Cuba’s Private Sector Phases Out Convertible Pesos before the Government

As early as last Monday, many private businesses on the island were no longer accepting Cuban convertible pesos. (14ymedio)

14ymedio bigger14ymedio, Havana, December 21, 2020 — What had been the most desired legal tender in Cuba for years is no longer wanted. The private sector has slammed the door on the Cuban convertible peso, the CUC, one week before January 1, the date the government has decreed that monetary unification will begin. Its death is being observed with neither grief nor fanfare. The only indication of its demise are the signs in private businesses that read, “We do not accept CUC.”

Although the chavito, as it is commonly known, will continue in circulation for six more months, until June 3, private sector workers prefer to do most of their transactions in Cuban pesos. They fear currency devaluation, long lines outside banks to change money and some last-minute regulation the government might pull out of its hat. “It’s better to be cautious. Everything seems very unsettled so it’s better not to be taken by surprise,” says a bread and cookie vendor near Boyeros Street in Havana’s Plaza district.

“I had already been served and was about to pay with CUC when I was told they couldn’t accept them,” recalls a customer who literally stood with her mouth open in front of the counter of a private ice cream parlor on Cuba Street in Old Havana. “This is really an extreme reaction. They still have several more days to exchange convertible pesos,” lamented the frustrated customer. “They’re just losing money.”

But the long lines on Monday at banks appear to validate the concerns of private business owners. “I came to exchange 200 CUC for Cuban pesos. I got here at 5:30 in the morning and I still haven’t been able to get inside because they’re having connectivity problems,” complained a private taxi driver who wanted to get bills in small denominations from a bank located on the ground floor of the Transport Ministry.

“After this, I’ll never accept another chavito. I’ll put a sign in the car that tells customers they can only pay with Cuban pesos. I’ll also put some stickers on the windows so they’ll know before they get in that I don’t take CUC,” he adds. “If accepting CUC because they’re still in circulation means I have to get to the bank at dawn every week just to change money, it’s not worth it to me. Let the Central Bank do it.”

The most cautious and best positioned private businesses are already implementing other solutions.”Our menu is in several currencies: Cuban pesos, convertible pesos, dollars and euros. You can pay with any of these four,” says an elegantly dressed employee outside a privately owned restaurant on San Ignacio Street who is trying to convince some tourists to eat there.”You can pay with cash or credit card. We also accept pounds sterling.”


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