Cuba Says New Business Licenses Will Be Issued

HAVANA TIMES – The Cuban government said Tuesday that the suspension of new licenses for the private sector will not be maintained for “a very long period of time,” local media reported. What “not very long” means in Cuban terms is left to the interpretation of each person.

“We are not talking about a very long period of time, we are not talking about years, we are talking about a normal work process for the approval of these rules,” said the Deputy Minister of Labor and Social Security, Marta Elena Feito, on television state.

In Cuba, “normal” processes can last for months, years or decades, in some cases, depending on how many bureaucratic layers have to be overcome and the political will to solve it.

The statement is intended to reassure self-employed workers who saw with uncertainty the announcement last week of the temporary freeze on new licenses for some of the most popular private sector activities.

Numerous people, including residents, emigrants and potential returnees, found overnight that their plans to invest in a small business on the island had disappeared.

The measure affects growth sectors on the island such as room rentals and café and restaurant services.

The Cuban authorities alleged that the measure was motivated by irregularities detected and seeks “to exercise more effective control by the State.”

“There have been cases where raw materials, other inputs and equipment of illicit origin are used, non-compliance with tax obligations and under-reporting of income persist,” said Feito.

However, state companies and institutions, the main source that supplies the black market and this to the self-employed trades, restaurants and other businesses, will continue as the supposed engine of the Cuban economy.

The official clarified that the pause to the private sector will be as long as “the process of approval of the legal norms that will endorse that policy lasts”.

“The prohibition of new permits is temporary and those who already have the licenses can continue working. In the future, however, no permits will be granted for “wholesale sellers of agricultural products”.

Since 2010, Cuban President Raul Castro initiated a small opening to private initiative. At the end of the first half of 2017, more than 5% of the economically active population worked independently of the State.