Castro freezes Cuban private sector .

[helix]

This is troubling news indeed .

 

http://abcnews.go.com/International/wireStory/castro-freezes-cuban-private-sector-throws-future-doubt-52757833

[Santiago]

Two years after taking office, President Raul Castro widened the niche for private enterprise in Cuba's state-dominated economy. Capitalism came pouring in.

Slowly at first, then gaining speed, spare rooms for rent became rental homes, which became boutique hotels. Backyard cafes became elegant restaurants and bustling nightclubs, backed with millions in capital from the prosperous Cuban diaspora in Miami, Latin America and Spain. English tutors started citywide private after-school programs. And the booming private economy reached into the Communist-led bureaucracy — paying off inspectors, buying stolen state goods and recruiting talented employees with salaries dwarfing those in the public sector.

 

Eight years later, on the verge of leaving office, Castro has thrown the brakes on private enterprise in Cuba again, warning of the rapid pace of change and criminal activity. The decision has raised fundamental questions about the nation's economic path.

The Cuban government proclaimed in August that it was putting a temporary halt on new licenses for bed-and-breakfasts, restaurants and other businesses until it could issue new regulations to control illegality. Entrepreneurs whispered about new regulations coming in a month, maybe two. But summer stretched into fall, fall into the new year, and six months later, Cuba's private economy remains frozen.

The state-run economy responsible for 70 percent to 80 percent of GDP is stagnant. A once-promising worker-owned cooperative sector has shown little recent growth. Cubans are increasingly wondering when the private economy will be allowed to grow again, and, more broadly, how their government intends to deliver on promises of a sustainable, prosperous socialist system.

continued at link

[Santiago]

The more things change the more they stay the same

[Nino]

3 hours ago, Santiago said:

The more things change the more they stay the same

Not in Cuba they don't.

After almost 15 years of travelling there I have come to realize that all the changes so far have been negative for the economy.

How conditions can change for the worse year after year I don't get,  I just have given up hope it will change for the better in the near future.

[Fugu]

With you on that, Nino.

Well, just another 'shithole country', what else to expect.....   ...()

Now, seriously, this chap here is a bit naive, if you ask me:

>"Self-employed workers aren't asking for neoliberalism or political change, just that they let us work," said Camilo Condis, a 32-year-old industrial engineer who rents out an apartment and has a license to work in a restaurant. <

You can't have a private sector running under a communist system. This isn't working, an illusion. And what we see is the consequence of it. First step of all steps would have to be a radical system change. Or - consequently, no private sector at all. Otherwise, corruption and social inequality are rising uncontrolled (as is to be observed).

In their struggle to keep economy afloat, the party hopes having found a 'simple' recipe to push GDP by this, ignoring all side effects. The whole idea was doomed to failure from the get go. What they don't seem to understand: when you want private entrepreneurship to be successful you can't hinder people in being busy and creative. That's the very meaning of the term "business".

[krish the fish]

For those with a finger on the pulse of Cuba, is the election in March or Raul's planned step-down in April going to cause big changes in the country? It seems like big news that's going unreported or under-reported as far as I've seen. Is this something that we should be optimistic about for the future of the Cuban people?

[joeman]

IMO, they will have to fall hard to change.  The prerequisite for more change is more pain unfortunately.  The Cuban people don't want to go through that.  Maybe some do.  Maybe some feel it's worth it.  Change is hard and coming out of communism to capitalism has it's pain points.  Hoping it happens, that it's bloodless and relatively painless.

[Santiago]

Sounds like a 100% marginal income tax rate is in order

[Batterup]

Are there any private cigar producers in Cuba? This will have no effect on cigar production or quality.