Iván García, 19February 2018 — Pescao Designs, a project that is intended to offer decorative solutions to foreign businessmen, state-owned operations and small private businesses, began operation five years ago in the house of the founder, on Carmen 16 Street, in La Víbora, a neighborhood 30 minutes by car from the center of Havana.
Their initial equipment was technologically backward, but indispensable. Equipment that gave the impression it was antediluvian. The boss, Carlos, a 41-year-old automation engineer, seemed a lot like an orchestra conductor. He operated the machinery and looked over new contracts, which he organized at night, and he cleaned the garage that served as his office.
A family loan and a credit from the State bank, Metropolitano, were the capital with which he began to operate. “In the modern world, design is fundamental in all facets of life. Any design project in the U.S. or Europe counts on an investment of a million dollars or euros. I began with less than 20,000 dollars, which is nothing for this type of business. I learned along the way, and I substituted creativity for money.”
In spite of the olive-green Regime’s restrictions on small private business in Cuba, his business enjoys fame, credibility and good financial health. Carlos built an attractive air-conditioned office in a large house adjacent to his home. He has 12 workers on his staff. They were in charge of designing popular television programs, like Sonando in Cuba (Dreaming in Cuba), En Familia (In the Family) and La Colmenita (The Little Beehive). Also, he designed the stands for Havana Club and other businesses in the International Fair of Havana. Dozens of bars, cafeterias and private restaurants request his design services, for interior decoration up to menus and employee uniforms.
However, because of the restrictions and prohibitions on imports, equipment, state-of-the-art machinery, raw material and supplies are more expensive for private businessmen.
“Any piece of last-generation machinery costs more than a quarter of a million dollars. You have to buy the ink cartridges, 3-D design equipment and other material from middlemen who charge very large commissions. The ideal would be to import it directly from the wholesalers in Panama or Mexico, at much lower prices,” says Carlos.
When you chat with private businesses, one of their demands is authorization from the Government to import equipment or to accept credit from foreign banks.
Another problem to solve, considers René, the owner of a shop that offers software applications and computer equipment repair, is to eliminate “the stupid prohibition on allowing professionals to open their own business. It obliges many entrepreneurs to make false declarations on their taxes or to open a business under a license that isn’t theirs. In practice, in spite of the prohibition, thousands of professionals are working for themselves under the table. And they aren’t paying taxes.
“The most intelligent thing to do would be to legalize the whole framework, because it brings a value-added that the businesses of lodging, home restaurants and other services don’t generate. It’s absurd that the Government is putting brakes on progress. They should give up the primitive idea that being rich is a perverse crime. The State should combat poverty. And the function of the private sector is to create wealth.”
Since professionals don’t have the Regime’s consent to open a business, those that exist function in a judicial limbo, or illegally. Sahily, a lawyer, dreams about having a law office that advises foreign firms and private business owners and helps them to negotiate the bureaucratic process.
“The Government must understand that it cannot be both judge and defendant. Foreign businessmen don’t trust the State to handle legal matters. They prefer private law firms to advise them. But right now, the Government hasn’t figured out that if they want to see foreign investment grow, they have to change the law and permit the participation of private individuals, if they really want to interest company owners in establishing businesses in Cuba.”
Enrique, an architect with 10 years of experience, thinks that “now is the time for the State to permit architects and designers to create their own firms. We need a master plan for construction. There are Cubans who can now afford designs for their houses and businesses. This way a better quality would be guaranteed, and it would overcome the improvisation and present sloppiness in housing construction in the hands of private workers without a professional adviser.”
In December 2016, a group of private businessmen had a meeting with officials at the National Office of Tax Administration, the institution that governs private work in Cuba.
A well-informed source told Diarío Las Américas that “all the limitations by the Government that presently exist were considered, and innovative proposals were presented. If the private sector has shown anything, it’s that in services like consulting, among others, it functions better than the State. In the last seven years, we have never stopped growing. It’s calculated that more than 1,200,000 Cubans work in non-agricultural cooperatives or in private businesses. I believe we have earned the right to have the Government listen to us. In this first meeting, there were no commitments, but the Government officials took notes.”
As in any facet of life, private workers aspire to grow in quantity and quality. They think that private business isn’t the problem; it could be the solution to things that don’t function in Cuba.
Translated by Regina Anavy