14ymedio, Havana, 15 June 2016 — The Cuban government will apply price controls to private transport starting Monday, according to information broadcast on official television this Friday. The measure seeks to put the brakes on the rising prices of shared fixed-route taxis – the collectivos – serving various routes in Havana, due to the increase in the price of fuel which the drivers buy on the informal market.
The rates will return to the levels prior to the latest increase decreed by the drivers, who raised prices from 20 to 40 Cuban pesos (roughly from 75¢ to $1.50) on the longest trips and from 10 to 20 Cuban pesos (CUPs) on the shortest trips on the most popular routes, such as Lisa-Capitolio, Santiago de las Vegas-Fraternity Park or Virgen del Camino-Vedado.
Isabel Hanze Ruiz, acting vice president of the capital’s provincial Administrative Council, said on primetime news that the terms of the agreement made by the Council is being communicated to the drivers and compliance is mandatory.
Violation of the regulations “will be considered a very serious offense and offenders will be punished with confiscation of their license to operate privately,” the official added.
Most of the collectivo taxies, known as almendrones (after the almond-shape of the old American cars commonly used in this service), run on gas. The price at the official service stations is 1 CUC per liter (approximately 24 CUPs or roughly $4 US per gallon), but the taxi drivers primarily buy their fuel on the illegal market which is supplied by product “diverted” from State supplies.
Until the end of June, a liter of fuel on the black market cost between 5 and 8 CUPs. However, Venezuela’s economic problems and its failure to fulfill its commitments to supply oil to Cuba, has forced severe restrictions on the allocation of fuel to the state sector.
In most government run companies and institutions, delivery quotes of gasoline and oil have fallen by 30%. This decision has contributed to a reduction in the availability of fuel in the informal market, the scarcity of which has led to an increase in prices.
Some of the private taxi drivers, known as “boatmen,” have told 14ymedip that if they had to depend only on the fuel sold at state gas stations they would not be able to work, “because nobody would be able to pay the fares.”
Among the passengers who regularly use this service, there are fears that starting on Monday, 18 July, there will be a significant decrease in the number of shared fixed-route taxies on the streets of Havana.
It is not the first time this year that the government has used the policy of price caps. Some months ago, it did so in the state produce markets as well as those managed by cooperatives, which has contributed to shortages and a drop in quality of the products.