Cuban Government Begins to Adopt Measures Against Economic Crisis: Trade

A private fruit and vegetable seller with a makeshift cart in Havana.

14ymedio biggerElías Amor Bravo, Economist, 24 March 2020 — Regarding the measures adopted by the regime in Cuba, the state newspaper Granma dedicates space to those published by the Ministry of Internal Trade to prevent and confront COVID19. There is everything, but if you are looking for a headline, it is clear: Cubans are going to have a very bad time.

It is commendable that the regime has decided that hygiene and personal protection in services that handle food is the priority for attention, but this, being important, in Cuba has a second derivative, which is who cares previously about producing food and bringing it to stores and establishments, so long as it is not in short supply and sufficient for the duration of the pandemic and afterwards. And I think this is where the regime’s measures are not sensible.

The health crisis is going to bring about a paralysis of production. This should be the main challenge for the economic authorities. For this reason, these measures of the Ministry of Commerce are aimed only at regulating the activities of the sale of merchandise, food services and hotel accommodations, as well as personal and technical services, during the period of struggle against COVID 19.

But they do not address the technical-productive considerations, and in the face of an alarm such as the one we are now facing, and with a centrally planned and state-based economy, it makes little sense to approve trade-related measures of arguable impact, such as those announced by Granma, without resolving first question of production.

If the regime wants to face the serious situation it has ahead, must first of all address the ministries related to production so that they will be ableto generate goods and services in large quantities, and also quickly and urgently, if they don’t want the pandemic to end in hardship.

I believe that this matter is important enough to warrant more than just a general consideration, such as “ensuring, in accordance with the availability of essential products, the re-provisioning of the network.” And: “Avoid the concentration of goods in one place, in order to reduce crowds and the movement of goods.”

Unfortunately, Cubans know from their own experience that this replenishment of stocks sometimes takes time to arrive and, in the worst case, it never arrives. The actions to be carried out in this production and logistics area need to be more clearly defined, without attacking the rights of those who work, to provide a solution to meeting the needs of the population.

Granma echoes Cuban President Díaz-Canel’s statements on this point, stating that “a stock-taking of supplies will be made, taking into account what can be use can be made of the supplies dedicated to the activities that will now be stopped.” Granma suggested “regulating sales, regulating lines, avoiding disorders and encouraging meals and home delivery services.”

And it continues, “the productive and service activities that will be maintained and those that are not must be defined immediately; as well as the rapid importation of certain products. At the same time, food production will be intensified and the use of inputs will be frozen in the processes that, due to this situation, will be paralyzed and will be destined for retail merchant circulation.*”

In other words, all of these statements from Díaz-Canel confirm that the economic authorities are still at a very early stage, and certainly late, in addressing the problems of the economy that are going to occur, so one must hope that something could happen. The statist bureaucracy has a hard time getting going.

Of the measures related to trade, some propose that “priority be given to the commercialization of agricultural products through the retail network of state markets, supply and demand, kiosks and carts. Avoid the use trade fairs, with the aim of minimizing the risks due to the concentration of people.”

In this sense, I consider it positive that the regime has decided to maintain all the commercial forms of agricultural products, including the vendors who sell from rolling carts, the carretilleros. Until they are immobilized, if the advance of the pandemic requires it, these sellers will solve many feeding problems, especially for older people with mobility difficulties. It would be good if the regime lowered the repression against the carretilleros and allowed them greater freedom in acquiring provisions to attend to their duties.

Honestly, with these two general measures alone, little can be resolved in relation to supplies. And I am concerned with the measure of “creating conditions in all merchandise sales units so that access to the public is staggered (in correspondence with the unit’s capacity)” and that of “reducing the participation of competitors (self-employed worker-vendors) to 50%, in centers, commercial areas and high concentration services, alternating their days of participation in the week.”

These are measures that seek partial confinement and reduce exchanges and provoke higher average purchases than usual, which can end up creating supply problems, lines, rationing and angry protests by citizens if the products do not appear.

As far as the measures concerning state restaurants, road units and workers’ canteens are concerned, I honestly think they are wrong. Specifically, “the opening of these establishments is allowed, applying only methods of rearranging the tables, placing them with a separation of two meters (limiting capacities to 50%) and the recommendation to avoid crowds.”

If the pandemic progresses, this restored activity will most likely decline completely, basically due to the fears of the population, and sales from home will increase, if there is something to sell, because it should not be forgotten that the problem remains the same: that the goods and services are obtained through the production system.

They have only given a certain priority to the family care system, “with the delivery of lunch and dinner, either at home, or picked up by a relative of the beneficiary, or a representative authorized by the social worker.” However, it is known that all the “freebies” of the regime have experienced a notable decline in recent years, and nothing suggests that this has changed with respect to these meals.

It should be noted that the measures have been more forceful with hotel activity (including recreation, tourism and leisure), perhaps taking into account that tourism forecasts will clearly go down in the short term.

In this sense, “self-employment activities for tourism and recreation purposes have been suspended for the rental of homes, rooms and spaces, to people from abroad, foreigners or Cubans.” Technicians or temporary resident foreigners living in homes that provide these services are excluded from this suspension.

Regarding bars and cafes, state accommodation has been suspended in the interior trade system for tourism and recreation purposes for people from abroad, foreigners or Cubans.

Likewise, activities that generate concentration of people have been suspended, such as popular camping, and all those that take place in theme parks, leisure clubs, wedding palaces, dance floors, workers’ social circles, cinemas, theaters, cabarets, sporting events and others. However, food service and merchandise sales are maintained in compliance with the indications established for these activities.

They have also planned to increase home services for the repair and maintenance of minor equipment and fixtures.

*Translator’s note: Official government speak…


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