Reinaldo Escobar, Havana, 5 August 2017 — The brake announced last June has just materialized. By canceling the awarding of licenses in several areas in which people have been allowed to work for themselves, and stopping the award of new licenses in several others, the government has confirmed fears about the advance of the private sector, and put at risk the small spaces of efficiency won by the population.
This week the Official Gazette published the decision to not grant new authorizations for this form of non-state management “until the perfection of self-employment is concluded.” This formula hides a misleading term — perfection — too subjective to be the object of legislation.
Fears are also growing before what remains to be achieved. Both the last Council of Ministers as well as the recently concluded session of the National Assembly, made clear that there is a package of regulations directed at the self-employment and cooperatives sector that will be announced in the coming months.
Many business owners fear losing their investment if draconian requirements are applied to them, but those principally affected may be the consumers. They are facing the risk that the good service and better quality that the private sector has achieved in areas such as food service, lodging, appliance repair and transportation, among many others, could be a thing of the past.
This week’s decision was preceded by official statements about illegalities and tax evasion. It is expected, then, that the upcoming regulations will aim at prioritizing the fight against violators, rather than seeking solutions such as the establishment of wholesale markets, commercial import permits or tax incentives.
Punishment and penalization seem to be the only ways in which the Cuban government deals with its citizens. On detecting irregularities the only way the government resolves them is with coercive measures, such as suspending the issuing of licenses, an increase in the number of inspectors, or the demonization of the economic prosperity achieved by the most successful.
This confrontational attitude shows that autonomous forms of management continue to be a necessary evil for the ruling party, while the figure of the small businessman remains an antagonist of the “New Man,english beach blue flag status
” which was once intended to be created. The enemy does not land on the coast or found opposition parties, but offers tasty pizzas at home, manages beauty salons and opens websites to promote its services.
The government is trapped in a contradiction. On the one hand the government wants to prevent the private sector from growing too fast, but it exhibits the sector as an example of the progress of the reforms promoted by Raúl Castro. At the end of the first half of this year, the growth of those engaged in self-employment, with 567,982 workers, has been used in international forums and debates as a sign of openness and development.
However, that figure may be affected in the coming months. When the licenses returned by those who were disappointed and failed to succeed exceeds the number of licenses issued for new affiliates. It is easy to predict a decrease or at least a paralysis in the volume. Stagnation and the duration of this slowdown will have negative repercussions on the exercise and influence of the private sector in the national economy. A digression that could cause enthusiasm to decline and paranoia to grow.