If Vietnam Advanced Why Can’t Cuba?

By Fernando Ravsberg

HAVANA TIMES — Thanks to the President of Vietnam’s recent visit, the Cuban media has shed some light on this country´s socio-economic achievements. However, very little is said about how they have managed to achieve this, going beyond just some generic references to the Doi Moi and their reforms process.

Exports are growing at a rate of 17% per year. They sell telephones, computers, equipment and machines, textiles, seafood, rice and coffee. Ever since they began their reforms, the national GDP has increased by 7% per year on average.

And people’s lives have improved. Poverty was reduced to 12% of the population and they took 25 million people out of misery. They have a very low unemployment rate and Vietnam´s citizens’ incomes, which were around 15-20 USD a month [similar to today in Cuba], “now vary between $200 and $300.” Ninety percent of the population is literate and life expectancy stands at 72 years.

In spite of the cultural and geographical differences, it seems quite logical to look at ourselves in the mirror of Vietnam, given the fact that it is also a small country, with very few natural resources, organized following the socialist model and led by one political party.

The difference between us might be that when they decided to create the “Doi Moi”, they jumped in the deep end, while Cuba’s “modernization” advances along the beach with the slowness of somebody who is afraid to drown. Vietnam’s message is that without a change in mentality, there will be no progress.

Granma newspaper labeled Vietnam´s success a “miracle”. It seems to be a way out so that they don’t have to explain the fact that their progress was the result of access to thousands of foreign investors, of national private business being put in the foreground and of state-run companies’ being given autonomy.

In Cuba, foreign investments – which the government has classified as essential for development – are advancing at a tortoise’s pace. The “Mariel Special Development Zone” has only approved 19 companies in more than two years, while hundreds are still awaiting a response.

Vietnam accepted 2,700 foreign investments over two decades, they advanced with a rhythm of 270 per year on average, which is 28 times faster than the Mariel experiment. It’s not about miracles but about how efficiently decision-makers and those who implement economic policies work.

The Cuban government announces that cooperatives will be open and then they bring them to a halt. In the beginning of this year, Raul Castro said that small and medium size businesses should be authorized and we’re reaching December and not a single one has been approved, they haven’t even created the framework necessary to legalize them.

At the PCC Congress, Raul Castro recognized that legalizing such private businesses was a point that awoke controversy. The problem is that no socialist model has survived without small and medium-size private businesses, if we exclude North Korea of course.

While state-run companies have their hands tied behind their backs because decision-making and funds are entirely controlled centrally. This makes it a symbol of inefficiency in the eyes of the Cuban people, many of whom begin to believe that the only solution is privatization.

Some people watch every step the country makes in opening its economy with fear, which means that debates are never-ending. The Committee which drew out the theoretical base for labor reform had worked for over a year, and when they finally presented their 614 points, they were asked to make 600 changes.

And while decision-makers get themselves into a mess with theoretical debates, the nation continues to lose its greatest resource; tens of thousands of young trained professionals who leave the country because the Government pays them a pittance and doesn’t allow them to undertake their own projects.

I met a brilliant mathematician-computer expert who proposed some tools to improve our website. He didn´t want to emigrate, he tried to work for clients abroad from Cuba and they banned him from doing so. Now he lives in another country, where he lends his talent and earns his money.

If the Cuban government wants to be socialist, there are only two models left: that of China and Vietnam and the other one following North Korea’s example. The latter model was the one that broke away the USSR and its allies’ economies, including Cuba. Even Fidel Castro has publicly recognized the fact that this doesn’t work.

Now Vietnam is announcing a new project “to convert itself into an industrialized country geared towards modernity.” And it doesn’t seem to be a populist speech, when they have reached their current level of development after coming out of a war that had destroyed their nation.

Meanwhile, in Cuba, the only thing here that grows is the never-ending debate about the “ideological dangers” posed by the prospect of a private shoe factory, wholesale markets, and private work of professionals, cooperatives, economic de-centralization or monetary unification.

Cubans advised the Vietnamese to cultivate coffee and to breed tilapia. Today, they export both of these things and Cuba is forced to buy coffee abroad and to hand out imported chicken because they don’t have fish. Is it really that hard to choose a way forward?