How the Communist Party Regards Cuba’s Reform Process

Twenty-one percent of the economic reforms agreed to in 2011 have been implemented

Photo: Estudios Revolución.
The Communist Party Central Committee in session.  Photo: Estudios Revolución.

HAVANA TIMES — Today, Cuba’s major official newspaper Granma published a note reporting that Cuban authorities have implemented 21 percent of the economic reforms agreed to in 2011, DPA reported.

An additional 77 percent of the 313 “guidelines” for the “updating of Cuba’s economic model,” as the market reform process is referred to on the island, are supposedly being implemented, Granma added in a report on the upcoming Congress of the Communist Party (PCC), to be held in April.

The economic reforms program was formally approved in 2011 during the 6th PCC Congress. Since then, the government has undertaken gradual liberalization processes, introducing market elements into its planned socialist economy model.

Within the framework of these reforms, nearly half a million persons have been authorized to work in the private sector. Over recent years, Raul Castro’s government also partially liberalized the automotive and real estate markets.

The government is also seeking to draw in more foreign investment. Among other measures, it created a free trade zone at the Mariel port, 40 kilometers west of Havana, and approved a new foreign investment law that offers facilities to foreign companies.

The State sector, however, continues to account for the bulk of the Cuban economy. Licenses for private initiative, referred to as “self-employment,” encompass a mere 200 minor trades. Foreign companies that operate in Cuba do so under a number of important restrictions.

The leadership of the PCC held a two-day closed debate regarding documents related to the economic reforms and the 7th Congress scheduled for April, Granma reported today.

The Party Central Committee assessed the results of the implementation of the “guidelines” over the past five years and spoke of updating these, the report announced.

“Those in attendance underscored the progress made over the five-year period and acknowledged a number of measures have not yet had an impact on the personal economies of the population,” the newspaper reported.

At the meetings held by the PCC Central Committee, an Economic and Social Development Program with aims up to 2030 was also presented.

The 7th Congress of the Communist Party is scheduled for April 16, 2016. In addition to assessing the reforms program, attendants must elect the new members of the Central Committee. Party authorities have not divulged a detailed agenda for the Congress, the most important political event in Cuba this year.

7 thoughts on “How the Communist Party Regards Cuba’s Reform Process

  • A certain amount of the heavy crude that Cuba receives from Venezuela is resold in the open market to generate hard currency. Reducing the amount Cuba receives will force the Castros to decide between blackouts or purchasing food. Either way, Cubans suffer.

  • I am concerned for my family members in Cuba. I hope the economy can evolve fast enough to avoid a hard landing. If the historicos chose to double down as in your prior post, it will get very bad.

  • Additional pressure will soon come to bear on Venezuela to stop the petrocaribe oil giveaway. The deal Venezuela has with China to repay the 150 Billion or so in loans requires them to ship oil based on a fixed dollar amount. As the price of oil drops more and more must be shipped to China yo meet that commitment, leaving precious little to sell to the US, their leading cash paying customer.

  • But even a 10% contraction will be all the more painful when you consider that Cubans are already suffering. Just before the collapse of the Soviet Union, I am told that store shelves were full in Cuba. Of course one can certainly argue that since Cubans are already suffering, further contraction is no big deal. I take the view that a breaking point exists and another 10% less may just be enough to reach that point.

  • Big problem for Venezuela. Their heavy tar sands type oil needs 30% to 50% diluent to be transported. They appear to be low on cash to import sufficient diluent. Their own supply of light crude is running low. The cost production is estimated at $20 a barrel and current market price is $24 a barrel. I have read that Venezuela revenue has dropped from $75 billion to $25 billion a year in 2015. Oil is 96% of Venezuela exports. Their economy is dying.

    Cuba receives 80,000 to 100,000 barrels a day free. They refine and resell part of the oil to earn foreign currency to import food and other needs. The impact will be less then when Soviet Union collapsed. This time the impact expected to be about 10% GDP contraction versus 40% to 60% in 1991. Of course it could be worse than 10% contraction.–finance.html

  • I appreciate your optimism but I don’t share it. After the collapse of the Soviet Union, a much younger group of historicos doubled down on the Socialist model. Fidel legalized the US dollar and casa particulares but as soon as Chavez extended the Venezuelan teat, Fidel reversed himself. I expect these very same historicos, 20 years older and more set in their ways to continue to resist change. I hope that I am wrong.

  • Honest statement:
    “Those in attendance underscored the progress made over the five-year period and acknowledged a number of measures have not yet had an impact on the personal economy.”

    It is of course the personal economy that people actually care about. I have high confidence that reforms will continue. Certain things are working and other things are failing and have failed for decades. The external economic environmental pressures are growing. Venezuela has propped up a failed model, but that time is ending. It is not just Venezuela’s revolution that is imploding. Look to any other economic partner, China, Brazil or Russia.

    On April 16, 2016 the 7th congress will chose survival. Cuba’s leaders are way smarter than Maduro’s doubling down on failure. Cuba will be socialist but with a market economy, unified currency and what ever it takes to survive. Change is underway.

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