14ymedio, Elías Amor Bravo, Economist, 23 June 2023 — We already know that Cuban President Miguel Díaz-Canel went to the Summit for a New Global Financial Pact in Paris with nothing to offer. At the expense of the meager Cuban budget, basically, he took some souvenir photographs, checked in with friends like Lula and Guterres and said things that could very well have remained unsaid. But of course, as president pro tempore of the G77+ China, he has several doors open to forums like this, and you know, you have to denounce the embargo/blockade wherever and however. Public spending in Cuba finances this kind of thing. There is no investment in housing or infrastructure, but not a penny is spared in propaganda.
After all, attending these conferences does not usually have any benefit other than the media coverage, and one should not expect anything else. The only one who wins from all this is Foreign Minister Bruno Rodríguez, who is seen with a nervous smile behind his boss in all the photographs. He has managed to stick his nose into a conference that has been foreign to Cuba. Welcome!
The whole thing wasn’t much fun. Just a few minutes before it began, not far from the headquarters of the summit, a building had exploded with a gigantic column of smoke, and it was also raining, a typical Parisian day, gray and dark. The inauguration of the event was given by French President Macron who, sitting in shirt sleeves next to Díaz-Canel, did not look very comfortable in the day’s sessions.
And then, when his turn came, Díaz-Canel took advantage of his moment of glory and launched into a speech that can best be described as harsh, diffuse and critical of the central theme of the event, which was the definition of a new contract between the North and the South to face growing challenges related to climate change and development in this context of multiple crises. His advisers were not wise with the content or the statement.
According to the Cuban communist press, Díaz-Canel was grateful for the invitation to participate in the Summit for a New Global Financial Pact, which he described as “another starting point towards a broader intergovernmental process of discussion and decision-making within the framework of the United Nations.”
He presented himself as president of the Group of 77+China, which he described as “the most representative group of developing nations and the one that has historically been the flag and spokesperson for the claims that bring us together today.” Sheer propaganda.
Having said the above, he went into the matter, noting, “I do not reveal any secret if I affirm that the most nefarious consequences of the current international economic and financial order — deeply unjust, undemocratic, speculative and exclusionary — have a stronger impact on developing nations.”
Of course, I would not expect much applause when saying this kind of thing, which no longer connects even with the most revolutionary France of all time. Messages of this caliber are not only part of an ideologized analysis of reality, but they no longer serve to define the current scenario of the world economy.
In the crazy and undiplomatic thesis of Díaz-Canel’s speech, he said that “it is our countries that have seen their external debt practically double in the last ten years, that have had to spend $379 billion of their reserves to defend their currencies in 2022, almost double the amount of new Special Drawing Rights allocated to them by the International Monetary Fund.”
But of course, at no time did he say that Cuba’s indebtedness is not mandatory or forced, that no one uses a shotgun to force it into debt. However, the countries that go to the financial markets, get loans and then spend without control, without rhyme or reason, so that the impact of the investment is zero, only get into more debt. As Fidel Castro said, indebtedness is not something bad. What’s bad is the country that receives the money and then wastes it.
And of course, Díaz-Canel said that “in such unfavorable conditions the South cannot generate and access the 4.3 billion dollars annually necessary to achieve the Sustainable Development Goals in the remaining decade of action.” Of course he can’t agree, because Cuba doesn’t pay its lenders, as was proven in the London trial.
But let’s not generalize. There are countries of the South that receive generous investments, loans and financing every year because they are up to date on payments, and thanks to that the South develops and becomes “North.” But Díaz-Canel doesn’t understand this scheme, nor does he share it, and he doesn’t want to and can’t see it. As a reactionary communist, he is anchored in ideological positions unrelated to the world in which we live.
That is why he further hardened his speech by saying, “our people cannot and should not continue to be laboratories of colonial recipes and renewed forms of domination that use debt, the current international financial architecture and unilateral coercive measures to perpetuate underdevelopment and increase the coffers of a few at the expense of the South. It is urgent, like the greatest of all emergencies, to have a new and fairer international order.” This argument is false, and, in addition, those laboratories and recipes are only present in a mind incapable of understanding reality and benefiting from it. That argument of the enrichment of a few at the cost of the South could have worked in the 60s of the last century, but not today.
Díaz-Canel’s recipe, to the misfortune of Cubans, is the same as the one of Fidel Castro, who evaded the current situation and said, “it will be essential to face, as has been discussed here today, a reform of international financial institutions, both in matters of governance and representation and access to financing that properly takes into account the legitimate interests of developing countries and expands their decision-making capacity in financial institutions.” And who is going to be in charge of the reform? Díaz-Canel and those who don’t pay, maybe? What does Díaz-Canel intend to do, perhaps control the lending banks and decide who receives the money?
But then, contradicting his previous allegation, he said that “in the 21st century it is unacceptable that most of the nations of the planet continue imposing on us obsolete institutions inherited from the Cold War and Bretton Woods, far from the current international configuration and designed to profit from the reserves of the South, perpetuate the imbalance and apply interim solutions to reproduce a scheme of modern colonialism.”
The Cold War, if I remember correctly, ended in 1989 with the fall of the Berlin Wall and a year later with the collapse of the Soviet empire and the ideology that sustains the Cuban regime. It’s too bad he didn’t realize it. But the international order of Bretton Woods, which Díaz-Canel mentions, disappeared almost twenty years earlier, when the gold standard was abolished and the free flotation of the dollar was decreed. But it’s okay. Díaz-Canel believes that these institutions are still in force because his regime has been locked in a time capsule that was closed in 1959 and that has not been touched by reality since.
At this point, he devoted himself to saying things he does not know about, such as, “multilateral development banks must be recapitalized to improve their lending conditions and meet the financial needs of the South. This includes the call for countries with unused Special Drawing Rights to redirect them towards these banks and developing countries, taking into account their needs, special circumstances and vulnerabilities.”
Díaz-Canel wants to recapitalize banks with money of dubious origin. If indebted countries do not improve their balance of payments, the only way to increase money to meet financial needs is the international monetary expansion that generates more inflation. He doesn’t know what he’s talking about.
Subsequently, he asked that “official loans be increased for the achievement of the Sustainable Development Goals. Our countries need additional resources that are supported by concrete actions in terms of market access, capacity building and technology transfers.”
Cuba barely produces 5% of its energy from renewable sources. But it should really invest in these projects and not waste money on unproductive current spending. In no case is any clue offered as to who is going to pay off the loans. This does not enter into Díaz-Canel’s perspective.
And then, to close, he asked for measures of progress in terms of sustainable development that go beyond the gross domestic product. Fortunately, he did not dare to cite the “human development index” of the United Nations that places Cuba in an astonishing 77th place out of almost 200 countries in the world. He also referred to climate change and described as “deeply disappointing the goal of mobilizing 100 billion dollars a year up to 2030 for climate financing.” He added non-compliances and the impact of inflation, undoubtedly thinking about the one that currently hits the Cuban economy, a 45.5% year-on-year rate in May, which rises to 66% in the case of food.
And he closed by going into harangues in defense of the 2030 Agenda and its Sustainable Development Goals and of alleged North-South relations and coexistence on the planet. Plus he quoted Fidel Castro in a speech from 10 years ago: “Today it is possible to prolong the life, health and useful time of people; it is perfectly possible to plan the development of the population by virtue of increasing productivity, culture and the development of human values. What are you waiting for to do it?” I repeat, the hermetic time capsule with which Castroism has locked up Cubans since 1959 is impregnable.
Díaz-Canel said goodbye with something like “Let’s not ignore the warnings, let’s not underestimate the emergencies. Let’s act with a sense of being an endangered species. Let’s act with a sense of humanity.” He should take good note of his own harangues. The situation to which his policies have led the Cuban people are very similar to that agonizing description that is difficult to find in the world of the second decade of the 21st century. What Diaz-Canel can be sure of is that, with this type of speech, they are not going to give him money. The cupboard will still be empty. When will he learn?
Translated by Regina Anavy
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