Cuba: Reforms in the Countryside Should Not be Left Half Done

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

14ymedio bigger14ymedio, Elías Amor Bravo, Economist, 5 April 2021 — While more and more images are arriving of the impact of the social protests that increase throughout Cuba — including the San Isidro Movement and UNPACU — the communist leaders try to cope with the great problem of lack of food and introduce small reforms such as renting a part of the State Agricultural Markets (MAE) to farmers, agricultural land leaseholders and cooperatives, as sources of supply. Meanwhile, the inefficient and unproductive state intermediary, ceases to provide these functions.

Measures that have yielded, where they have been implemented, immediate results, such as a greater number of products sold, higher collections from sales, customers who are more and better satisfied thanks to greater freedom of choice, in short, small advances in the serious problem of scarcity that exists in the country. The field-to-market channel, previously obstructed by communist inefficiency, now serves as a win-win for everyone.

However, the incorporation of private management into the State Agricultural Markets for the commercialization of agricultural products is a formula that, without reaching the structural reforms that the Cuban economy needs, confirms that where private initiative increases its participation and occupies spaces that, until then, had been prohibited by communism, the economy begins to function again and to produce.

This means that it is not a question of leasing the facilities from the private sector, while the state continues to be the absolute owner of the means of production, but rather that it is necessary to privatize, transfer ownership of the means to private actors so that they can be drive profitability, motivation, and scale growth.

Everything that can be done in Cuba to open spaces in the economy and society to private initiative should be welcomed. And it is necessary to provide legal guarantees so that a return to nationalization does not take place, when the regime wants, but rather that there are stable reforms that provide security to the new private actors. The same thing will happen with the opening of licenses to 2,000 activities or the allocation of food services and small businesses to private operators.

All of a sudden, positive effects will be noticed, because private initiative works much better than state initiative, and is capable of reversing the state of prostration and inefficiency in which the economy finds itself. It is a pity that these opening decisions are adopted by the Cuban communist regime as a consequence of social pressure and the latent threat of a social outbreak of great proportions. The transfer of economic power to private parties should be the result of a decision based on the opportunities that arise from it, and that it is the only way to open general spaces for freedom, prosperity and development in Cuba.

Trade reforms, as a note from the State newspaper Granma says, have been applied slowly and only in certain areas, because the government does not want to lose control of the economy. And this despite the fact that the new markets sell between 10 and 13 products, planning to expand that to 23, a consumer basket unknown to many Cubans, made up of numerous meats, vegetables and fruits, among others. The level of collection also increases, around 19,000 pesos as a daily average, a figure higher than previous businesses, and all this without increasing prices, despite the general inflationary environment.

The leasing of the establishments incorporates another measure, which is still in the testing phase, in Ciego de Ávila and Morón, according to which greater autonomy is granted to the management of the market itself, which has transport and can contract for products directly anywhere in the province, as well as in the base business units of Acopio.

Announced in the same Granma article is the possibility of making online sales for which the customer can pay digitally, and then has 12 hours to reach Market 3 (Marcial Gómez, corner of Benavides ) to collect their products in more prominent formats. The objective is to transfer the products purchased in this way to homes, say those responsible for it.

All of these reforms are positive, but they fall short. There is no private property either at the origin of production, or in the distribution markets. Private property grants the necessary independence and autonomy from political power for free and unconditional decision-making by the members of the supply chain, except for the objective of efficiency and profitability. It is necessary to continue the reforms towards the legal and structural aspects that weigh down the economy and lead to the current scarcity and poverty.

The problem of the Cuban countryside, its unproductivity and inefficiency, is not fixed by leaving production cost increases that fall on the profitability levels of the producers, as Murillo has done with electricity, water or airplane transport among others, by disproportionately increasing budget subsidies, with the increase in the additional public deficit that this may entail in a context of high inflation. The Ordering Task has dealt a severe blow to the agricultural sector and these patch-type measures try to mitigate the effects. But they are not being taken in the only area that matters, that of structural reforms.


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