Cuba Can’t Afford to Waste Resources on Symbols

With shortages of food and medicine, the Cuban government is using up resources on symbolism.

By Marlene Azor Hernandez

HAVANA TIMES — The online newspaper 14 y medio informed us on Saturday November 12 that “Hundreds of buses with thousands of people in uniform arrived to rehearse the military march that will take place on December 2nd to commemorate the 60th anniversary of the landing of the Granma yacht.”

In July this year, the Cuban government, via Marino Murillo and the General/President Castro, announced to the Cuban people that as a result of the Venezuelan crisis there would be a new economic contraction and measures being put in place included a 50% reduction in fuel supplies to public institutions and a 17% cut in national investments.  [Venezuela is Cuba’s supplier of oil on highly favorable terms and has reportedly reduced shipments.]

The Cuban economic landscape, which has been analyzed by several Cuban economists, is bleak in 2016 and will get worse in 2017. All of these economists agree on the fact that the best way out of this liquidity crisis, which is already endemic in the Cuban economy, is to further the reforms process. Several independent Cuban media platforms have reported serious shortages in high-demand medicines needed for the population.

What is the Cuban government doing “playing with its tin soldiers” in the face of an emergency situation? For the organizers themselves, these waste-of-time events don’t really do anything else but form part of a game of symbolism. On a domestic level, they serve to distract attention away from the government’s economic impotence and are a symbol of force against the population. On an international level, they reveal an absent defense capability.

Other independent journalists have pointed out the fact that the 2016 Bastion military maneuvers and now the rehearsal for a military march are late Halloweenish actions which has already passed us by. Commentators on the State-run TV, dressed up as military personnel and are the laughing stock of the Cuban community who live abroad. On a national level, the Cuban people are asking why the government is spending so much when the state of medicines in pharmacies is so precarious.

What should the government really being focusing on? On the following 15 economic measures, without which the country will remain paralyzed and waste away the country’s resources on these late Halloween displays.

-Get rid of the slow bureaucratic procedure to approve foreign investments. Out of the 400 investment projects proposed for the Mariel Special Development Zone, only 19 have been approved, four of which were national projects, in the last two years.

-Allow workers to be directly employed by foreign businesspeople and not via state-owned employment agencies which retain 80% or more of a worker’s monthly wages. Establish progressive taxes on salaries. Taxes are regressive when they are applied to people who only earn over 500 Cuban pesos (25 USD).

-Reinforce the arbitration process in relations with foreign investors. Today, this process rests in the hands of national courts when it should be dealt with by international trade arbitration commissions, given the fact that repeated seizures applied to foreign businessmen have created insecurity in the context of foreign investment.

-Speed up the authorization process for joint ventures, which to be approved by the State Council today can take up to a year and a half or two years.

-Make the legal status of production and services joint ventures a reality, as five years after being officially recognized, they still remain unable to import or export their products or their supplies and funding sources.

-Give legal security to micro, small and medium-sized private businesses, which is still a promise they have yet to fulfill.

-Allow mixed wholesale markets to exist in harmony with the private and governmental economy, banning any kind of monopoly, be that by the government or a foreign company or a private national company.

-Increase funding for agriculture in collaboration with direct foreign investment.

-Get rid of the dual money and exchange system which distort any kind of efficiency indicator in Cuba’s national economy. State-led companies have a fictitious one-to-one exchange rate for a Cuban peso from a CUC hard currency peso, while workers have to use CUCs at an exchange rate of 25 Cuban pesos for 1 CUC in state-run stores, which are the only ones that have been authorized to import products from abroad. This reform has been announced since 2011 and it still hasn´t been put into effect.

-Reduce the Value Added Tax from 260% to 300% in state-owned food, clothing, shoes and electrical appliances stores so as to increase national demand.

-Diversify the sources of national and international funding, legalizing the investments made by Cuban emigres living in the US and in other countries across the world. This exists today with the remittances that are sent to family members on the island, however, it still isn’t directly allowed.

-Reduce or get rid of the 70% or 75% that private producers and agricultural cooperative have to hand over to the Government by obligation, for a price below that on the market. Growth in agricultural production isn’t meeting the population´s food needs.

-Substitute the 2 billion dollars that the country imports in food per year with investments and funding for agriculture.

-Speed up the creation of joint trade ventures for agricultural crops which don’t exist today.

-Allow professionals to work privately in their fields, which is banned today.

All of these measures are the result of an analysis that Cuban economists have made about the progress of the reforms process where they analyzed the content of the Documents approved at the 7th Cuban Communist Party Congress in great depth.

This is what the government should do in the population´s best interests. Focus on speeding up change and stop wasting public funds on their tin soldier games or in reenacting Halloween a month later.