Informacion economica sobre Cuba

Revolution in retreat

Under Raúl Castro, Cuba has begun the journey towards capitalism. But it

will take a decade and a big political battle to complete, writes

Michael Reid

Mar 24th 2012 | from the print edition

WHEN ON JULY 31st 2006 Cuban state television broadcast a terse

statement from Fidel Castro to say that he had to undergo emergency

surgery and was temporarily handing over to his brother, Raúl (pictured

with Fidel, left), it felt like the end of an era. The man who had

dominated every aspect of life on the island for almost half a century

seemed to be on his way out. In the event Fidel survived, and nothing

appeared to change. Even so, that July evening marked the start of a

slow but irreversible dismantling of communism (officially, "socialism")

in one of the tiny handful of countries in which it survived into the

21st century.

Raúl Castro, who formally took over as Cuba's president in February 2008

and as first secretary of the Communist Party in April 2011, is trying

to revive the island's moribund economy by transferring a substantial

chunk of it from state to private hands, with profound social and

political implications. He has abolished a few of the many petty

restrictions that pervade Cubans' lives. He has also freed around 130

political prisoners. His government has signed the UN covenants on human

rights, something his brother had jibbed at for three decades.

Repression has become less brutal, though two prisoners have died on

hunger strikes. Cubans grumble far more openly than they used to, and

academic debate has become a bit freer. But calls for democracy and free

elections are still silenced. The Communist Party remains the only legal

political party in Cuba. And Raúl Castro has repeatedly dashed the hopes

of many Cubans that the hated exit visa, which makes it hard (and for

some, impossible) to leave the country, will be scrapped.

The economic reforms, set out in 313 "guidelines" approved by a

Communist Party congress in April 2011, are being implemented slowly and

with great caution. That is because they face stubborn resistance from

within the party and the bureaucracy. Indeed, the leadership shuns the

word "reform", let alone "transition". Those terms are contaminated by

the collapse of the Soviet Union, an event that still traumatises Cuba's

leaders. Officially, the changes are described as an "updating" in which

"non-state actors" and "co-operatives" will be promoted. But whatever

the language, this means an emerging private sector.

The new president often says his aim is to "make socialism sustainable

and irreversible". The economy will continue to be based on planning,

not the market, and "the concentration of property" will be prohibited,

Raúl Castro insisted in a speech to the National Assembly in December

2010. He is careful not to contradict his elder brother openly: his

every speech contains several reverential quotes from Fidel, who despite

his semi-retirement is consulted about big decisions. (For brevity and

clarity this report will refer to each Castro brother by his first name.)

Fidel's frail and ghostly presence in his compound in Siboney, a leafy

enclave of mansions on Havana's western outskirts, doubtless checks the

speed of reform. But he no longer controls the levers of power and

rarely comments on domestic politics.

This special report will argue that whatever the intentions of Cuba's

Communist leaders, they will find it impossible to prevent their island

from moving to some form of capitalism. What is harder to predict is

whether they will remain in control of the process of change, or whether

it will lead to democracy.

No turning back this time

When the Soviet Union collapsed in 1991, many outsiders believed that

communism in Cuba was doomed. Massive Soviet subsidies and military aid

for Cuba had offset the economic embargo imposed by the United States in

1960. By the 1970s they had also brought stability after Fidel had all

but bankrupted the island by his manic shifts from forced

industrialisation back to exaggerated reliance on sugar, the economy's

mainstay since colonial days. The overnight withdrawal of Soviet

subsidies and trade links caused Cuba's economy to contract by 35%

between 1989 and 1993 (see chart 1).

In response, Fidel declared a national emergency, dubbed "The Special

Period in Peacetime". He opened the island to foreign investment and

mass tourism and legalised small family businesses and the use of the

dollar. But then he found a new benefactor in Venezuela's Hugo Chávez,

who began to provide Cuba with cheap oil. A big chunk of that is

officially counted as a swap of oil for the services of some 20,000

Cuban doctors, sports instructors and security advisers working in

Venezuela. China, too, emerged as a new source of credit.

Thus bolstered, Fidel reversed course again. Many family businesses, as

well as some foreign ventures, were shut down; the dollar ceased to be

legal tender in 2004. The ageing leader launched "the Battle of Ideas",

sending out armies of youths as ill-trained teachers and social workers.

This time, Raúl has insisted, there will be no turning back: the reforms

will happen sin prisa, pero sin pausa (slowly but steadily). But Raúl is

no liberal. He and Ernesto "Che" Guevara, the Argentine adventurer who

died in Bolivia in 1967, were the orthodox Marxists among the leaders of

Fidel's Rebel Army, the ragtag band of bearded guerrillas who toppled

the corrupt, American-backed dictatorship of Fulgencio Batista. As

defence minister from 1959 to 2008, Raúl set up and led Cuba's

formidable armed forces.

When Raúl took over from Fidel, he moved slowly at first, amid factional

fighting. To general surprise, the men who lost out in 2009 were Carlos

Lage, who had run the economy since the Special Period and was seen as a

reformer, and Felipe Pérez Roque, the young foreign minister. They were

denounced for having criticised the Castros (Mr Lage was caught on tape

describing the leadership as "living fossils") and for having been

corrupted by power. Instead, José Ramón Machado Ventura, an 81-year-old

Stalinist, was named as Raúl's deputy.

But Raúl also quietly discarded nearly all of Fidel's ministers and key

aides. Their replacements are mostly army officers. Rafael Hernández, an

academic who edits Temas, a quarterly journal attached to the culture

ministry, points out that many of them are engineers by profession.

Fidel ruled Cuba through the unbridled exercise of his massive ego. He

centralised all power in his own hands, imposed Utopian egalitarianism

and performed frequent policy swerves. By all accounts, Raúl is more

modest, by nature a delegator and team-builder, more interested in

getting things done than making speeches. When he took over in 2006 he

put an end to the 4am meetings his brother loved. He is the Sancho Panza

to Fidel's Don Quijote (they even look the parts).

Raúl seems to be acutely conscious that Cuban communism is living on

borrowed time. The economy is grossly unproductive. Venezuelan aid in

2008 was offset by devastating hurricanes and the knock-on effects of

the global financial crisis on Cuba's tourism and trade. The country is

running down its capital, but living standards remain frugal. Its famed

social services are no longer affordable. The population is shrinking.

Mr Chávez, its Venezuelan patron, is being treated for cancer and faces

a close election in October. And the Cuban leadership is gerontocratic:

Fidel is 85, Raúl is 80 and the average age of the Politburo is over 70.

The históricos, as those who fought in the revolution are known, are

dying off. With Mr Lage gone, they have no visible successors. Raúl's

opportunity to institutionalise the system has come very late in the

day. "We either rectify things, or we run out of time to carry on

skirting the abyss [and] we sink," he warned in his December 2010 speech.

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