Will Cuba’s “Self-Employed” Advance in 2019?
HAVANA TIMES – 2018 was a bad year, according to some self-employed workers in Cuba who we regularly consult for our features.
The government experimented and faltered and that led to a high level of uncertainty among private sector workers and the many others who aspire to working on their own. There has especially been a lot of tension since 2017 when new rules were announced and implemented a year and a half later, in December 2018.
If we take a look at this year that has recently drawn to a close, we can see that there were several turning points for this sector, which today comprises 15% of the country’s total labor force and brought in 12% of the country’s total tax revenue in 2017.
The devastation of a year (2018) that kicked off with bad news
January 2018 began with a pause, a pause that shouldn’t exist, according to the slogan of the Communist Party economic Guidelines. Nobody knew how long the restructuring process (announced last summer) would last, although Cuban officials had already shed some light on some of the measures: one license per person, no more tax exemption on the first five employees, amendments to the Transport Operation license and more controls from local governments, to name a few.
Marino Murillo, the Communist Party’s economic point man, said the restructuring of self-employment was done with the aim of “(…) reverting everything that moved away from the original idea.”
One of the most worrying things that could be made out ever since greater restrictions were announced (which have been confirmed with the regulations put into effect now in December) is that the state administration continues to increase its prerogative to decide over the fate of independent workers, while leaving them without the chance to defend their rights in institutional bodies, such as courtrooms. It’s essentially a matter of judging and being the judge because a minister is the last person you can complain to about a measure imposed by a government official… from the same ministry!
Despite the despondency that is in the air around us, we still come across many Cuban entrepreneurs with just enough energy to pursue efforts that will bring about favorable change for themselves, their families and their communities.
Between a rock and a hard place
The new regulations have come into effect and nobody is at ease.
Even though the authorities said that people would be informed, and a lot of time would be spent “preparing” independent workers affected by the new regulations, our journalistic investigation revealed a lot of confusion and doubts, even within the very officials who were responsible for giving answers to those affected.
Up until late September, only 14% of independent workers who should have gone to these “preparation” workshops organized by the authorities actually received them.
In October, the government began its experiment with private collective taxis in the Cuban capital. With 26 collective taxi stations and 23 established routes, the authorities are trying to organize passenger transport in the capital, and to get a control of “diverted” fuel resources and tax evasion. The restructuring includes every vehicle that is capable of transporting between 4 and 14 passengers. In December, the result was 2000+ fewer cars offering passenger services in Havana.
November
A sector of the self-employed were calling them “arbitrary measures that have not been approved by anyone who will have to comply by them.”
And in December, their voices were heard.
The Council of Ministers adjusted several of the regulations that came into effect on December 7th. The amendments included being able to exercise more than one profession. New licenses will also be granted for 26 out of the 27 job classficiations that had been suspended, computer programming being the only exception.
On the other hand, food establishments will be able to have over 50 seats to serve customers and the amount of their income they can have in cash on hand has been increased to 35% to cover smaller expenses and unexpected events, and this doesn’t have to be deposited in a bank account as the rest does.
The president, Miguel Diaz-Canel, said at the most recent parliamentary session near the end of December that “we have recognized the private sector as a complement to our [state] economy and we have no intention of standing in the way of its progress, but it needs to function within the bounds of the Law.”
However, there is still a lot of prejudice and restrictions, and it is very hard for us to believe in the political will of a government that has been opening and closing doors to the private sector with so much discretion ever since 1968 [the year all small private businesses were taken over by the State].
Taking official declarations by their word, we hope that this 2019 is a better year for Cuba’s small business owners and the people who depend on them for employment, so they can provide the services that the great structural framework of state-run companies is unable to offer in an efficient manner.
The next 12 months will speak for themselves.