The much discussed Cuban dual monetary system, which has distorted the economy for more than twenty years, seems to be facing its final days. Among the few reports that have been released, it appears it will be the CUP–the Cuban or national peso–that will survive, and the CUC–or Cuban Convertible Peso– that will cease to circulate.
In addition to the actual value of each of these currencies, they differ in that the differ in that if the CUP has a photo of a historical figure, the CUC has a sculpture of the same personage. Also on security issues, CUC far exceeds its alter ego.
The question we ask ourselves is whether there will be a change in the real value of money we earn as wages. How many hours will one have to work–once the money is unified–to buy a pound of spaghetti, a quart of oil or a beer?
We also wonder if we will continue to earn the same and if the prices of merchandise will remain the same. For example, if a refrigerator sells now for 500 CUC, will we have to pay 12,500 CUP for it. To ride the same distance that we pay 3 CUC for in a hard-currency taxi, now costs 10 CUP in an almendrone (the shared taxis for Cubans). How will the price be adjusted when we have a single currency?
The amount of cash that will have to be carried to the store will force the artisans to make larger purses, unless they print new denominations with values of 500 and 1,000 CUP. Rumors are already circulating about the faces we’ll see on the new bills. Juan Almeida and Vilma Espín are the favored candidates.
Although almost no one in Cuba has enough money, some will save the abolished chavitos as souvenirs, at least the coins, a good opportunity for the numismatists.
17 March 2014