Informacion economica sobre Cuba

POSTED ON Saturday, August 18, 2012 AT 10:48PM

Cubans eager to become small-business owners


Yakima Herald-Republic

HAVANA, Cuba — Two blocks off the Malecón, the 4-mile esplanade that

separates this city from the sea, a small but tidy room is ready and

waiting. An air-conditioning unit — its switch in the off position —

sits idly inside a wall painted the color of the Caribbean. New,

pink-flowered linens cover the bed.

But, so far, no guests have slept here.

With no Internet in their home — and no email account or website — the

mother-daughter duo that wants to rent this room in central Havana isn't

quite sure how to go about attracting customers. Both, each named

Lourdes, are eager to take advantage of recently loosened laws that make

it easier for individuals to rent out rooms — or go into a variety of

other businesses for themselves — in a country where private enterprise

has largely been prohibited for more than a half century.

"We are in a transition," says Rafael Hernández, a political scientist

and editor of Témas, an official Cuban government magazine covering

ideology, culture and society. "The old model is not what it was, and

the new model is not there yet."

Economic reforms were announced nearly two years ago. Today, according

to the Ministry of Labor and Social Security, there are some 371,200

self-employed workers on this island country of about 11.3 million. The

number is projected to grow to more than 600,000 by the end of the year.

And it doesn't stop there. While the government now employs about 85

percent of the workforce, its aim is to increase the private sector to

as much as half of the country's economy within the next five years.

"There's an agenda for change," says economist Jorge Mario Sánchez, a

professor at the University of Havana's Center for the Study of the

Cuban Economy.

The mother-daughter duo (Lourdes I and Lourdes II), who asked that their

last names not be used because they still fear the power of the

Communist government, exemplify the changes that are transforming

economic and social life in Cuba. They have been preparing to rent their

room since last fall, about a year after the tightly-controlled central

government declared intentions to relax restrictions and open a wider

portion of the economy to low-level capitalism. Sanchez said the

changes are deliberately slow.

"We have to build a new Cuban economy step-by-step, correcting what we

are doing every day," Sánchez says. "You have a government accustomed to

controlling everything, everyone all the time. … It is a very

distorted environment."

"Cuentapropistas," or the self-employed, are now permitted to work in

some 181 different job categories. Unlike the small-scale — and largely

reversed — changes made in the 1990s by former president Fidel Castro,

these recent measures are meant to be long-lasting and help pull the

country out of a stubborn economic crisis.

The situation is aggravated by the highly centralized government,

fragmented infrastructure and dual-currency system, among other

problems. Cuba, for example, has the lowest Internet-penetration rate in

the Western Hemisphere, making it difficult for newly minted

cuentapropistas — like the Lourdeses — to get the word out about their


But, if guests start staying in their room-for-rent, the mother-daughter

team will make double in one night what each used to take home in a

month, or about $30 compared to the $15 Lourdes I made as a lab

technician, or what Lourdes II made working as a notario, or legal

official. Similarly, owners of private, in-home restaurants, called

paladares, are able to charge more per meal than what they used to earn.

"This is the opportunity all of us Cubans want, the opportunity to move

forward on our own," Yeney Balmaceda Pérez, 23, says in Spanish through

a translator.

She runs Cuba Italia, a paladar in Old Havana, with her mom, Beralis

Pérez Guibet, 42. They serve a mix of Cuban and Italian meals — from

pizza to ropa vieja, a shredded beef dish called "old clothes." Since

opening 10 months ago, there have been nights all six tables — with four

chairs each — have been full. And there have been others with two

diners, or — worse — none at all.

"It's been very hard at times. There's a lot of competition," Guibet

says in Spanish through a translator. "All businesses come with a risk.

It could be good. It could be bad. It's too early."

While she's waiting to see whether her paladar will succeed, more

economic changes are likely on the way. They're a response, Hernández

says, to the global downturn in which Cuba's revenues from nickel,

tobacco, sugar and rum have dropped.

These days, people must pay for items that were once heavily subsidized

by the government, stretching their pesos even further than they did

before. Rations have been cut. Thousands are opting to venture out on

their own to see if they can make more as cuentapropistas under the

relaxed economic policies.

Were they going to revolt if change did not come? Not likely, according

to economic analysts. Living in Cuba is more about day-to-day survival.

They're probably more likely to become small business owners than stage

a revolt.

These new policies are, Hernández says, "very different from the

policies of Fidel."

Shortly after the 1959 revolution, Fidel Castro — who turns 86 on Aug.

13 — began expropriating major industries, including those owned by

foreigners, as well as nationalizing businesses and paying all workers

nearly the same wage. He also provided free education and health care,

and heavily subsidized other commodities, like utilities and food.

When Fidel Castro stepped aside in 2006 for health reasons, his younger

brother took over. The leadership change became permanent in 2008, and

President Raúl Castro, 81, began cutting back on subsidies as well as

pushing for more — albeit limited — private enterprise.

His aim is to cut a million government jobs — laying off more than about

20 percent of Cuba's 5.2 million state workers — by 2015 in the hope

that they will become self-employed and increase tax revenues.

Whether or not their room gets rented, the two Lourdeses must pay the

monthly tax: 150 CUCs, or the equivalent of five nights' lodging.

"We're worried. We're insecure, and we're worried," 50-year-old Lourdes

I, the mother, says in Spanish through a translator. While she's happy

for the opportunity, she also says she feels like "I have a noose around

my neck."

Like other aspiring cuentapropistas, she and her daughter, 26, also

illustrate the growing disparity between Cuba's two currencies: the peso

and the convertible peso, or CUC. Cubans need both to survive in their

society, which is characterized by a tiered system of consumption. A CUC

is worth the same as an American dollar. But there are 24 pesos to a

CUC. And the average Cuban salary, about $20 a month, is paid in pesos.

State-owned stores selling food and merchandise in pesos are sparsely

stocked. State-owned stores and private businesses that use CUCs offer

consumers more variety and higher quality — from fresher fruits and

vegetables to better home furnishings as well as luxury items. Many

goods and foodstuffs are only available in CUCs, introduced in 1994 as a

way to ease an earlier financial crisis created by the dissolution of

the Soviet Union and loss of Cuba's main patron.

Today, foreign visitors typically deal exclusively in CUCs. Besides

remittances, the easiest ways for Cubans to get the more valuable

currency is by working in tourism or jobs that involve direct contact

with tourists.

"If you work in a hotel, you are collecting tips. If you collect tips,

you can make more than a university professor," Hernández says.

Experience and education, skills and seniority don't factor in. Almost

everyone — doctors, lawyers, professors, sanitary workers, museum guides

— makes the same salary, except for those who work in tourism or for

foreign firms.

"It is not logical. It doesn't make sense that a private worker should

have a salary so high compared to a professional (who works for the

state), and that is just something we all know is true," says Lourdes I.

"That is a change that has not happened because the economy is so bad."

She says she would like to see the peso become as valuable as the CUC,

or — better — see Cuba change to a single-currency system. She would

also like to see salaries determined by experience and talent, not tourism.

"Tourism saved Cuba," she says. But, "before tourism existed, you could

live on 200 pesos," or about $8, a month. That's no longer the case.

While she lauds Cuba's free education and health care, subsidized

housing, utilities and basic rations, she worries about buying food.

State food subsidies are shrinking to essentials like rice, beans and

powdered milk.

Still, she says, it's not as bad as the so-called "Special Period,"

following the collapse of the Soviet Union. From 1991 to 1993, Cuba's

economy declined 35 percent. It was "really a nightmare," Hernández

says. "The certainty about the future was over."

Fidel Castro enacted emergency measures, including opening tourism and

creating the CUC. Most of the measures were scaled back once Cuba found

a new patron in Venezuela, which has been providing the island with

cheap oil since 2001. However, tourism and the CUC remain. In fact,

tourism is now Cuba's greatest source of revenue. But, says Sánchez,

"The value of the peso is going down and down."

That only widens the disparity between the value of the CUC and peso,

which is greatest — according to Hernández — among Cuba's blacks, young

people and women.

Before the "Special Period," he says, the difference in Cubans' real

income varied slightly, from approximately 100 to 450 pesos, or $4 to

$19. Today, he says, the difference has grown from 100 to 1,200 or 1,600

or more pesos, or $4 to $50 or $66, or more than three times the average

salary. Real income includes remittances as well as full time or second

jobs in the emerging private sector of which the two Lourdeses want to

be a part.

Both mother and daughter favor the relaxed restrictions and would like

to see more. Still, Lourdes II, a recent law school graduate, was

skeptical of her mother's plan to rent a room.

"I was afraid of the tax and the cost of remodeling," she says in

Spanish through a translator. Plus, it's her bedroom that was converted

for the new business.

• Adriana Janovich traveled to Cuba in June to study politics,

economics and a country in transition through the Annenberg School for

Communication and Journalism at the University of Southern California.

She can be reached at 509-577-7653 or

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