informal contacts, according to European
diplomats, but they say Cuba will have to first open its books.

It appeared to be making a start this week.

FRESH FIGURES

Diplomats said the reserves figure of $10 billion seemed feasible as
Cuba has increased its reserves for fear of economic and political
turmoil in Venezuela. It also plans to unify the dual monetary system
and devalue the one-to-one exchange rate with the dollar.

Cuba last reported its "active" foreign debt, accumulated after it
declared a default in the late 1980s, as $13.9 billion in 2011. It no
longer reports its "passive" debt from before the default, which
economists estimate at $8 billion.

Pavel Vidal, a former Cuban central bank official who now lives in
Colombia but follows Cuba's finances closely, said he estimates the
foreign debt is "somewhere between $25 billion and $30 billion" and that
a $10 billion reserves figure is plausible.

The current account showed a surplus of $1 billion this year but will
drop to $5 million in 2015 as Cuba increases imports by 13 percent to
stimulate growth, according to Economy Minister Marino Murillo, a
significant admission for a country that usually waits three years to
report such information.

He revealed the information in a closed-doors session of the National
Assembly last week and it was broadcast by state media on Monday.

Since President Raul Castro took over for older brother Fidel in 2008,
Cuba has achieved significant trade and current account surpluses after
years of deficits. Exports have risen more than 50 percent while imports
have grown less than 8 percent as the government tries to regain
international credibility by improving its finances and meeting debt
payments.

Remittances totaled $1.7 billion this year and the re-export of
Venezuelan oil brought in $765 million, Murillo said in offering a
fairly detailed line item review of the current account for the first
time in more than a decade.

He also said the payment of dividends to foreign joint venture partners
would increase from $120 million this year to $447 million in 2015.

Most surprisingly, Murillo, Castro's point man charged with dismantling
the old Soviet-style economy and building one similar to Asian
communism, said Cuba obtained $5.7 billion in credit to cover the same
amount in debt payments in 2015.

"To open the international financial gates Cuba will have to be much
more transparent in releasing economic data, especially on its balance
of payments," said Richard Feinberg, the author of several studies on
Cuba's need to join the international financial community. "This new
data release is a step in the right direction." (Reporting by Marc
Frank; Additional reporting by Daniel Bases in New York; Editing by
Daniel Trotta and Kieran Murray)

Source: Cuba inches toward transparency, seeking investment and credit -
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Cuban MDs Protest over Deteriorated State-Assigned Homes
December 4, 2014
By Fabian Flores (Café Fuerte)

HAVANA TIMES — For the Cuban medical doctors who traveled to Venezuela
in the hopes of obtaining a home upon their return from their
internationalist mission, dreams have turned into nightmares –
nightmares in Las Tunas, to be more geographically precise.

A group of 36 medical doctors from the municipality of Puerto Padre, Las
Tunas, have approached Cuba's official press to publicly condemn the
disastrous condition of the apartments they were given upon their return
from Venezuela, a situation that has only worsened over time without any
response from local government authorities

The reaction of these physicians from Las Tunas was published by the
newspaper Trabajadores under the title of Institucionalizar el caos?
("Are We Institutionalizing Chaos?"), after the doctors received a
letter from the Provincial Housing Office in Las Tunas demanding
mortgage payments.

Unaddressed Complaints

"We have been complaining about the poor constructive quality of most
apartments through the national and local media for more than five
years," Dr. Maricela Grass Santiesteban states in the letter sent to the
newspaper on behalf of her colleagues.

According to Dr. Grass' complaints, the tenants have to deal with leaky
ceilings, unfinished water tanks, deteriorated walls, inadequate water
facilities and a lack of urban infrastructure in the area.

The tenants had already written Trabajadores on October 3, 2011,
explaining the structural problems of the apartments they'd been given.

In his article, journalist Jorge Perez Cruz acknowledges that these
medical doctors are justified in their anger and in demanding answers to
their questions.

"Where are the resources allocated to finishing our apartments? Why have
they been letting the assigned budget expire every year? Why are they
making us pay for our homes in a single year, in two installments, on
threat that, if we fail to do so, we will be forced to lease the
apartments, when all others have more than 15 years to do so?" the
letter asks.

Government Regulations

The problem surfaced after the Ministry of Public Health, the Ministry
for Construction and Cuba's Central Bank issued a series of resolutions
aimed at granting title of these homes to health professionals who had
worked in Venezuela, and guaranteeing the payment of these homes in cash
or through bank transfers.

The resolutions were published on November 12 last year in a special
issue of Cuba's Official Gazette.

According to the banking provisions, the owners may pay for the homes
assigned to them through deductions from wages or other incomes, on the
basis of the exchange rate in effect in the country. The document
specifies that "should tenants fail to comply with the agreed payments,
the bank shall notify the pertinent Provincial Public Health Office so
that appropriate measures may be applied."

The measure has given rise to concerns not only in Las Tunas but among
all medical doctors who have been assigned homes because of their work
abroad. These are complaining about the high price of the properties,
which are poor in terms of their finishing, expansion or remodeling.

Shoddy Construction Work and Crime

The government program conceived of these homes as an incentive for
medical doctors sent to Venezuela, who were offered adjusted prices that
were to be covered using the money earned abroad.

More and more criticisms have been voiced, however, in response to the
poor quality of the construction work.

"Needless to say, enforcing that decision is a crude way of accepting
poor practices, shoddy work and who knows how many arbitrary practices
that border on the criminal. Five years has been more than enough time,
not only to respond to our complaints, but to find solutions to our
problems as well," the article in Trabajadores concluded.

The government, however, is intent on collecting unpaid installments
among the population.

Last week, the Council of Ministers stated it would adopt measures to
strengthen controls aimed at curbing misdemeanors, including false
income statements for household sales and rental services, and that it
would apply a more restrictive policy on the transfer of ownership over
housing assigned by the State or basic dwellings built using State
subsidies.

Source: Cuban MDs Protest over Deteriorated State-Assigned Homes -
Havana Times.org - http://www.havanatimes.org/?p=107734 Continue reading
Defections by Cuban Doctors in Venezuela Double / 14ymedio
Posted on November 11, 2014

14ymedio, Havana, 10 November 2014 — Some 700 Cuban health professionals
defected from Venezuela between September 2013 and September 2014,
according to data published Sunday in Caracas by the daily El Universal.
The majority went to the United States and reported the deterioration of
their work conditions.

This figure doubles the number from the same period a year earlier, when
some 300 professionals left their missions, according to information
from Solidarity Without Borders (SSF), an organization with headquarters
in Miami that helps Cuban health professionals looking for a better future.

"The worsening of conditions in Venezuela is causing an increase in
defections. The lack of safety, low pay, worker exploitation and control
over private life continue to be the big reasons," said Doctor Julio
Cesar Alfonso, president of the organization, to El Universal.

Alfonso explains that the most significant increase was registered after
the death of President Hugo Chavez. Among other reasons that impel
doctors to escape, according to the organization's president, are the
devaluation of the bolivar, an average salary of 100 dollars at the
official exchange rate and few prospects for professional development.

The phenomenon is not limited to Venezuela and, according to Solidarity
Without Borders, some 1,100 Cuban professionals abandoned their missions
abroad between September 2013 and 2014.

Translated by MLK

Source: Defections by Cuban Doctors in Venezuela Double / 14ymedio |
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14ymedio, Havana, 10 November 2014 — Some 700 Cuban health professionals defected from Venezuela between September 2013 and September 2014, according to data published Sunday in Caracas by the daily El Universal. The majority went to the United States and … Continue reading Continue reading
Rare Independent Group Aims to Open Debate in Cuba
CARDENAS, Cuba — Oct 16, 2014, 2:31 PM ET
By MICHAEL WEISSENSTEIN Associated Press

The former editors of one of Cuba's few non-government controlled media
outlets have quietly restarted efforts to spur debate about the nation's
future, launching a series of public forums and plans for a new journal
addressing the island's most urgent problems.

The project, known as "Cuba Posible," joins a handful of others in the
small space between the uncritical state-run media and fiercely partisan
dissident websites that have little reach inside Cuba.

Lawyer Roberto Veiga and journalist Lenier Gonzalez gained renown among
Cuban intellectuals by transforming the Catholic church magazine Espacio
Laical into a rare and influential forum for sociopolitical debate
before the two men left last year amid an apparent church backlash over
the publication's aggressive coverage of current affairs.

The two men and their small circle of close collaborators say they are
confident the project can provide a space for dialogue between
government supporters and critics without running afoul of the island's
communist leaders.

"We hope that we'll be heard and paid attention to in the world of
politics," said sociologist and project backer Aurelio Alonso. "We hope
that what's said won't remain in a void, but will affect institutions
and political players."

Funded by Norway's University of Oslo, Cuba Posible is based out of the
Christian Center for Reflexion and Dialogue, an ecumenical church group
focused on community projects that occasionally publishes newsletters
and magazines from Cardenas, a sleepy mid-sized city about 95 miles (155
kilometers) east of Havana. Basing the new group there means it can use
the center's existing government permits rather than seek permission for
a new independent publication.

"There have always been people inside the government who don't like what
we do and people who care about what we do," Veiga told The Associated
Press this week. "There are a variety of opinions but there's no policy
aimed at disrupting or battling us."

The first public forum attracted dozens of academics and intellectuals
and gave a hint of the group's approach. Its central theme, "Cuba:
Sovereignty and the Future," was uncontroversial enough to avoid the
risk of official ire. Participants avoided direct criticism of President
Raul Castro or the island's single-party system in place since the 1959
revolution. But some speakers, particularly those who rose from the
audience to question speakers on panels, were unsparing in their
evaluations of Cuba's poor performance in a variety of sectors ranging
from expanding the economy to updating educational curricula.

Gonzalez said the project's founders were fierce defenders of Cuban
sovereignty and wanted to improve the current system rather than see it
overturned in a return to its pre-revolutionary past.

"We don't think that's a possibility for Cuba and we don't want that,"
he said. "We're working to pose important questions, to maintain the
ideal that a better country is possible, and it's possible to achieve
that among Cubans who think differently but have common values."

Prominent Cuban exile businessman Carlos Saladrigas, who participated in
forums organized by Espacio Laical, said he believed that Cuba Posible
could gain more influence than the two men's former publication.

"For the moment their task is putting on the table ideas that require
critical debate. Cuba has a lot of things to rethink," Saladrigas said.
"If they succeed in this process I think they're going to greatly
contribute to this dialogue between Cubans."

Gonzalez, 33, and Veiga, 49, say they plan to publish their first
journal by year's end.

Speaking after the forum, Veiga cited the country's slow progress toward
the abolition of a special currency for tourists as an example of the
type of problem that Cuba Posible is designed to address. The double
currency allows Cuba to theoretically split the country between a realm
of highly subsidized prices in Cuban pesos and a tourist economy where
prices more closely resemble those of U.S. or European cities. But the
system has contributed to the rise of a new class of privileged Cubans
with access to convertible pesos. And it has led to economic distortions
like a special exchange rate for state enterprises that effectively
subsidizes them with cheap convertible pesos.

Cuba can't get rid of the convertible peso and related subsidies without
increasing productivity, can't increase productivity without foreign
investment and can't attract sufficient foreign investment without
reforming its monetary system, Veiga observed.

"We're trapped in a vicious cycle that we have to get out of," he said.

Of his and Gonzalez's efforts to spur dialogue in a nation not
accustomed to it, he added: "We've strived from the beginning to have
something that appeared impossible, and today is more possible, which is
that people who think differently can share the same space and even work
together."

———

Associated Press writer Andrea Rodriguez contributed to this report.

———

Michael Weissenstein on Twitter: https://twitter.com/mweissenstein

Source: Rare Independent Group Aims to Open Debate in Cuba - ABC News -
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Cuba's Mad Array of Exchange Rates
October 11, 2014
Vicente Morín Aguado

HAVANA TIMES — True monetary unification will be difficult to achieve in
Cuba. The steps taken so far, coupled with what we know about how the
Party-State operates, suggest we will continue to see the opportunistic
use of multiple exchange rates, a possibility created by the monopoly
that the State maintains over all economic sectors (one of the so-called
"advantages" of socialism).

The government has declared that the two-currency system will come to a
definitive end in 2016. With evident discretion, the press has not
offered the slightest foretaste of this controversial process,
considered the toughest step in the implementation schedule of the
Guidelines of the Party Congress, roadmap of the reform process now and
underway, euphemistically referred to as the "updating of Cuba's
economic model."

Let us go straight to the heart of the matter, skipping over some
details (as the Cuban economy is like Frankenstein's monster, witch
patches have been applied in the course of years, following nights of
intense and uncontrollable fevers).

At one point, the novelty of applying two sets of prices to different
products was approved. Articles purchased at hard-currency stores are
sold in CUC, using the 1 CUC (Cuban Convertible Peso, or "dollar", in
street parlance) to 25 CUP (Cuban peso) exchange rate. Now, a television
set valued at 300 CUC can be purchased at 7,500 CUP. It's clear nothing
has changed for the majority of Cuba's tormented buyers.

In addition, dealings where a 1 CUC – 10 CUP exchange rate applies are
authorized between State companies and between State companies and
self-employed parties or cooperatives. This exchange rate is used to
revalue State funds within the monetary unification process underway.

Also and not less significantly, at the Mariel Special Development Zone,
Cuban monopolistic employers will pay workers on the basis of a 1 CUC –
10 CUP exchange rate and will consider the US dollar to be on a par with
the CUC. This, in fact, introduces yet another exchange rate to Cuba's
national economy, that of 1 USD – 1 CUC.

What's more, the population legally acquires 1 CUC at 25 CUP and sells
it at 24 CUP, and informally accepts rates of 1 CUC – 23 CUP and even 1
CUC – 20 CUP, when transactions are carried out at State stores which
had been authorized to receive only CUP for their products or services
till now.

Both legally and de facto, Cuba has a system of multiple exchange rates
which are likely to persist in the foreseeable future, given the
customary trial-and-error (if not downright improvisational) methods
inherent to the governing elite that is today leading the reform
process, "slowly but surely", intent of finally delivering the earthly
paradise of communism promised so many years ago.

Following the decision to eliminate the existing two-currency system (at
least in its most visible expression), playing around with exchange
rates and applying specific rates in some cases, has till now been
presented as a temporary solution, but it could well become a recurrent
method of the bureaucracy that holds the fate of the country in its hands.

Two economists who have for years been linked to the spheres where
Cuba's national economic decisions are made, Pavel Vidal Alejandro and
Omar Everleny Perez, leave us with the following warning: "The era of
multiple exchange rates as an effective option in the design of exchange
policy designs, has been left behind internationally owing to their
proven inefficiency and their high costs."

The quote is taken from the first, 2014 issue of Cuba's Espacio Laical
("Secular Space") magazine. The authors describe Argentina's and
Venezuela's negative experiences with multiple exchange rates, and wish
that, in Cuba, such decisions "are only a transitory mechanism, in
anticipation of a definitive convergence with a single exchange rate for
everyone."

The backdrop to this is acceptance of the market, whose unavoidable
presence is the great dilemma communists face when they design domestic
economies. A single currency is needed for the optimal flow of monetary
and market relations, and it is the one common denominator of all
economic activity.

To date, we continue to regret that Cuba's revolutionary leadership has
not undertaken a profound and sincere self-criticism with respect to its
economic experiments, all of which bear the eloquent stamp of negative
results.

Once again, the specter of appearances comes along to becloud reality.
We may finally end up with a single currency in our pockets and several
to gage the real workings of the economy.

We may only get half of the way there, swimming euphorically towards a
beach whose sands await the steps of homo erectus, and perhaps even homo
sapiens.
—–
vicentemorin@yahoo.com

Source: Cuba's Mad Array of Exchange Rates - Havana Times.org -
http://www.havanatimes.org/?p=106670 Continue reading
What Purpose Did the Dual Currency System Serve? / 14ymedio, Miriam Celaya
Posted on September 3, 2014

"This commercial site accepts payment in national currency"

14ymedio, Havana, Miriam Celaya, 27 August 2014–The information that the
Central Bank of Cuba (BCC) published on August 19th in the paper edition
of the newspaper Granma about "the next issuance of high denomination
bank notes (100, 50 and 20 pesos, CUP) with new security measures"
brings back to the forefront the issue of the dual currency and its
unification, as announced by the same official press, a change which
will take place in the near future.

Security measures that will begin to appear in the above currency issues
starting in 2014 consist of the placement of a watermark with each
patriot's image corresponding to each denomination placed in the upper
left corner of the front face of such bills. In addition, another
watermark will repeat the bill's denomination on the upper left portion
of said image. Meanwhile, lesser denomination bills will continue to
carry the watermark with the image of Celia Sánchez, to the right of
which will be added the corresponding denomination of the bill.

Some believe that such measures respond primarily to the large amount of
counterfeit currency that, according to some, is currently circulating,
which should gradually start to disappear as the new notes start to
replace the existing ones in circulation. However, most of the random 50
people surveyed in Havana felt that this is a preliminary step to the
announced monetary unification, which may be imminent.

This second view seems to be reinforced by the fact that just two weeks
before the information of the BCC, Granma had published an article that
addressed the issue of the dual currency and the need to eliminate the
"distortion of the economy", especially in the government sector.

The media's insistence on the issue of the monetary system in such a
short period of time must not be by chance, and it's in line with the
"baseball-informative" style to hit the ball before it's pitched. This
allows for people to assimilate more resignedly (more like passively)
the effects that such a step might have on the common pocket. In that
experiment is included the recent permission for payment in national
currency at the stores that up until recently only accepted CUC (Cuban
convertible pesos). So far, no information has leaked as to exactly when
the unification process will begin which has already been announced; it
will begin at the government level and will gradually extend to all sectors.

Solving a problem and creating another

Dual currency was created only in the interest of the government to
collect all circulating currency in the country following the
decriminalization of the American dollar.

Economist Joaquín Infante, of the Union of Economists of Cuba, said in a
statement to Agence France Presse that eliminating the dual currency "is
one of the most important steps" of economic reforms being implemented
by President Raul Castro. He also felt that "monetary and exchange rate
unification is an urgent, strategic decision" that "should have been
made long ago."

It probably would have been a tall order for him to express a more
obvious truth: The dual currency was only created in the interest of the
Government to collect all the circulating currency in the country after
the decriminalization of the dollar, announced by Fidel Castro in his
speech of July 26 1993, and then approved in the Official Gazette of
August 13th of that year, dates that show that the then Cuban President
took the "enemy" currency issue very personally.

So, the convertible peso (CUC) began circulating in 1994. Comparable to
the US dollar, CUCs and dollars began to circulate simultaneously until
2004, when the dollar was finally withdrawn from circulation, though the
penalty for its possession was not reinstated. Thus, for at least for 10
years there were not only two, but three currencies in circulation: The
two Cuban currencies: the CUC, nicknamed "chavito" or "carnavalito"
(little carnival because of its coloring); the CUP or non-convertible
peso; and the US dollar. This had not happened since the national
currency was created in 1914 during the presidency of Mario Garcia
Menocal, when the Cuban peso made its debut as a legitimate currency in
the country, with legal value and as the unlimited legal tender for
payment of any obligation within Cuba.

More questions than answers

Cuban-style government, and, as a consequence, its monopoly on
information too, are based on an unrestrictive conspiring principle:
everything is a secret, supposedly "for security reasons, because we are
besieged by a powerful enemy", but on the issue of the much heralded and
long-delayed monetary unification, reality points toward more plausible
causes, such as a lack of liquidity and the economic and financial
crisis that the system–and with it, the country–is going through where
monetary duality creates a distortion that hinders the government's
interests in attracting foreign investors.

On the issue of the much heralded and long-delayed monetary unification,
reality points to causes such as lack of liquidity and the economic and
financial crisis of the system

Indeed, dual currency is not a "Fidel creation". In China there was also
a dual foreign exchange where one of the currencies was hard currency;
the other one was not "convertible so it had a much lesser value.
However, the reforms that allowed a rising of the economy in that
country allowed the unification into one strong currency with
internationally recognized value. It's not the case of Cuba, where after
a process of "updating the model" and countless incomplete reforms, the
economy shows no signs of recovery and the currency lacks absolutely any
value in the international market.

On the other hand, the loss of wages in Cuba by the huge difference in
value of two circulating currencies has created uncertainty about the
ability for public consumption once unification occurs. The increasing
trend of commodity prices in the domestic market, coupled with the many
restrictions that hinder the economic empowerment of citizens and the
unfair wage regulations that will be applied to workers in foreign
companies –onerously taxing hard currency in the change- is not
conducive to optimism.

At any rate, the BCC has not yet informed the public about a timetable
for unification, much less, the exchange value of the final currency…
the humble CUP.

As my colleague Reinaldo Escobar said a while back in an article posted
on his blog under the title of ¿Cambio Numismatico? (Currency Change?),
"The question we ask ourselves is whether there will be a change in the
value of our salaries. How many hours will we have to work–once the
currency is unified–to buy 500 grams of spaghetti, a litter of oil or a
beer?"

The good news is that from the currency unification on, Cuban workers
will have a more clear awareness of what "real salary" is. Perhaps by
then the official media will stop informing us about the statistics
about poverty levels in other countries, including those "poorer than ours".

And, at the end of the day, can someone explain what the purpose of the
dual currency was for us?

Translated by Norma Whiting

Source: What Purpose Did the Dual Currency System Serve? / 14ymedio,
Miriam Celaya | Translating Cuba -
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14ymedio, Havana, Miriam Celaya, 27 August 2014–The information that the Central Bank of Cuba (BCC) published on August 19th in the paper edition of the newspaper Granma about “the next issuance of high denomination bank notes (100, 50 and 20 … Continue reading Continue reading
State biotech company Labiofam is beginning construction of the first facility for bio-plaguicides and bio-fertilizers in Villa Clara Continue reading
"The decision to unify Cuba's dual currency and exchange rate cannot be postponed," says Joaquin Infante, advisor to the head of the Cuban Association of Economists. The interview with Infante touches Continue reading
The annual meeting of the Association for the Study of the Cuban Economy (ASCE) in Miami features a record number of presenters from Cuba Continue reading
Conservative Mentalities and Cuba’s Exchange Rates
July 15, 2014
Dmitri Prieto

HAVANA TIMES — Many years ago, the US dollar – then on a par and freely exchangeable with the Cuban Convertible Peso (CUC) – was valued at 20 Cuban pesos (CUP).

At the time, Cuban quarters (25 CUC cents) were, by simple arithmetic, equivalent to 5 Cuban pesos (CUP) each. By the same logic, nickels (or 5 CUC cents) were each valued at 1 Cuban peso, and dimes at two. Fifty CUC cents were exactly 10 CUP.

With time, the value of the CUC went up (or that of the CUP went down). Today, some private cab drivers – those in the town of Guanabo, for instance – maintain the original exchange rate of 1 CUC to 25 CUP, presumably because this makes it easier for them to deal out change to passengers. In these cabs, when you pay with a 50 CUP bill, you almost always get your 25 CUP change in CUC (in bill or coin form).

Cuban exchange locales (known as “CADECAS”), however, purchase CUCs at 24 Cuban pesos, and many privately-operated establishments exchange it at 23 CUP (sometimes posting up a sign announcing this).

Yesterday, I went to the market to buy an avocado that cost 8 CUP. I didn’t have Cuban pesos on me and I paid the vendor with a 3 CUC bill. The vendor didn’t have Cuban Convertible Pesos and gave me back 61 CUP (using the 1 CUC – 23 CUP exchange rate).

Had he valued the CUC at 25 CUP, he would have given me 67 CUP in change.

Following a rather twisted arithmetic logic, the 6-CUP difference means that I bought that avocado at 14 CUP. If the average price of a mid-sized to large avocado (I am unsure as to the exactness of this figure, but let us assume it is accurate) is 10 CUP, thanks to this less favorable CUC exchange rate, a cheap avocado (8 CUP) was suddenly made expensive (14 CUP).

Things become even more complicated when we start to deal with fractional figures.

For some strange reason, even though the CUC quarter is mathematically equivalent to 6 CUP (as per the 1 CUC – 24 CUP rate), it is still valued at 5 Cuban pesos by the vast majority of private vendors. That means you will never get any change back if you buy something worth 5 CUP with that “dollar quarter.”

If you pay with a 50 “dollar cent” (CUC) coin, the vendor treats it as 10 CUP.

In a similarly conservative fashion, vendors maintain the old equivalences of 5 CUC cents = 1 CUP and 10 CUC cents = 2 CUP, even when one pays with many of these coins, enough to make the difference in value considerable.

Thus, 20 CUC nickels aren’t often equivalent to 23, 24 or 25 CUP, but only 20. The same holds for CUC dimes.

It is easier to convince one’s counterpart that one is giving them the equivalent of 1 CUC (23, 24 or 25 CUP, depending on the exchange rate) if one pays with 4 CUC quarters.

A bit complicated, isn’t it?

A certain Frenchman once said that people’s mentalities tend to be conservative.

I say that whoever laughs last laughs loudest.

Source: Conservative Mentalities and Cuba’s Exchange Rates - Havana Times.org - http://www.havanatimes.org/?p=104887 Continue reading
Cuba: "End of Dual Currency Won't Hurt the Population"
July 5, 2014
According to the head of the economic reforms Marino Murillo

HAVANA TIMES — The Cuban government said today that the planned
elimination of the dual currency on the island will not cause a price
increase or affect the "purchasing power" of the population, reported
dpa news.

The elimination of the dual currency prevailing on the island since the
90s "will have no effect" nor will there be "price increases for these
causes," said Marino Murillo, the official in charge of Cuba's program
of market reforms.

Speaking to the Cuban parliament meeting in Havana, the so-called "czar"
of the island's economic reforms said: "People's purchasing power"
(already one of the lowest on the continent) "will be respected."

Cuba has two currencies since 1994. The Cuban peso (CUP), which state
salaries and pensions are paid, and the convertible peso (CUC),
comparable to the dollar and whose exchange rate is 25 times that of
CUP. The hard currency is mostly used in the tourism sector and in
stores where imported products are sold, including many basic food products.

Raul Castro's government announced in October 2013, a "time table" to
eliminate the dual currency, considered by experts as a key reform
needed to boost the recovery of the Cuban economy. The change provides
for the elimination of the CUC.

The announcement of the reform caused some concern among sectors of the
population who have savings in CUC, often saved in cash at home.

Not the solution in itself

Murillo admitted that the monetary reform in itself will not solve the
problems of the Cuban economy, mired in a chronic crisis for over two
decades, after the demise of the Soviet Union and the socialist bloc.

The reform alone will not solve "the problems of the economy or solve
the purchasing power of wages," said Murillo, quoted by Prensa Latina.
Average wages in the large state sector on the island are around 20 CUC
a month.

Cuba recently lowered its economic growth forecasts for 2014 from 2.2
initially expected to 1.4 percent, due to a "higher than expected slowdown."

President Raul Castro today chaired the second plenary session of the
year of the Cuban legislature. Nearly 600 delegates of the National
Assembly are meeting behind closed doors on Saturday with the focus of
the gathering being economic and budgetary matters.

It is also expected that Raul Castro will close the session with a
speech that will be partially or totally published in the coming days.

The last time the full parliament met was in late March when it
unanimously approved a new foreign investment law, which seeks to kick
start the ailing economy with the arrival of capital from abroad.

Source: Cuba: "End of Dual Currency Won't Hurt the Population" - Havana
Times.org - http://www.havanatimes.org/?p=104685 Continue reading