Moringa Attacks Again

An old edition of Granma, the official newspaper of the Cuban Communist Party (and so the official newspaper of Cuba), follows Fidel’s lead and gets all excited about the Moringa tree’s ability to supply Cubans with “an inexhaustible supply of milk, eggs and meat.”

14ymedio bigger14ymedio, Elías Amor Bravo, Economist, 29 May 2023 — We all remember that back in 2012, Fidel Castro, already retired from the political front line, began to publish a series of articles in the state press to explain, with quasi-scientific details, the properties of moringa and mulberry. Those explanations drew attention, because after a long life at the head of the regime created by his communist revolution, no one thought of Fidel Castro as an amateur scientist, much less, as a moringa specialist. So, in that article now distant in time, Castro devoted himself to detailing the benefits that, according to him, could be attributed to moringa, a plant native to India that had all types of amino acids and numerous medicinal properties, although he clarified at some point that it should never be consumed in excess.

Castro’s article went on to point out that “we have supplied samples of seeds of different varieties to agricultural research institutes. Soon we will learn more about its potential. From my point of view, its greatest benefit for the population lies in its qualities as animal consumption for the production of meat, milk, eggs, and even the cultivation of fish,” something like the Castro manna that can do anything.

So those “scientific” collaborations coincided with the aggravation of the ailments that the old revolutionary was already suffering at the time, at age 86, and the state press used them as a talisman to stop the tide of rumors about an alleged worsening of his health. From that time the images of a Fidel Castro in a wheelchair visiting moringa fields are remembered, and in one of his last collaborations, he proposed the massive cultivation of these vegetables as alternatives to food and for health.

Some time later, and once the old dictator died, the regime did what it had to do, and in that way, by 2018 the council of ministers approved the creation of the science, technology and innovation entity “Sierra Maestra,” with the aim of investigating and putting into practice the reflections of the late Cuban dictator related to the medicinal properties of moringa and other plants that occupied his “studies.” No expense was spared for this project; it was, as on other occasions throughout history, about validating Castro’s ideas and proposals, no matter how absurd they might seem. Ideas that bordered on “devotion” for the moringa tree and its medicinal properties. Rivers of ink ran. continue reading

Fidel Castro had not said it, but his followers, determined to give continuity to those “collaborations” stressed that “the conditions are created for the country to begin to massively produce moringa oleífera and mulberry, which are also inexhaustible sources of meat, egg and milk, (and) silk fibers that are spun by hand.”

In this way, coming out of nowhere, the “Sierra Maestra” institution was aimed at guaranteeing, in addition, the continuity of the investigations ordered by Castro, related to the production of silk, fodder and the sacha inchi, the native seed of the Peruvian Amazon known as the “peanut of the Incas,” much appreciated for the properties of its oil.

And you will wonder, what is all this about?

Well, the heirs of Fidel Castro, in 2023 have launched the first integral moringa powder plant in Cuba, inaugurated in La Sierpe, Sancti Spíritus, destined to produce 20 tons. According to the state press, “the powder will have three destinations of vital importance for the development of the nation: the pharmaceutical industry, export and as a nutritional supplement in the manufacture of cookies,” a project conceived by Fidel Castro and, as it could not be otherwise, “an honor for us to comply with it.”

Apparently the entity has state-of-the-art technology of Austrian origin — you can imagine the cost — “and the processor dries the leaf in conditions of airtight darkness, avoiding the denaturing of chlorophyll and other nutritional properties of the tree.”

It is assumed that the plant will have various benefits for the local economy, such as “providing a nutritional supplement for human beings, as well as, from the protein content of the green mass, food for sheep, goats, pigs and birds,” following the script of Fidel Castro, who identified moringa “as a miraculous tree of life, light and hope, like an angel turned into plant. It is a very complete food.”

The inauguration of the entity was attended by Jorge Luis Tapia, member of the central committee of the party and deputy prime minister, and the division general of the reserve Ulises Rosales.  Teresita Romero, governor of the province, also participated. We are talking about moringa again after 11 years.

Translated by Regina Anavy


COLLABORATE WITH OUR WORKThe 14ymedio team is committed to practicing serious journalism that reflects Cuba’s reality in all its depth. Thank you for joining us on this long journey. We invite you to continue supporting us by becoming a member of 14ymedio now. Together we can continue transforming journalism in Cuba.

The Electricity Crisis in Cuba From Bad to Worse: Towards a Long and Warm Summer

Cuba’s thermoelectric plants are routinely out of service. (14ymedio)

14ymedio bigger14ymedio, Elías Amor Bravo, Economist, 28 May 2023 — If the current scenario is maintained, the forecast for the coming months is that the blackouts will continue and this when now the hottest months of the year arrive, in which consumption becomes more necessary to face the high temperatures. The situation of the national electricity system, despite what Economy Minister Alejandro Gil said in the national assembly, is one of the absolute inability to comply with the strategy outlined to reduce blackouts during the summer holidays, when demand levels increase in a sustained way.

There is a fairly widespread sense of absolute failure to solve the fuel deficit in the nation. These are the conclusions of an interview in the state press of the minister of the branch, Vicente de la O Levy, in whom many hopes were placed when he was appointed, raising expections that he could address a situation that worries all Cubans. Well, no, realism forces us to think that the problem continues and that neither the generation of electricity in the country nor the sale of fuel in the service centers will be normalized in the short and medium term.

The minister explained some of the actions implemented by the regime, all of them unsuccessful. He cited, for example, what he called “sacrificing the power that was available, with the aim of increasing maintenance work and gradually reducing  breakdowns.”

A work that was carried out “in the worst conditions of supply of spare parts, materials and raw materials for not having access to financing or suppliers, due to the resurgence of the blockade and the inclusion of Cuba in the arbitrary list of countries that support terrorism, prepared by the United States Department of State.”

That is, power plants mostly from Eastern European countries in Soviet times that make up Cuba’s electricity grid cannot renew their parts because of the ’blockade’. But does the ’blockade’ affect Cuba’s trade with these countries? Can the parts only be purchased in the United States? continue reading

It doesn’t look like it. The thing is that there is no money at all, and that includes for the purchase of the parts. Nor is there money for many other necessities that have to be imported, which Cuba can’t buy because it doesn’t have the credit to do it. This is what happens when the debts are not paid and the international markets do not give loans. In such conditions, without parts, the results of maintenance and the recovery of power that had been out of service for some time have not allowed a decrease in the blackouts. It’s a failed measure.

The minister insisted on his task of increasing the maintenance load from February, and for this, he decided to pull the consumption of units such as Céspedes and Felton to meet this objective. In such extreme and complex conditions, the average number of hours of affected each day was only reduced to three hours, “being able to rotate the scheduled blocks every four days, except for the days when the system was completely disconnected.” The fact is that the blackouts continued, because their continuous appearance is the result of much more complex factors that are not fixed with these juggling exercises.

And in addition, in a short duration. The minister explained two situations that occurred a short time ago and generated complications: the failure of the fuel supply as a result of a shortage from suppliers (he said that 400 W were left out for this reason) and the exit of the Guiteras thermoelectric plant due to a large-scale breakdown. As a result, the hours when electrical service is affected were extended in almost the entire country, and the alleged improvements in the Céspedes and the Felton plants passed on to a better life immediately.

Looking ahead to the summer, the minister listed some of the actions that are undertaken so that the situation does not worsen, including “the maintenance of Felton 1, the recovery of unit 6 of the Mariel, the maintenance in the Cienfuegos thermoelectric plant, the recovery of power of the engines of the Mariel and Moa, the elevation to 300 MW of the generation of Energas, the recovery of more than 600 MW in distributed generation and the incorporation of new fuel-oil engines (100 MW).” All hasty and with a lack of parts because there is no credit to buy. A bad business.

In particular, and with regard to the effects in Energas, he said that “after several days with more than 300 MW of generation for having drilled a first well of three that are giving us more than 200,000 cubic meters of gas, last Sunday a breakdown occurred that took out all the generation units and limited the manufactured gas destined for the population in the capital.” Then he added that “the service was restored immediately and power has been recovering, until next week, when, again, 300 MW will be delivered.”

The minister believes that with the Guiteras and Energas, before the end of May there will be a considerable decrease in the affected periods and a few months of summer in better conditions. He insisted that “daily, our people have been kept informed about the situation of the national electricity system and of each of these actions,” a measure that also does not solve the problem of the blackouts, and that contributes, even more, to tightening social needs.

The minister also referred to the situation of the 1,000 distribution transformers, which suffered damage during the passage of Hurricane Ian and are being gradually replaced, with priority for strategic sectors such as agriculture. Ian happened in September 2022, soon approaching a year, and they are still trying to solve the problems.

Then, at that time, according to the minister, “it was decided, in addition to taking from the state reserve, to use those that were in the centers of the economy to install them and provide service to the population.” And in this regard, he said that “at the moment raw material for the national production of transformers is arriving in the country, and with this it will be possible to gradually replenish those that were taken, prioritizing strategic sectors such as agriculture.”

And at this point, the minister called on the population and the sectors of the economy to save electricity and fuel, “making a rational and efficient use of energy,” a message that has little to do with the reality of a country in which if consumption is squandered it is not for the population, but for the high level of consumption that the state needs for its platforms of economic control in all areas of economics and society. The communist state is the great squanderer of electricity consumption in Cuba. In addition, it does not pay for it, since everything is charged to the same account. A disaster.

The minister said he hopes that “the lines in the service centers and the situation with the fuel will recover significantly.” Regarding this worrisome aspect and its undesirable effects, the minister said that “we have not had to go to a zero fuel option, with gigantic financial efforts,” but the lines at the gas stations do not seem to indicate that.

The problem is that the lack of fuel in Cuba is generalized not only to gasoline but also to diesel from service and electricity, turbofuel for airlines and to all petroleum derivatives in general. Nobody at this point asked the minister how the production of renewable electricity is going, which barely reaches 5.5% of the total, one of the lowest in the world. Nor has the minister done much to improve this result, which is essential.

Translated by Regina Anavy


COLLABORATE WITH OUR WORKThe 14ymedio team is committed to practicing serious journalism that reflects Cuba’s reality in all its depth. Thank you for joining us on this long journey. We invite you to continue supporting us by becoming a member of 14ymedio now. Together we can continue transforming journalism in Cuba.

Cuba’s 64 Years of Agrarian Reform: Nothing to Celebrate

A farmer works on the sugar cane crop in Maduga, Maraeque. (EFE/Ernesto Mastrascusa)

14ymedio bigger14ymedio, Elías Amor Bravo, Economist, 21 May 2023 — Fidel Castro activated a plan, not deviating one millimeter from its content, for seizing power in Cuba following the fall of the Batista regime. And in that plan, one of the first actions — when the execution machinery was in full swing at La Cabaña fortress — was the agrarian reform law. The law was one of the plan’s media events, and so Castro decided that the setting for its signing should be the Sierra Maestra de La Plata* in Bartolomé Masó municipality, Granma province — located more than 1000 kilometers away from the ministerial offices of the capital — where panic was starting to spread among state officials. It all happened on May 17, 1959. It’s been 64 years now. A lifetime.

The Castro regime turned the agrarian reform into one of its main points of reference. So much so that, at the international level, others tried to copy it, but in the end threw in the towel. The usurpation of economic power that took place in Cuba in favor of the state caused a trauma that was very difficult to overcome in a productive sector that, until then, had generated enough food to feed the entire population, and had two export products with which it obtained income from abroad: sugar cane and tobacco. Never after in history have there been similar processes in other countries of the world.

Agrarian reform took place in Cuba because the circumstances of the moment allowed it. The economic powers that could have opposed those measures now had nothing to do but escape repression and death. And the political powers were dragged down by the revolutionary pressure. Not even the president of the republic, Manuel Urrutia, forced to resign in July, and who ended up taking refuge in the Venezuelan embassy, ​​or Miró Cardona (whom Castro himself had replaced in February) had anything to say in the matter.

The only protagonist from then on was Fidel Castro, who appropriated, on the other hand, a program that was not his, but which served him well. In fact, the author of the text, Humberto Sori, minister of agriculture, resigned days later when he saw that his attempt to protect Cuban agrarian interests was falling on deaf ears. Sori was executed on April 20, 1961, shortly after the Bay of Pigs invasion. He did not see the end result of the reform in which he had to submit to the dictates of Che Guevara.

In reality, when that agrarian reform law was signed in the guerrilla and campesino landscape of Bartolomé Masó, few of the guajiros** present at the act knew what it was all about. A law that, up until the last moment, was being touched-up by Che Guevara as efforts were made to explain to those around there what the whole thing was about. continue reading

For Castro’s propaganda, which already in those months of 1959 had entrenched itself to influence society with its messages, the law was a triumph, one more victory for Fidel, the first revolutionary measure aimed at “restoring hope to the humblest” and at the same time, promote a profound transformation of Cuba’s economic and social structure. However, the law was full of inconsistencies and falsehoods that, with time, could be more than verified.

To begin with, it established a presumed right of the farmers who farmed the land to own the land. But this was not the case, since what the law really did was to pass the large estates and large private farms, in which sugar cane production or livestock economy was carried out, into the hands of the state. Marxist collectivism turned the communist state into the main owner of the land, of the means of production, while the existing farmers were forced to accept small plots of land from which they could do little more than produce for their own consumption.

The communists claimed that before the law, 1.5% of the owners owned more than 46% of the national land area. After the agrarian reform, a single owner, the state, came to hold practically 54.2% of the land area, a percentage that increased over time until it reached almost 80% before Raúl Castro’s reforms, while independent farmer participation was practically marginal. And the most alarming part was that the land in the hands of the state remained idle, without being put to use, which reduced productivity and yields, forcing the Island to import food that it used to produce.

In addition, the law made inefficient smallholdings the main feature of agriculture. In effect, the maximum limit of land that a natural or legal person could own was established at 30 caballerías (402 hectares)***. Castro’s plan was to consolidate small agricultural property, tying the farmers to the land, in order to prevent rhwie progress, accumulation of wealth and development. The law turned former tenant farmers into poor small landowners, with little or no possibility of accessing more land to increase the economies of scale.

It is true that more than 100,000 property titles were granted and that this benefited some 200,000 farming families, but with economic and social costs that ended up causing structural damage to the productive sector, from which it never recovered. After the reform, no farm in Cuba reached more than 100 caballerías.

Thus, the law put an end to large estate ownership and foreign private possession of land by creating an army of poor farmers, who, after a while, were forced either to work as wage laborers on state farms, or to join cooperatives controlled by the communist party to market their admittedly limited productions. The result of these changes was immediately evident: loss of technology, capital, and investments, causing irrecoverable damage.

The communist narrative of agrarian reform insists on drawing a scenario in which the transformation of the Cuban countryside manifested as a fatal blow only for the national and foreign landowners, and in particular for the Americans. It has even created a false image that these sectors, “wounded in their pride and displaced from their bourgeois and landowner position, later led, in exile, the countless campaigns and actions that since that time and to date have been orchestrated against Cuban agriculture, even introducing pests and diseases into various crops”.

There is nothing to say about these falsehoods. Arguments of this type topple under their own weight and confirm the root of the hatred that communism exudes against those it considers its enemies, and it does not accept differing positions. The reality of this story is that the main victim of the agrarian reform was the small Cuban farmer, the people in general, and what happened is that those agrarian entrepreneurs whose properties were confiscated on the Island were able, in some cases, to rebuild their lives and achieve success for their projects in other countries.

To complete the operation of control of the agricultural sector, two years later the revolution allowed the creation of ANAP, the National Association of Small Farmers, on another May 17 —in this case, grouping the farmers in an organization penetrated and directed by the Communist party to impose its thesis on the sector. ANAP is not a business organization; it does not defend the economic interests of its members and is a mere instrument for transferring power from the state to the producers.

Some 64 years after the enactment of the law, what can be said about the Cuban agricultural sector?

The state continues to be the absolute owner of the land, which is also recognized in the Communist Constitution of 2019. Its percentage has grown to around 80%, but through the lease formula it has transferred the management of production to the farmers — who have, if this is possible, more problems than ever in achieving better harvests and more productivity. The lands that continue to be in the hands of the state are idle, without the Communist organizations ceding them to the private sector. On the other hand, these producers lack incentives to work and improve what they know will never be theirs. The conflict in the legal framework hangs like a sword of Damocles over the Cuban countryside.

There is abundant labor in the agricultural sector, much more than in other sectors of the economy. Almost a fifth of the employed population works in the countryside, and although statistical data are unavailable, it is an aging population, geographically dispersed, with low mobility, and with increasing levels of dependency and vulnerability. This concentration of the working population means that the productivity of the agricultural sector barely reaches 10% of the average for the entire economy.

The agricultural trade balance continues to show a deficit and it is necessary to import two billion dollars annually in agricultural products that are not obtained on the Island and that are necessary to avoid systemic famines. There is no product capable of obtaining income from exports, except for tobacco, which maintains its figures. Sugar, the emblem of the Cuban agricultural sector, disappeared after the reforms introduced by Fidel Castro at the beginning of this century, and currently the harvests, around half a million tons, are even lower than in colonial times.

The regime’s recent experiments to reactivate the sector, such as the 63 measures or the 93 measures, do not yield results because they are superficial and do not address the structural problems that must be tackled. They provoke price increases, a galloping inflation of the “Food” component of the Consumer Price Index above the average, and a real impoverishment of Cubans in relation to the dwindling shopping basket.

The agricultural sector is not an exception to the rest of the economy, but suffers from the same problems as other economic activities, because the regime’s model is not capable of finding formulas for improvement and prosperity that pass, above all, through the legal framework of property rights.

The limits to the development of agriculture in Cuba do not come from outside, but are found in the internal structure of the economic model that has created all kinds of pitfalls and shortcomings that have limited the efficient development of an essential sector for the welfare of the entire population.

In reality, 64 years later, Cuban farmers have very little for which to thank the Revolution’s agrarian reform. Reversing this scenario is possible and necessary. They already did it in Vietnam with the Doi Moi land ownership reforms that actually transferred property rights to the farmers. In just five years, Vietnam went from suffering famines to becoming a grain exporting power in Asia. It even makes periodic donations to impoverished Cuban agriculture.

The true meaning of the agrarian reform that Cuba needs will force a change in the Communist constitution. The regime itself wanted to block the necessary reforms, but it has no alternative. The Communist path is exhausted.

Translated By: Alicia Barraqué Ellison

Translator’s Notes:

* The Sierra Maestra mountain range was home to the rural guerrilla headquarters of Fidel Castro’s revolution in the 1950s.
** In Cuba, “guajiro” [wah-hee-roe] is a colloquial term for farmer.
*** The word caballería here means a unit of measurement in Latin America, equal to approximately 100 hectares.


COLLABORATE WITH OUR WORKThe 14ymedio team is committed to practicing serious journalism that reflects Cuba’s reality in all its depth. Thank you for joining us on this long journey. We invite you to continue supporting us by becoming a member of 14ymedio now. Together we can continue transforming journalism in Cuba.

Cuba’s Diaz-Canel Does Not Understand the Food Situation, Rather, He Sees It Backwards

Cuban farmers have been hit hard by lack of inputs and fuel shortages. (Flickr / Kuhnmi)

14ymedio bigger14ymedio, Elías Amor Bravo, Economist, 13 May 2023 — Perhaps someone could think that the script for the meetings the regime leaders are conducting throughout the Island could change at some point and gain a certain realism. An expectation that, unfortunately, hasn’t been met in Matanzas (nor in Mayabeque.) There, Cuban president Díaz-Canel once again repeated the mantra that food is a priority. Later, the state press referenced that message from the communist leader in relation to the increase in inflation for agricultural products. A serious issue that is at the origin of the social protests and growing separation between the people and the communist leaders, who didn’t even dare celebrate May 1st at the controversial Plaza of the Revolution.

Thus, if food is a priority and the main problem is food price inflation, what are they waiting for to take action? People are starting to get fed up with so many exchanges, that the state press describes as “sincere and profoundly critical”, during which, as previously in Artemisa, Sancti Spiritus, Villa Clara or Cienfuegos and Camagüey, they talked and talked about all sorts of things, many of them trivial, but they did not get to proposing concrete solutions to the problems. People get exasperated. And the worst of it is that, if there is a lack of trust in the county’s top leaders: Díaz-Canel, Marrero, Gil, etc., what they will gain is that people will begin to think the same of local and provincial leaders. They have been warned, they should prepare for the worst.

It’s the same old same old. The script has not shifted a single millimeter: the US ’criminal blockade’ is responsible for what happens, the party needs to perfect itself, power must be shifted to the territories and much remains to be done. A song, which surprisingly, is used later by the state press to attempt to gain some time in a critical economic scenario. The expectation now is that Minister Gil will offer real information on the economic situation during the next general assembly which has been scheduled with this topic as the order of the day. continue reading

As of now, what is not expected is for any delegate to demand explanations or responsibilities. It’s all the same, in no time the first semester of 2023 will be over, and in reality, the diagnosis will remain unknown for an economy that is in what economists describe as stagflation, a dangerous combination for its consequences — economic stagnation and inflation. The worst possible.

In the case of Matanzas, the provincial governor said that of the 264 agreements made last January, 195 have been met, showing management deficits. In Mayabeque they provided similar percentages of underperformance. The opposite could occur, that problems are not guaranteed to be resolved just by meeting the agreements.

Díaz-Canel says that much remains to be done, and the question is, what have the local communists been doing since January? The situation is grave in Matanzas where 16 companies report losses, a result that depends very much on the economic conditions created by Díaz-Canel.

They also spoke about the diminishing cattle mass and milk production, as well as not meeting the targets for fattening pigs and the slow pace, once again, of sugar production which will give way to another sugar harvest that is smaller than the previous year’s. A terrifying assessment of the situation that occurs in the rest of the provinces. The only highlight was the increase in exports of honey, charcoal and medical services. Incredible.

These meetings with Díaz-Canel, Marrero, and communist leaders with local regime representatives have placed food production at the center of the debates. As if the supply of agricultural products depended on decisions at the local level. The communists deny the existence in Cuba of agricultural holdings that benefit from large-scale operations, which allows them to achieve increasing yields, at lower unit costs.

They do not want that model because they prefer to maintain control of production so that consortia of economic power do not emerge able to escape from the ideological slogans. Thus, they want to take production to the local level, so that it occurs with small farms destined for small markets. A good example is milk, which sinks to state levels due to low farm yields, lack of motivation among ranchers, and the objective and contrasting fact that there is no milk to sell.

When paralysis strikes production, the only remedy is to review the production relationships. Even Marx would end up agreeing on this matter. If a system of production, any of them, is unable to feed the entire population and must resort to imports to cover food deficits, its design is distorted, inefficient, and should be replaced. The Cuban communists insist that the system continues functioning, and attempts to find solutions within the system, but that is impossible.

With regard to inflation, Díaz-Canel, who has been responsible, in large part, for the situation after the mistaken attempt to apply the so-called ordering task, should not say he was not warned. Prices increase in Cuba but not because people have more purchasing power and increasing demand. Prices rise because the supply is continually declining, for the reasons stated above.

And food prices rise more because agricultural production is at its lowest. Díaz-Canel is already delayed in beginning to solve problems and apply the correct decisions because the ones he’s applied until now have not yielded results. Precisely because they end up encouraging more and more reductions in supply, which must increase for prices to level off and begin to decline. Is it so difficult to understand the issue?

Díaz-Canel was worried he would not be capable of “ordering” prices, to avoid a surge in a “chain of intermediaries” because that is what, in his opinion, increases prices. He is mistaken; prices are currently rising and rising a lot, and not because intermediaries exist, which are outlawed by the communist regime. In Cuba, the only intermediary–the state through Acopio–is the one that creates these situations of food shortages in consumer markets. Díaz-Canel not only does not understand reality, but rather, he sees it backward.

Translated by: Silvia Suárez


COLLABORATE WITH OUR WORKThe 14ymedio team is committed to practicing serious journalism that reflects Cuba’s reality in all its depth. Thank you for joining us on this long journey. We invite you to continue supporting us by becoming a member of 14ymedio now. Together we can continue transforming journalism in Cuba.

Cuba’s Food Production Labyrinth: Heading Toward Failure

Cooperatives are one of the forms of agriculture in Cuba. (Bohemia)

14ymedio bigger14ymedio, Elías Amor Bravo, Economist, 9 May 2023 — Local food production is the latest experiment practiced by Cuban communists but it will be a failure. Like many others. The municipalities aren’t up to the task of producing enough food. The idea proposed — to shift state responsibilities to the local level for them to be managed by the territorial communist organizations — is a useless, inefficient exercise and far from improving the quality of life for people, will result in authentic chaos, exacerbating differences among Cubans according to the zone where they live, and many other things.

But Cuban President Díaz-Canel’s persistence in implementing structural changes and in managing and eliminating obstacles, so that municipalities develop these functions seems firm. And the state-run press does not pass up an opportunity to spotlight the gesture.

This is what occurred on Monday in Artemisa, where Díaz-Canel participated in a meeting to “evaluate achievement of the commitments made in January by this territory to overcome the complexities the nation is experiencing in the economic, social, and political-ideologic order.” A kind of ministerial review meeting that, since it will extend to the rest of the provinces, will keep the junta that runs the country occupied for quite a while.

And here comes the most notable result, when they realized that five months after a similar meeting was held in the province, during which they identified strategies to produce food in the area, “much remains to be done and there is great potential in several places that are not being used.”

Our position on this matter is clear. If, instead of focusing on creating and strengthening local production systems, they bet on the unity of the national market to take advantage of the production potential of increasing economies of scale, which ensures a superior efficiency of production processes, it would be another story. continue reading

Any first-year economics student would have corrected their “localist” initiative which is stifled by a phenomenon economists know well: diminishing returns. These occur precisely when the scale in which one factor operates, for example, the land, is not sufficient for the amount of work available. The obsession with producing in this manner creates inefficiency and “multiple potentialities,” as the state press note says, are lost.

But this local food production is another one of the communist congress’s conclusions, of those that when implemented end up damaging the Cuban economy. Remember what happened with the Ordering Task*, which also was imposed as a communist obligation. Putting ideology ahead of economic rationality is one of the most evident examples of failure in communist Cuba.

Wanting a municipality to become the fundamental entity responsible for food production is a mistake. Another is expecting food sovereignty goals to be met; as is believing that local authorities have the capacity to make decisions related to state companies located in their territories; and getting them to produce more is another inefficient idea.

Communists are adamant about these changes in structure and resource management because the central budget is at its limit and they need to transfer expenses to the territories where tax collection tends to be higher.  But they don’t realize that, by imposing this model, what they are really doing is transferring the inefficiencies and the communist central government’s poor functioning to the territories, which will end up imploding the system. Those responsible at the local level should confront the central government about this imposition which can only lead to chaos.

Moreso because the current economic conditions and the complex international scenario are not the most amenable to absurd experiments. It is bad enough to depend on imports, as happened with the communist centrally-planned economy; it is worse to try formulas so that each territory is capable of producing a good portion of the food consumed by its population. Small-scale does not work, it is inefficient and also not very profitable.

And we realize the absurdity of Díaz-Canel’s initiative when we see that what matters to him is to have a livestock census to achieve control over the masses; to facilitate the approval of foreign investment and good evaluations of food production projects funded by international donors; to join forces with the youth labor army to farm fields that are currently fallow; and to promote the development of areas within businesses or employers to produce food for their internal consumption. Bureaucratic and administrative work. When it comes to changing things, wouldn’t it be better and more correct if they restored property and land rights and facilitated a structural transformation of the Cuban economy to a free market economy?

For their part, local governments justify to Díaz-Canel their failure to meet targets  by claiming: “too much subjectivity and lack of awareness when applying the food sovereignty and nutrition education law,” and the lack of “training that includes all those implicated in the implementation.” Another good example of the improvisation that goes along with the regime’s application of ideological measures.

No one dares to say, publicly, that it is an absurd idea best tucked away in a drawer. There is not a single opposing position that defends a thesis like the ones proposed here. Everyone knows that the formula is useless, but everyone moves forward, united, toward the disaster. And for that reason, the most curious thing is that they devote themselves to counting “commitments” and there is someone who congratulates themselves when they state that of the 111 general commitments made during the previous meeting 72 have been met to date, 24 have not been met, and 21 could possibly be met. What do you think of that? Counting nonsense and meanwhile, the people experience deprivation, scarcity, and out-of-control price increases.

And clearly, it’s time to review this year’s targets and it’s like turning off the lights and saying goodbye. A wide spectrum of unmet targets weighs on the local managers and exempts Díaz-Canel and his people.

No matter, the thing is that Cubans continue experiencing hunger. They reported that the production targets will not be met for meat and sugar, nor will the targets for international tourists in the territory. They highlighted that they surpassed the targets set for exported services, but not goods; even though they did not delay making the fallow lands available — 14,000 hectares in eight months — producers are still not satisfied with the pace at which this process is carried out. That is, leasers request more land and the communists do not make it available. And this is in Artemisa, which is productive.

The meeting went down another path, subsequently turning its attention to the programs prioritized as demographic dynamics, the Life Task, and the production of local construction materials. They reported that in six months more than 600 jobs were created, in the government and non-government sectors; and they said that they continued to repair health and education institutions, and that 141 new slots were created in pre-schools.

Generally, in the province they worked to implement the strategic lines of action in the national plan for economic and social development 2030. They also highlighted a lack of training among party cadres to confront the complexities that lie ahead. They also talked about integrating all forms of production at the municipal level; promoting greater agility in the procedures that must be followed in order to export goods; and the importance of making better use of science and innovation. About the population’s dissatisfaction, those at the meeting only talked about “the revolutionary dissatisfaction with what we do every day.”

*Translator’s note: The “Ordering Task” [Tarea Ordenamiento] is a collection of measures that include eliminating the Cuban Convertible Peso (CUC), leaving the Cuban peso as the only national currency, raising prices, raising salaries (but not as much as prices), opening stores that take payment only in hard currency which must be in the form of specially issued pre-paid debit cards, and a broad range of other measures targeted to different elements of the Cuban economy. 

Translated by: Silvia Suárez


COLLABORATE WITH OUR WORKThe 14ymedio team is committed to practicing serious journalism that reflects Cuba’s reality in all its depth. Thank you for joining us on this long journey. We invite you to continue supporting us by becoming a member of 14ymedio now. Together we can continue transforming journalism in Cuba.

The Cuban Tourism Festival, Who Pays for it?

Women dress up in costume to earn a few convertible pesos from the foreign tourists in the historic center of the city.

14ymedio bigger14ymedio, Elías Amor Bravo, Economist, 1 May 2023 — This blog will directly monitor the regime’s tourism policy to detect its inconsistencies and errors, and before the FITCuba tourism festival begins, we already have a good example. The communist state press is flattering and describes as a success that “almost 400 Spanish tour operators are going to attend FITCuba.”

When it comes to inviting friends and paying for meals and hotels, it’s already known that the Cuban communist regime does not skimp on expenses. In the 60s, 70s and 80s of the last century, delegations of foreign communist parties came to admire the constructions of Cuban socialism. Fidel Castro hoped that they would speak well of his regime when they returned to their countries. It was the solidarity that Cuba needed to gain more followers in order to penetrate the leftist and revolutionary movements around the world. You know this already.

And now the tour operators hope for travelers and income. If almost 400 Spanish tour operators travel to the tourism fair, how many Spanish tourists arrived in Cuba in the best years of tourism before the pandemic? Sixty, 70, 80 thousand, could be more. What does it matter? The figure places the Spaniards in fourth or fifth place in the ranking of origin of tourism that reaches the Island. Ahead are Canada and the United States, even Russia in its favorable years. Since before the pandemic, Spanish tourism to Cuba had dropped many places in the ranking. The Spaniards traveled to different destinations and did not repeat the Island, unlike other destinations. The image of Cuba was perhaps blurred.

But it doesn’t matter. The state press celebrates that Barajas airport in Madrid seemed “a hotbed with the presence of 389 Spanish travel agents, who will take part in a convention and in the Cuba Tourism Fair,” many of them, tour operators, DIT Gestión de España associates, on an Iberojet flight. continue reading

What has happened to Spanish tourism to Cuba to end up being one of the least relevant? One of the Spanish representatives of a travel agency said that he has not visited the largest island in the Caribbean for 20 years, and now he hopes to see its “infrastructure, hotels and other facilities.”

Twenty years without traveling to Cuba. That is, the last time he was on the Island was at the beginning of the century when the Island began to emerge from the Special Period and Fidel Castro was sending to re-education camps the prostitutes and others who offered their services to Spanish tourists, mainly single men, according to statistics on the sociodemographic profile of those travelers. The fun was over, the commander arrived with the oil from Venezuela, Spanish tourism plummeted, and the figures were not repeated.

These Spaniards who now travel to the Island invited by the regime were practically children at the beginning of this century, and in these 20 years they have been able to travel to countless destinations of a much higher level of quality and competitiveness. Therefore, they are going to observe what is on the Island, and many of them are going to be surprised, but not for the better. The great opportunity to promote the Caribbean nation, which the communist regime expects from the expenses, will fall apart, because the leaders of Cuban tourism cannot think that in 2023 they can attract demand for tourism with a similar supply, in quantity and quality, to what there was in 2000.

And, of course, with much less “fun” despite the fact that Spanish travel agents are going to enjoy the paradisiacal environment of Cayo Santa María. I hope that the farmers with supply contracts have obtained sufficient quantities of products for them to enjoy the hotel buffet and breakfast. Sometimes there isn’t enough food.

That the authorities have planned tours of Havana for these travelers says a lot about their age and the number of times they have visited the Island: zero. We will see what they think of the streets without water or electricity, the semi-destroyed buildings, the lines of hunger or the lack of gasoline. Oh no, of course, that tour is not planned.

A recommendation: it would be good for these travel agents to take a walk by themselves to know the true reality to which they are going to send tourists. It does not seem that this idea is in the plans of the regime’s partner, the DIT Gestión group, located in Guipúzcoa, which hopes to achieve business once the action of the fair is over. The question is, why can’t that business be done by a private Cuban company, and should it be left in the hands of foreigners?

In the midst of all these trappings, the state press reported that the tourist company TUI Spain has launched a promotional campaign called “Two Weeks in Cuba,” which will be active until May 7, or that the firm TUI AG, from Germany, has more than 2,300 places with guaranteed departures from May to October to the Caribbean island. It was also said that from this coming June the connections between Spain and Cuba will increase depending on tourism, with the new air route of Enjoy Travel Group/Enjoy Barcelona-Havana.

All this is very nice and with great expectations, but the goal of the plan for 2023 of 3.5 million tourists is not going to be achieved.  Tourism to Cuba comes mainly from Canada. It’s almost 65% of the total. Have you heard anything about Canada at this Havana fair? No. Why does the regime disdain and not pay attention to tourism from the main market? Are they that confident about it? The regime’s tourism policy is an absolute failure, and in addition, these glories end up being paid for by Cubans. The same ones that tourists are going to see, if they manage to escape from their controllers, standing in the lines of hunger.

Translated by Regina Anavy


COLLABORATE WITH OUR WORKThe 14ymedio team is committed to practicing serious journalism that reflects Cuba’s reality in all its depth. Thank you for joining us on this long journey. We invite you to continue supporting us by becoming a member of 14ymedio now. Together we can continue transforming journalism in Cuba.

Cuba: A Return to the Special Period

A “makeshift” bus in Cuba; here a cart pulled by a tractor earlier in the century. (MJ Porter)

14ymedio bigger14ymedio, Elías Amor Bravo, Economist, 27 April 2023 — When the Soviet empire fell, after the toppling of the Berlin Wall by Germans who wanted to live in freedom, the regime in Havana was left a political and ideological orphan. Fidel Castro did not allow his arm to be twisted. Applying measures during the “Special Period in Times of Peace” he aimed to avoid the bitter pill and forced Cubans to go through all kinds of hardships. At the time, transportation was one of the sectors which fared the worst, when the Russian petroleum “supplies” failed to arrive. Like now, more or less. Already at that time, Cuba didn’t have access to global petroleum markets due to its accumulated debt. History repeats itself.

The regime blames the situation on technical problems of one of the suppliers, ships that do not arrive, or the embargo, but all that makes little sense when the main reason is its failure to pay debts that prevents it from accessing global petroleum markets, just as any other country. In fact, there is not currently a fuel shortage in any country in the world, and that is because the price of petroleum is falling. Only in Cuba is there a shortage of fuel (and food, electricity, everything.) Force them to see it.

Some things become daily realities for Cubans. During the Special Period, they ordered a series of measures to be applied to transport passengers when faced with fuel shortages; private trucks, animal-drawn carts or any kind of state vehicle were once again forced to transport people along the main routes, no matter the conditions. The movie, “Guantanamera” offered images of that time, which seemingly will become the reality once again.

The regime, faced with the lack of fuel which prevents the May 1st celebration in Havana, has approved Resolution 435 which forces drivers to pick up passengers, regardless of whether or not there are inspectors at the stop. As of now, passengers will be picked up by any mode of transport, along the busiest routes, with a priority at peak times, determined by the accumulation of people at the stops and the level of mobility. An alarming situation for difficult times. And the people, just like during the Special Period, pay the worst of it all with major sacrifices.

The state press has announced that the measures are being urgently applied in the capital and in Las Tunas, very densely populated areas, and that, little by little, they will be expanded throughout the rest of the country.

It’s easy to remember how the communists interfered in their transportation demands during the “Special Period”. Stationed in certain areas of the country, especially the busiest ones, agents of the party and state security who participated in the operation would detain any mode of transport of the few that passed on the roads and would begin an exhaustive check to know from where they came, what they were transporting, where they were going, etc. The point was to investigate and control. continue reading

Well, the communists have already provided a similar system in 2023 and according to the state press, in the early morning, the checks began, and anything could come of them. There is much talk about the need for solidarity, and the participation of all those who can, in one way or another, contribute to alleviate the situation.

But in reality, according to the media, the act of inspection and control of Resolution 435 emerged with extraordinary speed. They insist it is based on “objective planning, with the resources we have in hand, so that no destination is vulnerable and we will meet every afternoon, once again, to assess the implementation of each entity at this crucial moment of fuel scarcity.”

The regime’s behavior aims, just as during the Special Period, for private trucks to travel on the routes of highest demand and that drivers of motorbike-taxis to collaborate on the urban circuit. There are doubts about whether tourists will need to take any citizen in their cars.

These control actions are accompanied by measures to make oil more available to those who contribute to the travel network. There are doubts about whether a truck that arrives in Havana with an empty tank at a time the gas stations are not in service will need to interrupt its activity, for all its collaborating.

Currently, business units served by the Ómnibus Nacionales de Last Tunas continue their planned trips to Havana, Camagüey, Santiago de Cuba, Matanzas and Holguín and on the evening of Wednesday, April 19, there was an extra route toward the country’s capital, but the lack of fuel will imminently affect these services.

To the lack of gasoline and fuel, which is what affects the transportation sector, one must add the lack of spare parts, tires, and batteries, supplies that are in short supply and necessary for the rehabilitation of the vehicle fleet and its updating. The transport crisis, due to its cross-cutting nature, will affect to a greater extent all sectors of the economy and, above all, the living conditions of the population. None of this is good for the GDP of 2023, it will have to be taken into account for the calculation.

Under the exceptional circumstances, many Cubans ask if the official vehicles in which Díaz-Canel, Marrero, or Gil travel will be detained and inspected for them to transport other people to their destinations. I doubt it will be that way. In the film “Guantanamera” they managed to transport a dead man in different vehicles through provinces of the country. The communists have ideas of a similar nature.

Translated by: Silvia Suárez


COLLABORATE WITH OUR WORKThe 14ymedio team is committed to practicing serious journalism that reflects Cuba’s reality in all its depth. Thank you for joining us on this long journey. We invite you to continue supporting us by becoming a member of 14ymedio now. Together we can continue transforming journalism in Cuba.

Cuba’s Comptroller’s Office: From Administrative Control to Popular Control

The Controller General of the Republic, Gladys Bejerano Portela. (Networks)

14ymedio bigger 14ymedio, Elías Amor Bravo, Economist, 27 April 2023 — Cuba president Díaz-Canel’s intense agenda didn’t prevent him from holding a review meeting with controllers and auditors, and in particular with Señora Gladys Bejarano, once a star of the firmament of the Cuban communist economy, and now perhaps, at her lowest hour. Sra. Bejarano is the head of the Office of the Comptroller General of the Republic and the National Audit System, the main instrument of the regime in the “fight against corruption” of the many that exist.

At the meeting, Díaz-Canel highlighted “the accompaniment and support they have given to the direction of the country in all the tasks that have been proposed” and thanked “the effort, dedication, responsibility and commitment; proposing new things, how to get ahead, how to find solutions to our problems” to the managers, specialists and young people of that organization and to the audit areas of ministries, national entities, companies, local bodies of the People’s Power and other branches that participated in the event.

For Díaz-Canel it is important that the Comptroller’s Office seek for each measure approved by the regime “an interpretation of how to control the implementation of those measures so that they take effect.” But shouldn’t this task be carried out by the one who proposes the measure, that is, the government? Or is it that the basic principles of good governance are ignored by the leaders of the regime? It is not strange that, measure after measure, they all fail. This is a good example.

Next, Mrs. Bejerano gave a report on the challenges and projections for the performance of the entity she presides over in this exercise, presenting a mixed bag, very much in her style. continue reading

First of all, she wants to stop the loss of staff in the system. Controllers are leaving for the United States, Europe and Latin America. She knows that their experience and qualifications can help them get work as auditors in consultancies where they can earn six figures a year and not suffer the deprivations of communism. No wonder Mrs. Bejarano complains of a diminishing workforce.

Secondly, she called for the promotion of a culture of prevention and control in administrations and increased rigor in confronting manifestations of indiscipline, illegality and corruption in the field of administrative management. She offered to be at the head of the repressive mobs that communists like so much. It seems the Comptroller’s Office should exist for something else.

Third, she asked to update and optimize the self-control routes of the administrations and reduce the aspects that have to be checked. That is, work less for your organization, and if possible, look the other way if problems appear that can create some difficulty for the hierarchy. No. That’s not how you should play.

Fourth, she mentioned the realization of the next National Check of Internal Control, which evaluates the economic results; the quality of prevention and control actions; and the increase in speed in the processing and response to complaints and requests of the population, among other objectives. The truth is that little is known about those annual checks. It would not be a bad thing if the results of the work were disclosed.

Díaz-Canel, very much in his role, said he met young people in all the provinces willing to work in the Comptroller’s Office. In fact the UJC [Young Communist League] was present at the event and once again extended itself in its successful “innovative capacity, from the concept of creative resistance” to apply it to the daily task of the auditors. Díaz-Canel knows little about audit work.

At the close of the meeting, Díaz-Canel pointed out the high ideological training of those who make up the Office of the Comptroller General of the Republic and the National Audit System. Maybe that’s why they have difficulty retaining professionals who are fed up with so much ideology. He spoke about the negative consequences of the ’blockade’, which in his opinion has generated a context conducive to the increase of social indiscipline, illegalities, crime and corruption.

And he added, “in the face of imperialist logic, let’s impose socialist logic” supported by creative resistance, the completion of tasks and making it happen by the participation and dialogue of the workers. When it seemed that he was saying goodbye, he resorted, as it could not be otherwise, to the subject of his doctoral thesis, the paradigm of government based on science and innovation, social communication, computerization and digital transformation, which he asked to be applied to the activity of the Comptroller’s Office. And all this, without forgetting the “battle against corruption, against simulation, against shamelessness, and against double standards,” putting “socialist morality and honest and creative work first.”

A radical speech, of angry positions, far from reality and which  shows the enormous weaknesses of Díaz-Canel and the model he tries to defend at any price. The obsession with confronting corruption is greater than the corruption itself that has been installed in society, which, as we have highlighted in this blog, has a lot to do with the apparatus of administrative and legal rules of the Cuban communist system. Now Díaz-Canel not only wants to apply it to the Comptroller’s Office but also to popular control, and thus he announced that “people are needed to control and make the processes more transparent.” Hold on, curves are coming.

Translated by Regina Anavy


COLLABORATE WITH OUR WORKThe 14ymedio team is committed to practicing serious journalism that reflects Cuba’s reality in all its depth. Thank you for joining us on this long journey. We invite you to continue supporting us by becoming a member of 14ymedio now. Together we can continue transforming journalism in Cuba.

Will the Doors of the Cuban Financial System Be Opened to International Banking Like Tourism?

Long lines outside a bank branch Infanta Street in Havana. (14ymedio)

14ymedio bigger14ymedio, Elías Amor Bravo, Economist, 23 April 2023 — Really, now nothing is understandable at all. Marrero says that the Cuban financial system “must play a more prominent role.” Maybe he didn’t mean to say that, or most likely he ignores what he’s saying. It seems unbelievable that the communists are now demanding that their banks earn money.

Yes, you heard right. Speculation in the banking business is the new slogan of the regime. Banks must earn money at the expense of their customers. The ban was lifted to accumulate wealth in these entities that belong to the state. This is more or less what can be concluded from an amazing assessment meeting of Marrero with Gil, Vázquez, the president of the BCC and people from the provinces.

The communists don’t hold back in the slightest. Marrero says that “we need more accompaniment from the Central Bank of Cuba (BCC), our great advisor, to make more proposals in order to make timely decisions.” It seems that Marrero has forgotten what role the Central Bank has within the economic system, which is to contribute to the stability of the currency through monetary policy.

Now it’s not like that. They need to make money anyway they can, and if it means facilitating Cuba’s access to the international financial and banking system, so much the better. Foreign banks in Cuba? Why not? Which ones? That’s something else. The memory of Cuban communist leaders is so short that they sometimes surprise us. Does Marrero really think that the BCC will help him access international funding? Don’t they remember the 94-page judgment of the London judge?

The Cuban financial system cannot prosper by itself, because it depends on the decisions of Marrero, Gil and Vázquez, who do not understand banking or finance. Therefore, the system is inefficient and works at the service of political imperatives such as palming off sovereign bonds to finance the public deficit. Its role is merely that of a conveyer belt for state security orders, with no effectiveness. continue reading

The financial crises that have shaken the world in recent years have not directly affected Cubans because their banking system is so primitive and so isolated from the world that it barely penetrated. Banking in Cuba, Gil’s great goal, is one of the lowest in the world. Cubans don’t trust their banks, with good reason. Most transactions in Cuban pesos (which represent 70% of the commercial circulation) are made in cash.

And what about the challenges of the BCC right now? Of course, they have no relation to what Marrero said in his speech. Neither is there a need for “a comprehensive analysis that allows us to face the phenomenon of the lack of cash that occurs in several territories of the country,” nor “the review of plans or measures that can truly generate foreign exchange income for the nation.”

If Marrero wants to direct the BCC, he has to bet on his international credibility and ensure that the international financial markets take it into consideration. I insist, reading the ruling of the London judge offers ideas of where to go.

Marrero said something related to “working with respect to the foreign debt situation; rethinking the financial bases of foreign investment in the country; and taking forceful steps in the quality and organization of the national payment system, banking, financial education and computerization.” These terms seems interesting but in the long run will not lead to anything concrete.

The solution to the debt is to pay, reduce the internal spending of the state where possible and stop adventures. Be responsible and pay the arrears. Catch up, like any neighborhood debtor. And as much as it hurts, forget about Fidel Castro’s outcry about non-payment of international debt and try to make everyone see that Cuba pays, and that those crazy ideas will no longer be repeated. They must return to the fold. There is no alternative for the communist regime.

And then, of course, Marrero spoke of the eternal improvement of the banking system, which now wants to accelerate with the paradigm of science and innovation of Diaz Canel’s doctoral thesis, which is now essential, while trying to justify the measures of the foreign exchange market saying that they were going in the right direction, but that the measures have not worked. So, they don’t work, we’ll say. In banking matters, there is little to investigate. Ask any of the economists who provide their services at the BCC.

At the meeting, other topics were reviewed, such as cybersecurity, the human capital that is present in all sectoral assessment meetings, and working conditions and credit facilities for new economic actors. Marrero asked for the prevention of financial crimes, with the priority being money laundering, and to increase compliance with the control measures and procedures established in the banking system. These messages are for the international gallery and can only be useful if the appropriate measures are taken in financial operations. It’s one thing to say and quite another to do.

He also demanded that “quality has to reign in the banking system facing the population,” undoubtedly forgetting the clearly-visible lines at some banks to carry out currency exchange operations or the terrible functioning of ATMs, which forces customers to travel miles to find one.  He only briefly referred at the end of his speech to what “recently happen in London as an issue that must be treated and reflected on with a self-critical attitude.” We’re dying to hear more.

The management report of the BCC in 2022, presented by its president (who was not in office during that year), said that in a hostile and complex scenario, the national banking and financial system “maintained the vitality of essential services, actively participating in the Economic and Social Strategy, with a group of actions to design and implement mechanisms to advance the recovery of the economy.” We would have to know what those actions are, because the economy, far from improving, has gotten worse.

And he added in this regard that “the indications related to government measures adopted to increase food production, agricultural development banking, the direct marketing of productive forms and the development of investments were complied with.” It’s no use obeying the government if the same problems continue. The central banks are not here to devote themselves to this kind of thing.

He recognized that the quality of the service provided by the BCC does not yet show the results that society requires, and from here we wonder to which sector of society the BCC directs its services. He also pointed out that the main problems were identified as “the increase in the number of operations that do not correspond to the technological infrastructure and the current labor force; customer dissatisfaction due to delays in services; non-conformity with banking procedures that do not conform to current requirements; inadequate treatment; uncovered demand for cash in Cuban pesos and foreign currency; and inefficiency.” So it’s more of the same as always, and with all that, they want Cubans to put their money in the banks. Good luck.

The president of the BCC also referred to the implementation, as of August 4, 2022, of the mechanism of access to foreign exchange for the population, associated with the development of the foreign exchange market, a measure that he described as “a challenge for the system from the operational point of view and for the very distortions that its implementation has presented.” He must know what he is talking about; he comes from the CADECAS, the state currency exchanges.

In fact, when referring to the distortions, he pointed out that “one of them is the persistence of monetary imbalances that have generated a substantial increase in the amount of money in national currency in the economy, with high accumulation outside the banks, which exerts enormous pressure on the demand for currencies that cannot be satisfied with the supply available in the market at the current exchange rate.”

Monetary imbalances have their origin in the irresponsible and bulky public deficit that the president of the BCC did not have the courage to mention. Here you can see his lack of independence from the BCC, one of the issues that undermines the international credibility of the Cuban communist economy.

And then, as a final instruction, the president of the BCC announced that in 2023, “it is up to the Bank to institutionally redesign the banking and financial system, adjusting it to the current requirements of the economy for its better functioning,” and he announced “other work priorities such as the development of financial intelligence activity; the design of a comprehensive strategy for the reorganization of the Cuban debt; the creation of the public debt market; the strengthening of the foreign exchange market; the improvement of the liquidity allocation system in conjunction with the Ministry of Economy and Planning; and the rescue of the cash coverage necessary for the proper functioning of the banking system and the economy.”

Undoubtedly, duties accumulate, although the most important thing  — implementing a serious and credible monetary policy — is left aside. And the most alarming of all this is the reference to the “institutional redesign of the system,” a proposal that is very cryptic and that could well mean something else, such as the entry of foreign private banks to operate with the state banks, following a model similar to the hotel sector. In for a penny, in for a pound.

Translated by Regina Anavy


COLLABORATE WITH OUR WORKThe 14ymedio team is committed to practicing serious journalism that reflects Cuba’s reality in all its depth. Thank you for joining us on this long journey. We invite you to continue supporting us by becoming a member of 14ymedio now. Together we can continue transforming journalism in Cuba.

Cuba: There’s No More Fuel, and Now What Do We Do?

In Cuba, long lines of vehicles are waiting their turn in the service stations all over the country. (14ymedio)

14ymedio bigger14ymedio, Elías Amor Bravo, Economist, 19 April 2023 — An activity as simple in other countries as arriving in a vehicle to a gas station and filling the tank has become another headache for Cubans who have the privilege of access to cars or any other means of transport. It is no longer just the absence of food in the bodegas or the power outages that paralyze  activity. Now it’s the scarcity of gasoline and diesel, and the situation has been going on for a long time.

The minister responsible for the chaos, who is the head of Energy and Mines, Vicente de la O Levy, blames the fuel suppliers who “have not been able to comply with the commitments they had with Cuba because of the economic and energy situation in the world. In addition, there are problems with the supplies needed to produce it.” And the truth is that neither of these excuses is true.

Cubans should know that the current economic situation worldwide is not causing deficiencies in fuel supplies in any country in the world. There is no global energy crisis now that the markets have normalized after Díaz-Canel’s friend invaded Ukraine, and this argument doesn’t make sense. Neither does the unreal image of a blockade of oil tankers that want to reach the Island.

All that is false and an insult to people’s intelligence. In reality, countries are intact and have even increased their oil reserves so as not to lack black gold and meet the growing needs of the post-pandemic. At the same time, there has been a notable acceleration of investments in renewable energies to reduce dependence on oil.

The lack of fuel and unstable supplies are a consequence of the Cuban regime’s behavior, especially its policy of not paying its debts. The 94-page judgment of Judge Cockerrill in London made it clear that Cuba doesn’t pay what it owes and that there will be consequences. One of them is the lack of fuel. To be able to buy oil in world markets at international prices, a country must to be up to date on its debt and have a normal payment schedule. Neither of these conditions is met by the Island. continue reading

International prices are unaffordable for the regime as a result of the shortage of foreign exchange caused by economic activities that do not generate the necessary currencies to formalize these purchases. Commercial credit is unfeasible, and even more so after the judgment of the London trial. Therefore, the regime resorts to donations or barter at subsidized prices, which are practices that, at the moment, cannot be assumed by the main producers, even by friends like Venezuela, which is positioned on world markets to take advantage of the favorable situation. Other producers, such as Algeria or Libya, look the other way.

In spite of all this, the Cuban communists have not been able to foresee a scenario that had been perceptible for months. All governments assume the preparation of a secure technical oil reserve, which could last between three and six months to face specific crises. The competent ministry is responsible for these actions. In the Cuban case, it is easier to blame others than to take responsibility. And that’s why the minister announces what the communists have practiced for more than six decades: the rationing of gasoline and diesel, with the now-known results of lines at gas stations, desperation and loss with downtime for workers. A disaster and chaos.

In addition, the minister assumes that an eventual improvement in supplies in the short term does not mean that the levels of the past will be recovered, but that we must prepare for the worst, because the fuel shortage will not be easily resolved. And the solution is to take out the little fuel that remains in a partially reduced way so as not to stay at zero, but with the known negative effects for the population in essential services like transport. As in the ‘Special Period’ in the 1990s after the collapse of the Soviet Union, “alternative” animal-powered vehicles may return to the streets, although some Cubans are pessimistic about this. There is also no food for the horses, so they lack energy.

So, while the minister of the branch and other leaders spend their time blaming the U.S. ‘blockade’ [i.e. the embargo] for the fuel crisis, someone has to think about what to do. The margins are reduced because the main supplier of oil to Cuba, Venezuela, already began in the second half of 2019 to reduce shipments to the Island, and that was decisive enough for the Cuban economy to experience a recession in the same period, starting its free fall in 2020 and then in 2021. Without oil those countries that still maintain a high dependence on non-renewable energy are not able to produce, and the 8.3 million tons of fossil fuel that Cuba consumes each year jeopardizes its growth, since only 39% is obtained from national production.

The regime announces restrictions and the rationing of fuel amid diminished capacity; it is not known how long it will last. Domestic fuel will also falter in supply since, as the minister pointed out, “there is not enough,” while some provinces “are left with one day of reserve, others have two and the eastern region ran out of fuel in the Cupet tanks of our bases.” Yet they remain calm. The lack of domestic fuel will join the blackouts that have already been occurring for some time, and a perfect storm is approaching, which may end with a collapse of the system, ending the patience of all Cubans.

The authorities say that they have done the impossible to alleviate the situation and at all times have kept the population informed, but this is not true. On the one hand, by not paying debts on time, they are having these problems now. No one will say it and much less recognize it, but debts that have been unpaid for decades act like a sword of Damocles at the present time. The information reaches the population too late, and nothing can be done, and the  “sectoral and territorial priorities” established by the regime aggravate the people even more.

The scenario is not favorable. The weakened Cuban economy will be even more so with the lack of fuel, and the supply will be lower, which will increase prices and cause more inflation. The trickle of fuel, prioritizing certain activities and not others, can end up generating distortions in relative prices and even, in the extreme, in informal practices that can emerge if the situation continues over time, as all indicators confirm. It only occurs to the regime to increase surveillance, controls and repression by limiting the number of gas stations that will give “vital” services to the population and by limiting the amount of fuel to be marketed. It’s bad, and very difficult times are coming.

Translated by Regina Anavy


COLLABORATE WITH OUR WORKThe 14ymedio team is committed to practicing serious journalism that reflects Cuba’s reality in all its depth. Thank you for joining us on this long journey. We invite you to continue supporting us by becoming a member of 14ymedio now. Together we can continue transforming journalism in Cuba.

Will It Be Possible To Act Against the First Usurper of the Cuban Communist State?

For Sale or Trade. With today’s massive migration, many Cubans find great difficulty in selling their homes. From

14ymedio bigger14ymedio, Elías Amor Bravo, Economist,  3 April 2023 — The illegal occupation of homes and premises is a symptom that things are not going well in an economy. It is also a process that has been growing in Cuba in recent years, which has led communist leaders to get out of the collectivist and egalitarian script. Let’s see how.   After the triumph of the so-called revolution, when the most devastating action against private property rights in the world was perpetrated by a country, the usurpation of homes became commonplace in Cuba, encouraged by revolutionary leaders. Families who fled the country, leaving all their assets behind by the confiscatory actions and the political persecution unleashed by Castro terror, contemplated from a distance how their homes and premises were occupied by other people who had nothing to do with their family or heirs.

The illegal occupation became legal due to the de facto acceptance of the new regime. In other cases, the new leaders were “giving away” the homes left by their former owners to people for the mere fact of being faithful to the new political leadership of the country. Without records, notaries, or anything like that, there was a real usurpation of the old housing property in Cuba, first by the state and then by people who were never its owners. The phenomenon reached such a dimension that for many years the regime played with the false image of the threat that a massive return of exiles could pose for the precarious occupants of the homes that were not theirs.

The chaos caused in revolutionary times was maintained until the approval of the communist constitution of 2019, in which article 42 recognized the right of people to the protection of the home, establishing the prohibition of the entry of others without the authorization of the person who inhabits it, unless such entry was made by express order of the competent authority and with the formalities of the law.

Subsequently, Criminal Code Law No. 151 of 2022 was published, which introduced the crime of usurpation, provided for in article 421, to address the increase in housing occupation by some individuals or groups, who, taking advantage of the temporary absence of the owners or cohabitants, committed the crime. A phenomenon that seems to have grown exponentially in recent years, as a result of housing shortages, the deterioration of existing homes and the low incomes of the population, especially among vulnerable groups. The alarm has reached the regime, observing that not only supposedly private homes are occupied, but also state premises where services for the community are provided, such as medical offices, social housing and warehouses, among other properties that have been abandoned by government neglect. continue reading

In this way, the regime wants to face the crime of usurpation with an approach commensurate with its interests. For example, before the entry into force of the current penal code, only those who entered other people’s homes or premises through violence or intimidation were prosecuted for said crime. Not those who didn’t do it in that way. The housing officials and the commissions to confront the illegalities managed their extraction from those places after declaring them illegal occupants, which was interpreted as a softer and more comprehensive treatment toward practices that they now want to eliminate.

And why this change? Well, basically because of the spectacular increase that has been occurring in these occupation practices and, with it, the harmfulness and aggressiveness of behaviors in any modality, which requires an intervention of criminal law in the solution of these conflicts aimed at protecting property as a legal asset. Yes, everything is very correct, but the protection of what property? Of the property previously usurped by the same regime that governs the destinies of Cubans? No. It’s not something to celebrate. It’s unbelievable that this type of approach emanates from an economic system in which private property, although recognized, continues to have a marginal role in the economy as a whole, where the collectivist mentality prevails overwhelmingly.

Thus, the authorities understand that ensuring and strengthening the inviolability of the home, recognized in the constitution of the Republic, is an objective that is related to the current socioeconomic conditions in which Cuba operates, where private ownership of housing is still limited to a maximum of two. It would be good if this measure were applied to all kinds of interference in homes, such as those that state security maintains in the form of repression against dissidents, for example.

But the regime seems to be clear about what it wants and that’s why it gets straight to the point. Only in this way can the publication by the Governing Council of the Supreme People’s Court be interpreted, through Opinion No. 471, of February 15, 2023 (published in the Official Gazette of the Republic of Cuba, no. 17, extraordinary edition, of March 2, 2023) of judicial practice in the processing and solution of these matters. An extensive document that is worth reading in detail.

When the illegal occupation or seizure of a house takes place in Cuba, the authority, once the complaint has been formalized, will immediately inform the administrative bodies responsible for the  system of housing, territorial and urban planning, the community prevention bodies and the municipal administration councils, so that, together with the National Revolutionary Police, they adopt the measures to extract the illegal occupants, thus restoring, with identical immediacy, the broken legality.

We would have to ask ourselves at this point, what is the legality? The fiction created by Raúl Castro or the one before 1959 that continues to be documented in the historical property deeds of the Cuban economy? Remember that the law does not state which one, much less the law of property. The communists have gotten into a good mess, they alone. Will the historical owners of the homes be able to exercise this right of complaint or are they still excluded? Are the squatters the ones who were established without an acquisition or rental operation in the homes and premises confiscated by the revolution?

It is also stated that, against those who execute these illegal acts of seizure, the prosecutor’s office or the court will have one or more precautionary measures provided for in the law, which can be provisional imprisonment in cases where the property is not immediately abandoned, in order to avoid the continuity of the allegedly criminal conduct committed and the restitution of legality. The perpetrators of this crime can have penalties imposed that run from six months to two years, or a fine of 200 to 500 pesos, or both.

If the occupation is carried out with force, violence or intimidation, or the act was a consequence of gender or family violence, or for discriminatory reasons of any kind, the penalty increases from two to five years, or a fine of 500 to 1,000 in installments, or both. A similar procedure will apply when the occupation or empowerment takes place with premises belonging to state entities, and the administrative authorities, holders of these, are responsible for restoring legality, in conjunction with the other groups or institutions that are deemed relevant. What could happen when a holder of historical rights takes action against the state for the premises that have been confiscated and occupied since revolutionary times?

The rule states that criminal responsibility increases if the crime is committed against children under 18 years of age, people with a mental disorder or taking advantage of that situation, or the occurrence of a disaster, public calamity, or any other situation of that nature, or under the ingestion of alcoholic beverages, drugs or substances of similar effects.

When the occupant leaves the property voluntarily, without the need for the aforementioned administrative and preventive bodies to act, the court, at the time of adjusting the sanction, may assess the positive conduct of repentance and, consequently, apply a reduced penalty.

The court, in the execution phase of the sentence, if necessary, will be assisted by the administrative, preventive and police bodies, to extract the person who has illegally usurped a property, and will restore legality, returning it to its owner or legal possessor.

There is no doubt that the situation in Cuba must be very complicated for the regime, the authority, to try to face it with a procedure like this, which has nothing to envy compared to the one that is applied in privately owned market economies. The procedure described circumvents this legal right with ambiguous references to the inviolability of the home and uses dubious concepts, such as “owners or cohabitants.” There is no doubt that the owners of the property usurped by the regime can apply this procedure in defense of their rights. This is another issue that creates important gaps and inequalities in Cuban society. Some Cubans will be able to resort to the procedure in case of occupation or usurpation of their homes; others will continue without a recognition of their rights. In the Cuban communist regime, some things change, but, unfortunately, never in the right direction.

Translated by Regina Anavy


COLLABORATE WITH OUR WORK: The 14ymedio team is committed to practicing serious journalism that reflects Cuba’s reality in all its depth. Thank you for joining us on this long journey. We invite you to continue supporting us by becoming a member of 14ymedio now. Together we can continue transforming journalism in Cuba.

The First Effects of the London Trial’s Verdict on Cuba’s Debt

Headquarters of the Central Bank of Cuba. (Flickr/Maxence)

14ymedio bigger14ymedio, Elías Amor Bravo, Economist, 5 April 2023 — On January 23, a trial began in the British High Court of Justice for a debt claim of the CRF I Ltd. fund (plaintiff) against the National Bank of Cuba and the Republic of Cuba (defendants). A trial that, as expected, was not going to have a quick resolution, as finally happened on April 4, with the ruling of Judge Sara Cockerill, in charge of the trial. It took just over two months to arrive at a solid document of 94 pages, structured into 41 sections and some conclusions, and whose reading, loaded with legal technicalities as it could not be otherwise, comes to resolve, for the moment, the judicial matter related to a sovereign debt claim.

Rivers of ink have led to this conclusion of the trial, which is expected to become a precedent, and which is interpreted as a win by both parties.

For Cuba, because it will not have to face payment of the debt, at least for the moment. It is already established that CRF is not a creditor of the Cuban state but of the BNC, which means that the Republic of Cuba is out of the lawsuit. From now on, the trial will continue only against the BNC, which will have the right to establish the defense allowed by English law.

For CRF I, because it is not qualified as a “vulture fund,” and the court accepts its ownership of the debt and its status as a legitimate creditor, as well as the conditions under which the entire financial operation has been developed.

It could be assumed so far that everyone is happy and that Judge Cockerill’s decision is very Solomonic, but that’s not the case. Consulted legal experts, who are able to read the contents of the sentence with a much more professional look than an economist, can reach a series of conclusions that deserve attention. continue reading

The ruling, subject to appeal, leaves both parties without achieving their main objectives. CRF I finds it difficult to collect the claimed debt; hence, a director of the entity has already offered to begin negotiations with the regime. For Cuba, the sentence represents an international slap on the wrist for terrible public management of its debt policy and an anachronistic bureaucracy that transfers responsibility to employees to prevent the damage from reaching the top.

It is true that the judge does not investigate in depth the totalitarian roots of the communist regime, and this can make him lose perspective, but he did address economic and financial issues in a comprehensive way, even with that brief historical recourse to the background of the BNC in the times of Prío Socarrás [President of Cuba, 1948-1952].

No one should see in the ruling a document critical of the management of the regime prepared by the democratic opposition. It is a text of an independent judicial ruling that shows the complex mechanisms and bureaucratic tangle with which the Cuban communist regime attends to its financial affairs. First conclusion: it does not seem that the list of investors in Cuba is going to increase.

In addition to the breaches of the debt service, the algorithms of international analysts will be nourished by the information from this ruling, and the Havana regime, no matter how much its spokespeople say, is going to be demoted as a recipient of investments and loans.

The international image of terrible managers, corrupt practices and falsifying ownership of credit institutions to avoid lawsuits which derives from the ruling, should worry the regime, because it entails loss of credibility and trust and will make it even more difficult to access the international financial markets. The proximity to the closing off of credits is more than real. What will probably happen, since the parties have not achieved their objectives, is that they will appeal the ruling and prolong the trial.

In fact, a careful reading of the judgment guides the plaintiff (and many others) how to approach the claim to collect the debt, but the regime has some tranquility in the short term and is allowed to present the result as a triumph.

That is why I agree with my colleague Emilio Morales when he points out that in any judgment about the debt of the Cuban regime, the mechanism of transferring that debt from one entity to another has to be analyzed. That analysis is essential to “determine whether Havana’s assets are today in tax havens or in the hands of foreign entities that could be sued.” He adds, “the genesis of this conflict is to determine how they they were able to remove those assets from the BNC and transfer them to the BCC. There was an act of bad faith in the 90s when dividing the bank.” On these issues, Judge Cockerrill did not want to get involved.

And one last observation. The regime announced last January that the Superintendency of the Central Bank of Cuba, as a technical body with autonomy for the exercise of its functions assigned by the law related to the inspection, surveillance and control over the institutions that carry out financial and banking activity in the country, would be “in charge of reporting the results of the trial in a timely manner.” That has not happened. Instead, a Cuban television journalist has assumed that role.  Even in their statements they contradict each other. Our nerves are on edge.

Translation by Regina Anavy


COLLABORATE WITH OUR WORKThe 14ymedio team is committed to practicing serious journalism that reflects Cuba’s reality in all its depth. Thank you for joining us on this long journey. We invite you to continue supporting us by becoming a member of 14ymedio now. Together we can continue transforming journalism in Cuba.

What Can Happen With the Russian Economic Plans in Cuba?

Miguel Díaz-Canel was received by Vladimir Putin on his visit to Russia. (@DiazCanelB)

14ymedio bigger14ymedio, Elías Amor Bravo, Economist, 4 April 2023 — The Russians are not going to be the salvation of the Cuban economy. Not by a long shot. No one should expect magical solutions in all this. Because they don’t care whether Cubans live better, nor have they received that order from Cuban President Díaz-Canel. Let no one have any illusions. Little is known about the Russian plans for the Cuban economy, but a conclusion can be reached. They will not straighten out the state shipwreck that is the inefficient and inoperative Cuban economy. The Russians propose to make changes but without touching anything. Let’s see how they do it.

However, the script of what has to be done to get the Cuban economy out of the Marxist hole is known and written, and in general, there is a lot of consensus around it. Therefore, it is advisable to distrust the Russian plan proposed by Putin’s adviser, Boris Titov, as president of the council of the Center for Russian-Cuban Economic Transformation that was born with the approval of Díaz-Canel during his trip to that country. This council acts on the instructions of Putin in the first place, and Díaz-Canel, secondly. From these two partners, from the good and the bad, you can expect anything, except rationality and economic wisdom. Any Spanish, Argentinian or American consultant could have done better.

The idea, in the first place, is to end the strict control that the regime exercises over the currency exchange. Correct. The creation of a foreign exchange market in Cuba for the peso, transparent and efficient, like the one that exists in other countries of the world with their respective currencies, is a proposal that the communist regime neither likes nor is interested in. Díaz-Canel had it at his fingertips in the Ordering Task,* and it barely lasted two months. He doesn’t  like it because a fixed exchange rate can’t be sustained with the level of reserves of the economy. And it doesn’t interest him, basically, because for Cuban communists the foreign exchange market is nothing more than a means of collecting foreign currency for the state coffers that is not going to leave just because. continue reading

All the exchange decisions that are taken in Cuba, including the fixed exchange rate of the ordering task, go through arbitrating mechanisms for the spin of currencies that enter the country for the benefit of the state. The discrepancies between the official and the informal exchange rate prevent any possible solution to the problem of the loss of value of a currency, the fundamentals of which are in serious crisis. The regime does not like the alternative of a foreign exchange market and, therefore, will block this proposal of the Russians, even if they recognize the consequences of the disastrous exchange rate policy.

Secondly, the Russian plan proposes to Havana to empower and promote small and medium-sized enterprises, which in Cuba are known as SMEs, and which have already been criticized from different positions. Are the Russians thinking that Castro’s SMEs serve their reforms? I doubt it. They have proposed an in-depth reform of fiscal policy to bring out activities from the underground economy. As a theoretical approach it could work, but first you have to throw something away. In the Cuban economy, taxes are only a small part of what prevents the SMEs from prospering.

The main problem lies in the absolute interference that the communist regime maintains in the SMEs, which in Cuba must be authorized by the Ministry of Economy and Planning and violates the right to free enterprise that exists in market economies. The Ministry offers monthly data from authorized SMEs, but nowhere is there information on those that go out of business, and it is known that this type of project usually presents a high mortality in its early years. Without this data, it is impossible to determine the scope of the reform of SMEs and their economic and social impact. Presumably, the Russians have asked for the data. Meanwhile, the Cuban state maintains its absolute control over all strategic areas of the economy and corners the SMEs by limiting their possibilities for growth.

The SME sector and other private actors cannot lead any economic change because it only represents 7% of GDP, 11% of budget income and offers employment to a quarter of the country’s workers (1,600,000 according to data from the Ministry of Labor, compared to more than 3 million, double, employed by the state and its companies). The figures do not allow comparison: the private sector in other countries represents more than 80% of employment and in terms of GDP management it far exceeds 70%. The distance from Cuba with these international parameters indicates the intensity and complexity of the reforms to be undertaken.

Thirdly, the Russian plan aims to eliminate other obstacles faced by companies in Cuba, such as the difficulty in accessing credit, high taxes, problems with the rate of return due to the prices of some goods, which are established in a directive way by the regime, or the price of other goods, limited by low wages in the public sector.

In short, return the axis of the functioning of the economy to the private market. Correcting the aforementioned factors is not easy, especially since, in this case, it would not be fair to apply corrective measures only to private companies, when the state companies, which are the “center of the economic system” for the regime, will not receive the same treatment.

Fourthly, the Russian plan believes that making the tax regime more flexible can help the private sector get out of the underground economy and the vicious circle in which it finds itself, and produce results in the increase of the production of food and commodities. The proposal is to move slowly, but surely, in terms of reforms, to avoid what happened in Russia, where structural transformations caused notable social injustices.

The question is how to reconcile reforms in the functioning of the economy with the maintenance of social quotas served by a budget that, necessarily, has to be reduced in size to free up resources for the private sector. It is not a matter of shock therapies or anything like that, but if the state is intended to reduce its weight in activity by placing itself at levels similar to other countries, and central planning is to be replaced by the laws of supply and demand in the setting of prices, the population cannot be deceived: sacrifices will have to be accepted.

And those sacrifices will be the greater the more the structural decisions are delayed and the more they try to sustain the state budget with the current superfluous spending commitments that currently exist. There is no possible alternative, and it should be explained to the people that the adjustments are necessary to build a prosperous economy, capable of generating employment and wealth for all, far from the Stalinist collapse of six decades.

Fifth, the definitive farewell to collectivism must be accompanied by transparent privatization processes with international observers, to ensure the legality of the actions. But as far as we know, the Russian plan doesn’t say much about this. The redistribution of economic power that is associated with these processes should not lead to the creation of mafia groups or companies of the regime, which in reality already exist, but to the birth of efficient, flexible and competitive private companies that help in the reconstruction of the nation. If the Russians are not able to offer this solution, it’s better that they don’t do anything.

In reality, the experience of Cuban SMEs in the last year has little to do with the free enterprise of which the Russians speak. Of course, it is much better that there are SMEs than that there are none. But the regime has absolutely controlled the process of creation and approval, and despite everything, it has not been able to consolidate productive structures in the field of food, where unattended needs are still very prominent. There has been a commitment to the manufacturing industry and services, which have been consolidated in the first sectoral position.

There have also been complaints that some SMEs have been oriented to develop businesses that are in the hands of family and friends of senior officials, as well as foreign entrepreneurs related to the regime. But the truth is that, so far, you can’t talk about an economic class with defined objectives and purposes. The state maintains absolute control of the process, and the SME as an alternative to communist power is weak.

Within the framework of the projects that the Russians want to implement in Cuba, there has also been talk of a joint commercial company, based on foreign investment to distribute food, chemicals and other items with the participation of the Cimex group, although no contract has yet been signed, and it is already known how these things end. Another investment project, also to be developed, is a hotel for the exclusive use of Russians, justified by the return of tourism from this country to the Island. The authorities have denied this information.

Okay, then. Russia’s relations with other countries, including Cuba, are usually structured on a framework of obscurity and little transparency that, at times like the present, with the war in Ukraine and the international embargo, multiplies significantly. Geopolitics also has a very important influence. Russians are not Cubans, nor are Cubans Russians. It will be difficult to know exactly what the Russian plans consist of, but there is no doubt that they may be compromised by what happens in Russia in the immediate future. Most likely, they will amount to nothing.

*The Ordering Task is a collection of measures that include eliminating the Cuban Convertible Peso (CUC), leaving the Cuban peso as the only national currency, raising prices, raising salaries (but not as much as prices), opening stores that take payment only in hard currency, which must be in the form of specially issued pre-paid debit cards, and a broad range of other measures targeted to different elements of the Cuban economy. 

Translated by Regina Anavy


COLLABORATE WITH OUR WORKThe 14ymedio team is committed to practicing serious journalism that reflects Cuba’s reality in all its depth. Thank you for joining us on this long journey. We invite you to continue supporting us by becoming a member of 14ymedio now. Together we can continue transforming journalism in Cuba.

And Now, the Commodification of Cuban Music

“They achieved the miracle of turning Nicolás Guillén into another person,” an Internet user said echoing many others who claim the newly inaugurated sculpture looks nothing like the man.  (Art for Excellencies)

14ymedio bigger14ymedio, Elías Amor Bravo, Economist, 30 March 2023 — The Ministry of Culture (MINCULT) says that it is being “improved,” but don’t believe it. What it really wants is to be an agent for artists and musicians. Late post-castrism has hung the “For Sale” sign on the entire productive and obsolete apparatus of the Marxist-Leninist economy built over six decades. It is not a real and effective privatization, as perhaps would be desirable, but something worse and more opportunistic.

They have already started with the commodification of universities, which I discussed in my previous post, and now they continue with culture and music. And if in the first case the Ministry of Higher Education was the architect of stepping on the accelerator, now it is the turn of MINCULT, which, according to the state press, is “currently involved in the complex task of improving the business system of music, a process necessary to articulate the promotion and development of musical talents throughout the country.”

They say this “process” is necessary, but it has been non-existent for six decades, when Cuban musicians and performers were forced to live a miserable existence on the Island, seeing that their works reached value mainly abroad, where popularity led them, in many cases, to flee the country with the punishments that the regime later applied for deserting. And now, when the economy is in danger, the Castro leaders remember Santa Barbara, the saint of protection. They have to get money any way they can. What they get from doctors hired out to other countries and tourism, it’s not enough to reach the end of the month. That’s where the musicians come in. continue reading

This controlled peddling by the state experienced a significant acceleration in 2022, as recorded in MINCULT’s annual balance sheet meeting. After the pandemic, with the return to normality and in-person meetings, cultural activities increased. Not surprisingly, they served the regime to balance the figures of the economic growth of 2022, along with other state programs.

In this sense, according to MINCULT, celebrations such as the 120th anniversary of the birth of Nicolás Guillén and Wifredo Lam and the centennials of Haydee Santamaría, Carilda Oliver, Jesús Orta Ruiz and César Portillo de la Luz were accompanied by traditional events such as the Havana International Book Fair and the Jazz Plaza Festival, which reached high levels of participation thanks to a growing presence on social networks and digital platforms.

At the balance sheet meeting, more than 900,000 cultural activities were reported in the country, aimed at eight million spectators, including the plastic arts exhibitions that toured the Island, more than 300 record productions and dozens of concerts. Likewise, it was a year of intense exchange with international personalities and officials who visited the Island, from Mexico, Venezuela, Paraguay, Serbia, Benin, the United Arab Emirates, South Africa, Spain and France.

And of course, this deployment of activities that doesn’t seem to skimp on expenses that have to be paid has left a worrying mismatch in the accounts, recognized by the Ministry itself, and they point out that the territorial budget has been insufficient to design the cultural programming. They also complain about the lack of coordination with the Ministry of Education to make schools reference cultural centers in the community, and the poor conditions of houses of culture, cinemas and theaters have also appeared among the main problems.

All this causes a lack of money and, as a result, insufficient management of cultural heritage and historical memory. Despite the deployment of expenses and activities, 62 museums remain closed, and 77 monuments are threatened with deterioration. Local governments did not advance during the year in the search for funding and equipment to increase the number of interactive museums; technological deficiencies affected the digitization of documentary heritage; and inputs for the conservation and restoration of heritage assets were not enough. The panorama is not flattering.

Therefore, at the balance sheet meeting, it was considered urgent to solve these pending problems by increasing the necessary funds with the promotion of artistic creation and the culture-tourism relationship, which is considered important for the economy. In addition, actions were announced to promote cinematographic and audiovisual creation, a protocol to improve the conditions of conservation of documentary heritage, an increase in the realization of tours of groups and shows, and work to make film presentations in the communities. More spending, more money needs. Where are the funds going to come from?

It was then that the key moment arrived, when the Ministry of Culture announced that it is immersed in the complex task of improving the business system of music. What is this? Well, basically make money by selling Cuba’s musical talent. And for this, the Ministry, as if it were an agent of artists, will be tasked with the promotion and development of musicians throughout the country. State business is in sight.

Cuban music has a great international acceptance. Styles are changing and modernizing, but the ability of Cuban artists to reach mass audiences has always been there. There are great prospects of obtaining income that, applying the “improvements” by MINCULT, can end up in the state coffers but not fully benefit artists and performers. The regime’s decision has caused surprise, but not so much.

Those who include in their agenda such state issues as the strengthening of the National Program against Racism and Racial Discrimination have set as a priority for the Ministry in 2023 to increase foreign exchange income through the export of goods and services (the sale of artists and their productions) in the same way that has been done with other professionals, such as doctors, security agents and certain athletes.

MINCULT’s “improvement” or commodification of Cuban music by the state also involves promoting alliances with new economic actors and, in addition, encouraging foreign investment aimed at the substitution of imports and the expansion of markets, applying strategies that allow the self-financing of events. More doubtful is what can be achieved in this area, but the bet is made. That said, the Ministry of Culture has become an agent of artists and wants to earn money at any price.

Translated by Regina Anavy


COLLABORATE WITH OUR WORKThe 14ymedio team is committed to practicing serious journalism that reflects Cuba’s reality in all its depth. Thank you for joining us on this long journey. We invite you to continue supporting us by becoming a member of 14ymedio now. Together we can continue transforming journalism in Cuba.

Local Development Won’t Happen under Communist Collectivist Rules

In the La Época mini-industry, the machines for bagging the produce and for bottling have never worked. Photo: Ronald Suarez Rivas

14ymedio biggerElías Amor Bravo, Economist, 28 March 2023 — Local development projects are untenable in Cuba’s communist economy. They need a foundation and a substrate. What are we talking about? Much has been written about local development as a tool for spurring economic activity. Essentially, it is a complex process, a result of local initiative, whose objective is to direct and deploy a region’s resources to a designated business project, with special consideration given to the those living in the area.

This definition is broad enough to indicate that, in general, local development is not working in Cuba’s communist regime. The problem is that these projects rely exclusively on collective initiatives, which should  play only a small roll in local development, when what is needed is private initiative. Once again, Cuban communists copy what other countries do but copy it badly.

That is why, thirteen years after the launch of the first development projects on the island — these were part of an attempt to “update” the Cuban economic model — the results leave much to be desired. Many projects have been implemented but, on balance, the results are disappointing.

An article in the state newspaper Granma looks closely at the results of one such project — La Época, a mini-industry in Consolación del Sur, a town in Pinar del Rio — that began operations four years ago but has not been successful. continue reading

Its failure is a result of all the usual problems: a shortage of raw materials, new technology that was not a good fit, production levels that did not justify the amount of capital being invested, all of which has allegedly brought operations to a halt. The energy shortage, for example, led to blackouts, which led to shutting off the plant’s furnace, which led to shutting down the automated machines that were supposed to bottle and package items such as fruits, vegetables, jams and mayonnaise, which the foreign specialists in charge could not get to work.

Initially, there was clear interest in the project given the very precarious conditions of the old plant, whose operations were unproductive and inefficient. The thought was that, with modernization, it could provide food to the local population and even to the province. But that is not what happened.

As the Granma article points out, and I quote, “The reality could not be more different and today the small Pinar del Rio factory is, if anything, an unfortunate example of something that did not have to happen.” In fact, the most obvious example of failure lies in the fact that, of the twenty-seven employees on the payroll, only five currently remain at La Época, while the rest have been transferred to other units due to the lack of things for them to do.

Granma questions the decisions of the management team, who wanted to build a factory without having first found a reliable source of raw materials to keep things running smoothly, an oversight that is not unique to La Época. But this is not just a management issue. What happened to this company is a good example of the consequences of central planning and of the hierarchical structure that plagues the Cuban economy on all fronts, including local development.

The Granma article also looks at reasons behind the failures of other local development projects in Pinar del Rio, such as the carpentry shop that opened in La Palma in 2010. Equipped with up-to-date furniture-making equipment, it was the first local development project in Vueltabajo. It was unable to reach its production goals because the agency that promoted the project failed to secure an allotment of wood.

Another example is the paint factory in the provincial capital’s industrial zone. While it did manage to turn out a high-quality product, the operation was ultimately unsustainable. The article also mentions the example of a jewelry studio in Consolación del Sur. Launched ten years ago as a local development project to make belts, purses, wallets and other leather goods, it went bankrupt long ago because it could not get raw materials. Then there is the old guayabera factory in the town of Los Palacios. The facility was operating at full capacity from the moment it opened, handling big orders like the one for 14,000 garments, including pants and shirts, for the workers at the Mariel Special Development Zone. Now, it’s all just a memory.

All these projects failed for reasons such as inadequate planning, shortage of raw materials, systematic failure to stick with a plan, difficulty importing equipment and supplies, and loss of markets. In reality, they confirm that collective and state enterprises ultimately do not amount to anything and end up dying of success.

A director from the provincial government’s development office has no problem acknowledging that all the projects, which from the beginning depended on some imported element, had to close. He states, “In commercial terms, they are projects that failed, and they were all involved in local light industry or food services.” And of course, since everyone else invested all the money and assumed all the risk, he is not bothered by this.

It is then that Granma asks, How is it possible for there to be so many failures in one province, which, “paradoxically, has accumulated twenty years’ experience in the field of local development? As the old saying goes, in the blacksmith’s house, there’s only a wooden knife.” And so it goes.

To address these issues, the communist regime has come up with a strategy for decentralizing this year’s budget. The hope is that this will substantially change the way things are done by giving localities a tool that would allow them to plan development “on the basis of previously conceived actions.” Is this the long-awaited solution localities have been been hoping for? Will it serve to guarantee local development?

In numerical terms, there is no shortage of projects on the books. It seems 347 development initiatives have been proposed in Pinar del Rio, which translates to a whopping 250 project ideas that have resulted in 78 local development projects. One would think at least some should be successful. But not necessarily. In the thirteen years of the program’s existence, Pinar del Rio has completed only twenty-two projects, one of them being La Época, which has clearly been a failure.

The difference that exists between possibilities identified by bureaucrats and the realities on the ground leads to two possible conclusions: either planning is badly done or it’s not worth promoting economic activity. Or perhaps both.

Local development needs solvent private initiative to achieve success. Making it soley reliant on collectivist proposals leads to failure. Insuring that investments of time and resources are made efficiently is best done through private initiative. Without a doubt. To avoid disaster and make local development a tool for bettering the lives of Cuba’s citizens, it is essential to involve the private sector. The state must give up its role in this area, the sooner the better.


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