The Official Sale of Dollars in Cuba Begins and Each One Will Cost 123 Pesos

The purchase can be made at 36 exchange offices and a branch of the Banco Popular de Ahorro in Isla de la Juventud. (14ymedio)

14ymedio bigger14ymedio/EFE, Havana, 22 August 2022 — The Cuban government announced on Monday that it will start selling dollars to the population on August 23 at a rate of 123.60 Cuban pesos (CUP) per dollar. The 37 premises authorized to carry out this operation will report daily the number of people who can buy that day, “depending on the availability of foreign currency,” said the Minister President of the Central Bank of Cuba (BCC), Marta Sabina Wilson González, on the Roundtable television program, hosted by Randy Alonso.

Initially, a person will be able to buy only $100 or its equivalent in other currencies, although Wilson González did not specify how often this can be done. The sale will begin in 36 exchange houses (cadecas) and a branch of the Banco Popular de Ahorro in Isla de la Juventud.

The official said that both the exchange rate, for now 120 CUP for a dollar, and the margins, will be adjusted if necessary. In addition, the purchase limit of $100 per person “can be extended” later.

“If the dollar is the most difficult currency we have for export, then the idea is for people to demand that currency, and we want that purchase to be fundamentally from the dollars we have in stock in the cadecas,” said the minister president of the Central Bank.

The Cuban authorities said that the euro is the currency that has entered the official foreign exchange market the most since they implemented the new exchange rate at the beginning of the month, followed by the dollar, the pound sterling and the Mexican peso.

The Minister of Economy, Alejandro Gil, for his part, acknowledged that “there is a demand for cash dollars” on the Island, whether to emigrate, to go shopping abroad or for other reasons. However, he clarified that right now the only way out for these dollars is to sell them on the foreign exchange market.

Cubans buy dollars to emigrate, make domestic transactions and leverage their little savings in the face of the collapse of the power of the CUP to buy goods and services. Inflation and lack of productivity have pushed the national currency into abysses never before seen.

“We’re not going to fall behind the exchange rate of the informal market,” Gil said for those who expect the official rate to compete against illegal networks. “The first step is for the State to regain control of the value of the currency,” the minister clarified. “This is not a market economy,” he stressed.

“Little by little, the State will advance in controlling the foreign exchange market,” Gil reaffirmed. But “if you have a partially dollarized market,” there will always be a demand for foreign currency. “We will reach a time of lower demand for foreign currency when we have more products available in Cuban pesos.”

The minister, who repeated the word “challenge” several times to describe the foreign exchange market, warned of the need to relaunch Cuban industry in order to sustain the pulse of the currency and reiterated his criticism of the “voluntarist” vision of the economy. “The strength of the economy is what will allow us to stabilize the exchange rate,” he explained. “You have to come down to earth and understand the sense of urgency,” he confessed.

“This is not for the new rich,” Gil defended himself. “This is not a measure for those who receive foreign currency,” he said in a speech, trying to reinforce the idea that there is an official script that includes, in the medium and short term, an improvement in daily life. “It’s not improvisation; nothing we do is improvised,” he said in the midst of a climate of increased social criticism.

Reactions to the new announcement flooded the social networks. Cuban economist Mauricio De Miranda Parrondo said ironically on Twitter: “I think the next decision of the Government will be to sell foreign currency through the ration book in Cuba. Randy says that they will assign turns in the line. I imagine they will end up making phone appointments.”

Translated by Regina Anavy


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