Published on Saturday, November 28, 2009
By Marc Frank
HAVANA, Cuba (Reuters) -- Cubans are bracing for hard times in 2010 as
President Raul Castro slashes imports and cuts government spending to
get Cuba out of crisis -- and they are growing impatient with the slow
pace of economic reform.
Hurricanes, the global recession, US sanctions and the inability of the
communist-run island's command economy to maneuver have put an end to
recovery from the 1990s crisis that followed the Soviet Union's demise.
Local economists agree there will be little if any growth this year for
the first time in more than a decade as Cuba battles a cash crunch that
has forced it to stop paying bills and freeze bank accounts of some
foreign companies in Cuba.
Castro, trying to balance books overflowing with red ink, has reduced
imports this year by a third, or some $5 billion, and cut local budgets
and energy consumption.
Cuba is dependent on imports, including food and fuel, of which about 70
percent of what it consumes comes from abroad.
The communist government gets moral and economic support from Venezuelan
President Hugo Chavez and other leftist leaders in Latin America, as
well as China, but Cuba's income from tourism and exports of nickel,
petroleum derivatives, cigars and shellfish has fallen sharply this year.
The austerity moves were necessary after Cuba's trade deficit soared 65
percent and its current account, which measures the inflow and outflow
of foreign exchange, went from a $500 million surplus in 2007 to an
estimated shortfall of nearly $2 billion last year, said the economists,
who requested anonymity due to restrictions on talking to foreign media.
Castro's budget-cutting will put the current account into the black this
year and "he intends to keep it that way in 2010," said one economist,
indicating the belt-tightening will not end soon.
Castro, who took over as president from his ailing brother Fidel in
2008, makes no bones about dismantling the paternalistic economic and
social model he inherited.
"Let's not deceive ourselves," he told the National Assembly a year ago.
"If there is no pressure, if the people do not need to work in order to
cover their necessities, and if we continue to give things for free here
and there, we shall lose our voice calling people to work."
Castro, who served as defense minister for decades, in March replaced
most of the economic cabinet he inherited, filling key posts with former
and active military officers.
He has implemented reforms in agriculture, wage structures and some
other areas but the changes have so far been small and reached few of
the island's 11 million people.
Cubans say that if Castro wants to do away with things like their
monthly food ration and free workplace lunches, he will need to give
them some way to raise incomes that now average less than $20 a month.
There has been speculation he would take measures such as allowing small
businesses to operate and putting some of the retail sector in the hands
of semi-private cooperatives but, so far, nothing like that has
Recent grassroots discussions conducted by the ruling Communist Party
revealed growing impatience with the government's inability to propose
concrete alternatives and get its own house in order, participants said.
"I realize the food ration has to go but first we have to know how they
plan to do it and what will come after," said Pedro, a Havana pensioner.
"I agree with the changes Raul has made so far but it seems to me there
are a lot more things that need fixing," Renaldo, a Communist Party
activist who helped organize the discussions in central Cuba, said in a
People involved in the meetings said the state bureaucracy came under
While farmers applauded Castro's decentralization of the sector, higher
prices for their produce and grants of fallow state land to 100,000 new
tillers, they questioned the government's continued stranglehold on the
supplies they need and the sale of their products.
"Farmers have never wanted the state to give them anything. What we want
is that they sell us what we need to work and produce," Evelio, a farmer
in central Cuba, said in a telephone interview.
Factory workers complained Castro is urging them to produce more but
that the state system is not providing the needed supplies.
"I cannot plan anything because it depends on what they give me, on
planning above," said Carlos, a factory worker. "And there the problems
Caribbean Net News: Cubans fear hard times ahead, impatient for change
(28 November 2009)