On Monday, March 14, the newspaper Granma published on the second page in huge point type, Agreement No. 30/11 of the Central Bank of Cuba Committee on Monetary Policy, where it was announced that from this day forward the dollar and the Cuban Convertible Peso (CUC) would have a parity of one-to-one in the whole country. Retirees and hopefuls, cautious Cubans who had saved their “bucks” waiting for a better opportunity, thought that for every ten dollars they would be given ten convertible pesos, as happened from 1994 until April 2005. Or so thought those who didn’t read as far as the seventh paragraph where this information was added:
“It should be clear that profit margins currently applied to foreign exchange operations will be maintained. The purpose of this is to cover the costs of financial institutions that provide these services.”
It was worse for those who didn’t read the eighth paragraph where it specified:
“Likewise, the current 10% tax applied to those who wish to buy convertible pesos with U.S. dollars remains in effect, as compensation for the costs and risks originating in the manipulation of the latter as a consequence of the irrational and unjust economic, financial and commercial blockade, imposed, for more than half a century, by the United States government on Cuba.
So the hundred turns into 87 and not 100 as the optimists believed. Seven more CUC cents for every dollar sent by family overseas means little in the domestic economy though it can’t be denied that it’s a slow and timid step toward making our finances healthy.
Although this decision still doesn’t affect the exchange rate between CUCs used to buy products in hard-currency stores and moneda nacional — Cuban pesos — in which wages are paid in State workplaces. We can assume that the 1-to-24 ratio for selling CUCs and the 1-to-25 ratio for buying them won’t last forever and I dare to conjecture that when this relationship is modified, appealing to the same rationality invoked now, it will not increase the value of the bills illustrated with photos (Cuban pesos), while those illustrated with statues (CUCs) are worth more.
March 14, 2011