opening of dollar stores stirs discontent in Cuba

[El Presidente]

 

 

 

https://www.heraldmailmedia.com/news/nation/cuban-leader-diaz-canel-gets-poor-ratings-as-opening-of-dollar-stores-stirs-discontent-in/article_5f95a06f-92bb-5329-8fe0-7ecefcc78a99.html

Cuban leader Diaz-Canel gets poor ratings as opening of dollar stores stirs discontent in Cuba

• By Nora Gamez Torres El Nuevo Herald (TNS)
•  

 

 

A Hail Mary reopening of dollar stores in Cuba to deal with the coronavirus pandemic's fallout has angered many Cubans, as the increasing inequality in a society that claims to be egalitarian gets the spotlight.

The announcement came last week during an odd speech by Cuban leader Miguel Diaz-Canel in which his irritation was not lost on the population. He also promised to implement some reforms already approved by the Communist Party in 2016 but inexplicably postponed, including the creation of small and middle-sized private companies and some opportunities for importing and exporting.

Both the announcement and Diaz-Canel's performance have received an unprecedented amount of criticism among Cubans.

 

More than a thousand readers aired their questions and frustrations on Cubadebate, a state media outlet, as many Cubans who do not have family abroad to send them dollars grapple with the idea that food items such as meat or ice cream would be out of their reach.

"And the Cuban who does not receive money from abroad? And even worse, what about the pensioners? Many of us have been left out with this measure. Perhaps this is not a republic 'with everyone and for the good of all,' a reader identified as Yoyi said in reference to a phrase by 19th-century independence leader Jose Marti that is frequently used by Cuban leaders.

Hosts of a podcast made in Cuba discussed "the bad impression" left by Diaz-Canel's speech.

"He looked upset and honestly looked bad in that speech. I think the general opinion of the people is that they didn't like the speech," said Camilo Condis, a young Cuban entrepreneur and host of "El Enjambre" ("The Swarm"). Another host, Miguel Alejandro Hayes, said the Cuban leader had failed to deliver a "hopeful message."

The lack of concrete details of how the economic plan would work in reality suggests it was rushed because of the pandemic, even though the economy plunged last year due to the Venezuela crisis and tougher sanctions by the Trump administration.

Cuba's economic situation is almost as dire as it was in 1993, during the infamous Special Period when Fidel Castro first allowed the circulation of dollars to counteract a sudden 35% GDP loss after the collapse of the Soviet Union. And, as in 1993, the gamble largely depends on the Cuban exiles abroad sending more remittances to the island so they can be used at the new stores and, in theory, as starting capital for the private sector.

This might not happen soon given the impact of the pandemic in the global economy. Remittances from the U.S. are also restricted to $1,000 per quarter per person, and some of the primary services used to send money to Cuba, such as Western Union, are still delivering the payments on the island in the local currency known as CUCs.

With so many unknowns, the sudden dollarization has been deeply unpopular.

A Cubadebate reader even quoted George Orwell's "Animal Farm" to point to the widening class inequalities that might result from the new measures.

"I am an architect; I work for this country in a state company, have no family to send me money, and cannot afford to buy U.S. dollars with what I earn. What will happen when I need basic items or food for my house and can't find it at CUC stores?" wrote a reader identified as Giselle.

"It seems that many of these measures are going to create much more inequality between social classes," she continued. "And I say much more because they do not want to recognize it: "We are all equal, but some are more equal than others."

The dollar remittances are not supposed to circulate in cash but to be deposited directly to Cuban bank accounts. But the measure adds more chaos to the already wrecked monetary system, which will now be working with three currencies: the dollar; the Cuban peso, in which state salaries are paid; and the CUC, Cuba's own local hard currency. One CUC is equivalent to 25 Cuban pesos.

Because the government also eliminated this week a 10% tax on the dollar, the CUC has near parity with it in the official exchange houses known as Cadecas. Buying dollars in Cadecas and banks, however, is limited and the currency is not always available, so most Cubans turn to the black market instead, where purchasing dollars is more expensive.

Almost everything from food to household items was previously sold in CUC government stores even though workers are paid in a different, devalued currency, the Cuban peso. Since last year, Cubans have been struggling to find essential food and hygiene products in mostly empty supermarkets. Also last year, the government started selling home appliances in certain stores in dollars but many complained of the few items stock.

 

Although Cuban officials promised that 47 "essential" food and toiletries would still be available at CUC stores, Economy Minister Alejandro Gil fueled the discontent by speaking of "high-end" and "middle-end" products that would only be available at the new dollar stores. And the disappointment is visible even among core supporters of the communist government, who resent the aid from Cuban exiles, for years scorned by the government as "counterrevolutionaries" and "worms."

"I am very saddened that, once again, the revolutionary government resorts to measures that benefit first those who have relatives in the United States, claiming further 'redistribution,'" a Cubadebate reader identified as Rene said. "Most of these beneficiaries are disaffected with the Revolution. Anyway, we have already lived through this, that Cubans residing within the 'enemy' (the U.S.) come to Cuba on vacation, rent cars, stay in the best hotels and travel around the country like they own it. These things are out of reach for the working people, and then I wonder, where do we leave dignity?"

Criticism of the dollarization spread on social media even before the official announcement, thanks to a leak to independent news site 14ymedio. And it got under Diaz-Canel's skin.

"The enemy, its media and its mercenaries work to sow hopelessness and discouragement ... they speak of economic apartheid. Can you talk of economic apartheid in a country where the government is concerned every day with how most of the things could reach everyone equally?" he said, visibly upset during a lengthy tirade against the U.S. and the "enemies" of the Revolution.

But even other liberalization measures have received significant push back from the population as it was clear the government will keep significant control over the economy.

On live television Wednesday, Rodrigo Malmierca, the foreign trade and investment minister, gave more details about how self-employed workers, or "cuentapropistas," and future "micro-enterprises" will be allowed to import and export.

A cuentapropista needs first to open a bank account in dollars. State enterprises would act as intermediaries, arranging prices and controlling how much of the revenue would stay in the account for future purchases and restocking. But the account owner would not be able to take dollars out of it, only the local currency.

Cubadebate readers asked how so much government control would boost investment and production.

"Do you think that future investors from those 'micro-enterprises' are fools?" asked Roger Rivero, another Cuban commenting on Cubadebate. "They would have to sell through exporters that fix the prices; a mysterious portion of the revenue is retained, and they cannot get their profits from selling abroad in hard currency."

"Gentlemen, seriously, LOOSEN the grip!!!! Enough of so much control over other people's money."

———

[El Presidente]

 

https://havanatimes.org/opinion/cuba-there-was-food-but-not-for-us/

Cuba: There Was Food But Not for Us

 July 24, 2020

By Yoani Sanchez (14ymedio)

The shelves full of meat at one of the US dollar stores. (14ymedio)

HAVANA TIMES – When the sun rose this Monday, about 250 people were already waiting outside the Boyeros y Camagüey store in Havana to buy food and toiletries with foreign currency. Since last week, when the Cuban government confirmed what the independent media had already reported, the start of the sale of food in foreign currencies through magnetic cards has monopolized the talks and the outrage.

This weekend several images were leaked from the interior of one of the shops preparing to open its doors on July 20. So, we came face to face with a reality that we suspected but that we have seen confirmed on those shelves full of preserves, in the refrigerators loaded with meat, and on the shelves full of toiletries. There were products but not for those who only had national currency.

Where were all these sauces, these cuts of beef, the ground beef and these packages with beans when for months people have had to spend hours, if not days, in a line to buy what little stores had for sale in convertible pesos? Is it that they are going to make us believe that all this arrived in the country last week, circumventing the American embargo that the Plaza de la Revolución always uses as a pretext for the shortages?

These goods were here but the authorities did not want to sell them in the stores in Convertible and Cuban pesos (CUP and CUC). All those arguments that there were no raw materials and that the pandemic had left the country without the ability to buy basic items, were just to justify why there were no products for sale in exchange for those colored slips of paper that they still insist on calling “Cuban pesos,” when in reality they seem to levitate with so little worth.

They have kept us passing most of our lives in a long line to get a package of frozen chicken or some detergent, while in state warehouses there were tons of merchandise that was reserved exclusively for those who have the currency of that country which, in official propaganda, remains “the enemy.” This peculiar adversary, whose currency it is necessary to use to sustain a dysfunctional and unproductive system like the one that exists on this Island.

Today, when the police distributed the first 200 turns in line outside the Boyeros and Camagüey market, customers prepared not only to buy food and cleaning supplies, but also to peer into that inventory of products that has been hidden from us for months.

[StogieSteve23]

Sad stuff here.  Thank you for posting.  

[NSXCIGAR]

Perhaps this is not a republic 'with everyone and for the good of all,'

Hey, I think they might be on to something.

Then again, the fact that this is the chief event that prompted anyone to consider that is pretty tough to believe. And what is this doing in the propaganda rag in the first place?

[NSXCIGAR]

.

[Habana Mike]

Much truth to this and the discontent from on the ground there.

[PigFish]

There are plenty of Marxists in my country that seem to have socialism 'all figured out.' I say we trade 5 to 1, politician Marxists to doctors!

Egalitarian... my ass! 

-the Pig

[Fugu]

On 7/25/2020 at 2:09 AM, El Presidente said:

A cuentapropista needs first to open a bank account in dollars. State enterprises would act as intermediaries, arranging prices and controlling how much of the revenue would stay in the account for future purchases and restocking. But the account owner would not be able to take dollars out of it, only the local currency.

what you call 'parasitism'
 

On 7/25/2020 at 2:09 AM, El Presidente said:

Although Cuban officials promised that 47 "essential" food and toiletries would still be available at CUC stores, Economy Minister Alejandro Gil fueled the discontent by speaking of "high-end" and "middle-end" products that would only be available at the new dollar stores.

what you call 'shafting'.

 

Bringing the former GDR Intershop approach to a whole new level....

Never had the 'revolution' so openly been demonstrating the failing of its great "ideas".

[1LegLance]

This really sucks, I remember going a long time ago when you could use dollars and anything decent was at the "diplomatic" stores. 

At least getting rid of the 10% penalty on dollars will help more money flow through the economy. 

I wish I could go and spend some money with locals at an Airbnb and small restaurants....it will be wild once travel can happen again.

[JohnnyO]

Read an article in CubaCute that the CUC will continue to be used. If you exchange $100 US in a CADECA (exchange house) you will get 97 CUC, as it has always been more valuable. My guess is that if we are allowed to buy anything in USD you will get change back in CUC and at .97. Current street value has it about $1.30, it could go down once the bags of cash start rolling in from Miami at $1.10-$1.20 or go to hell in the long run at $1.50 or more. For the locals the issue is that certain items that have been missing for quite some time; toothpaste/deodorant food items can only be bought in USD at those certain stores with the Cuban debit card. Its a motivation of sorts to get the USD in to the governments hands. The CUC and CUP will have limited uses, which will create more fear about holding on to it. John