Author: 14ymedio

A decade after that decision, the authorities decreed that commercial transactions in the island could not be made in dollars, but only in Cuban pesos (CUP) and convertible pesos (CUC), the latter known popularly as chavitos.

However, “the currency of the enemy” remains an important reference point in the informal market.

The new emerging class hordes its savings in dollars while waiting for uncertain unification of Cuba’s two currencies

Entrepreneurs, artists who sell their works in the international market and Cubans who travel abroad are some of those who prefer the greenbacks. The new emerging class hordes its savings in dollars while waiting for the uncertain unification of Cuba’s two currencies.

The official exchanger rate that governs the US currency is very unfavorable. In exchange houses, every dollar is traded at 0.87 cents CUC, a price that has not changed for years and that especially affects those who receive financial assistance from their relatives abroad, a not negligible figure for the national economy.

Remittances sent to Cuba reached a record $ 3,354 billion in 2015, according to The Havana Consulting Group (THCG). The diplomatic meltdown between the two countries and the easing introduced by the Obama administration boosted the shipment of money and with it the upsurge of the informal currency market.

In March 2016, days before the visit of President Barack Obama to the island, the Cuban government announced the end of the 10% tax it had imposed on the American currency, a decision that excited much of the population.

Days before the visit of the President Barack Obama to the Island, the Cuban government announced the end of the tax of 10% it had imposed on the American currency

However, a year has passed since that announcement, and the measure has not been implemented. The authorities of the island justify the delay by asserting that they cannot yet conduct foreign trade operations with US currency as a result of the embargo.

In the banks and tourist businesses the buying and selling of Uncle Sam’s currency proliferates, parallel to the official networks. Many state employees are the bridge between foreigners and the underground market where the currency of the “empire” is sold.

Airports, despite strict surveillance, are the ideal site for this trade. Tourists arrive, the lines to exchange money are long, and individuals carrying bulging wallets wander among the travelers whispering the service they offer.

The guards and the banks themselves are linked to the black market. They earn a commission and keep a steady stream of dollars flowing into the illegal networks.

The dollar is also king in the monetary operations of those who want to get money out of the country. The currency is especially desired by mules who travel to countries in the region, such as Panama, the United States and Mexico, to import products such as footwear and clothing.

“This is a circular business,” says Henry, an informal entrepreneur who trades dollars. “The customer earns more than if he makes the exchange at the Cadeca and we get quantities of foreign exchange that you cannot go and buy from a bank,” he says.

The sale of foreign currencies in the country’s banking network is authorized but it is a complicated process. “Today I only have 120 dollars in the box so I cannot sell you any more,” a cashier from a Metropolitan Bank on Ayestarán Street in Havana told a client in need of foreign exchange.

In some bank branches they ask the customer to show an airplane ticket that justifies their need to acquire foreign currency for a trip. “I have walked through several banks and they tell me that they cannot sell me dollars or euros because they do not have them,” a resident of Havana’s Playa municipality complained last Friday, looking for dollars for a trip to Cancun.

On digital classifieds sites, there are many offers for the sale of dollars. Most advertisers prefer quantities that exceed of $ 1,000 and 50 or 100 dollar bills

On digital classifieds sites, there are many offers for the exchange of dollars. Most advertisers prefer amounts that exceed $1,000 and 50 or 100 dollar bills. “Selling at .96 cents a dollar,” one of these makeshift bankers says in an advertisement, promising “seriousness and reliability.”

“I have a house with five rooms and aterrace in the city of Cienfuegos, I want 50,000, half in convertible pesos and the other half in dollars,” says another classified in the popular portal Revolico. The practice is becoming more and more widespread.

“I do not want my money in these little colored papers (convertible pesos),” a musician, who performs in venues with a mostly foreign audience such as Dos Gardenias and La Casa de la Música de Miramar, explains to 14ymedio. Customers tip him “almost always in euros or dollars” and what he gets in CUCs he changes for “real money.”

His goal is to save enough to “spend a three-week vacation in Moscow and bring home things and clothes for the kids.” Spare parts for his Russian-made Lada car and a one-ton capacity air conditioner complete the dreams he wants to achieve with the green bills he keeps under his mattress.

The musician worries that “even tomorrow they could announce the monetary union and I would end up losing money” if it’s in one of the two national currencies. “The US Federal Reserve is there, it has several centuries of existence and gives me more confidence than the Central Bank of Cuba.”

“We started with two motorcycles and we already have five,” says Yosniel, an employee in a business in Havana’s Vibora neighborhood that offers Chinese food to order. “At the beginning we received few calls a day, but since more people heard about our offers, the phone does not stop ringing,” he adds.

AlaMesa, the most complete directory of food services on the island, has so far registered around 930 restaurants, bars, pizzerias and ice cream parlors throughout the country. In Havana, of 458 food retail businesses that appear, at least 66 offer the possibility of home delivery.

Paper ads pasted in public areas, telephone numbers along with photos of delicious dishes, and classifieds on digital sites are part of business strategies

Mamma Mia is one of them. In a beautiful house on 23rd street you can eat Italian-style pizzas and they also prepare the delivery orders for customers from several nearby districts. “When I don’t feel like going out, I phone and have it delivered,” says Victor Manuel Manuel, a dedicated customer of the place and resident of the area.

The diner believes that domestic consumers are becoming more and more enthusiastic about the possibility of ordering from afar. “People are wary if they can’t preview the food they are going to buy, but when the quality of a place has been proven, that distrust diminishes,” he says.

Víctor Manuel works with two friends in an interior design business on his own. “Sometimes we have to spend hours and hours doing drawings or designing on the computer, so having the option of having the food at the door makes the job much easier,” he says.

At the end of January of this year, 539,952 Cubans were self-employed, of whom 59,368 were engaged in the preparation or sale of food. Most in small cafes or very simple places, but sophistication and glamor also has a presence in the sector.

Home deliveries are a private sector fiefdom and for decades very few state-owned restaurants offered such a possibility. The dispatcher who arrived on a motorbike with the pizza in his hand was a “movie thing” for several generations of Cubans, until in 2008 when the opportunities for self-employment were expanded.

Liset and her husband Esteban have a service delivering sushi to order. This April is two years since they began to bring their exotic dishes to the customers’ homes. “We have offers of a roll that includes eight portions accompanied by wasabi, ginger and Japanese soy sauce, and also comes with vegetables,” the owner tells 14ymedio.

After living for five years in Costa Rica, the couple has returned to live on the Island and enters a new terrain. “Foreign businessmen based in the country, diplomats and Cubans who want to try new flavors,” says Esteban, describing his growing clientele.

“The main way we distribute our menu is the digital classified sites, but we also have a small brochure with prices and a ‘call at any time and we’ll take care of you’ advertisement. The text warns that for ‘larger orders for more than 20 people, order 24 hours ahead’.”

“The worst is when we are at a client’s house and he tells us that he made a mistake and that he will not buy the whole order because he does not have enough money,” says Liset. Without a prior reservation through internet or the guarantee of a credit card number in some online service, sellers can be victims of “jokes and false orders,” says the entrepreneur.

However, he says the incidence of these events is “infrequent” and that in general his experience is that business “is positive.” An advantage is that, “you do not need a large place or even have to invest in setting up a restaurant, just a phone line and a good organization in the kitchen.”

The entrepreneurs are planning to implement “a system of points and customer numbers to make ordering faster.”

Loyalty programs, rebates when a customer exceeds a number of orders per month and even small gifts to the most frequent customers, are some practices that are also beginning to spread. “Customers who put in more than two orders a month, we give them an extra menu item,” said Liset and Esteban.

The entrepreneurs are planning to implement “a system of points and customer numbers to make ordering faster.” They believe that in the emerging food sector, those who are “not creative will be left out in the cold.” They are betting on home delivery and “the future of the sale of food in Cuba,” says the seller.

A colorful motorcycle with the emblem of Banana City Delivery was traveling the central avenue of Rancho Boyeros in Havana this Monday. From a collective taxi, a passenger tried to write down the telephone number to place an order. An image that two decades ago was unthinkable on Cuban streets.