Juan Juan Almeida, 12 January 2018 — The Cuban Government is preparing a new blow to restrict the rights conceded to non-agricultural cooperatives of production (CNAs), specifically those devoted to the construction sector.
According to information obtained by Martí News, the Executive Committee of the Council of Ministers is developing a set of new judicial regulations with a view to controling the boom in this type of non-agricultural production association. One of the steps would be intended to complicate the process for the forming of these consortiums.
“The CNAs didn’t appear on the Cuban scene as a natural phenomenon regulated by the laws of the market, but rather as a result of an emergency strategy to attenuate the effects of the constant national crisis,” said a source from Havana who is linked to criminal proceedings against the owner of one of these private associations. “But some members of these associations drive around in rented autos, and the Government is trying to put the brakes on them by means of legal instruments that asphyxiate this enterprise.”
The source noted that the Council of State implemented, as an experiment, Decree Laws No. 305 and 306, No. 309 of the Council of Ministers, and another series of regulations for the forming, registration, functioning and termination of the non-agricultural production cooperatives and the services of 222 private activities.
The poor profitability and lack of autonomy of State businesses, among other factors, allowed the private entitites to achieve a real importance in the business system in a short time. They work efficiently, but they constitute an impediment to State businesses, because they show they do well, and they fearlessly exhibit the wealth they acquire.
On December 12, 2017, there appeared in the Gaceta Oficial Extraordinaria No. 58, a group of laws that intended to improve the business system by conceding a larger autonomy to State businesses. Even so, State production has not responded in the manner expected, because even with their increase in strength, they are incapable of guaranteeing service, quality and delivery times, according to the State authorities themselves.
However, the non-State sector continues to visibly increase productivity and labor discipline, which is why they have publicly received important contracts for the design and remodeling of tourism hotels, winning out over the now-stagnant State businesses.
“These corporations have better builders, do better work and, in certain cases, get permission to import machinery from China and other countries. However, the form in which they were originally designed and the experimental character of the whole legal basis mean they are badly limited,” argues an attorney who requested anonymity.
The lawyer explained that no legal way exists for two private cooperatives to join together to organize complementary activities to add value to their products or services. They have to acquire everything through the State businesses, and this doesn’t work.
“They have to violate the rules if the Government doesn’t expand the legal framework. How can you buy the necessary raw material like cement, sand, gravel, marble for the floors or wood for the formwork?” asked the lawyer.
“In this fradulent way,” he added, “they control the people in the cooperatives by submitting them to constant fiscal audits, which are practically impossible to pass. They now have closed some, and their members are in court.”
“We hope this will change, or we shall soon see the end of the private initiative,” the witness concluded.
This past August, the Ministry of Finance and Prices revoked the formation conceded to the Scenius Cooperative, an accounting service, and approved its termination for “repeated violations committed by the cooperative in its fulfillment of the approved social reach.”
The CAN experiment began in 2013, and presently there are only 429 of them in existence in the whole country, according to official figures.
Translated by Regina Anavy