U.S. academics say Cuban reforms not going well

Posted on Saturday, 05.10.14

U.S. academics say Cuban reforms not going well
BY JUAN O. TAMAYO
JTAMAYO@ELNUEVOHERALD.COM

Cuban government efforts to open its doors to more private enterprise
cut state payrolls and lure foreign investors face a string of
restrictions and complications, several U.S. academics said during a
seminar Saturday in Coral Gables.

The island's communist government "has a love-hate relationship with the
private sector," said Mario Gonzalez-Corzo, a Cuban-born professor at
the City University of New York.

Ruler Raúl Castro has been allowing more private economic activities in
hopes of jump-starting a Soviet-style economy since he succeeded brother
Fidel Castro, temporarily in 2006 and then officially in 2008.

But while up to 485,000 Cubans are reported to be licensed to work in
low value-added jobs such as tailors and seamstresses, there are many
constraints, Gonzalez-Corzo told the University of Miami's Institute for
Cuban and Cuban American Studies (ICCAS).

An "onerous tax system" piles "taxes upon taxes upon taxes" that make it
difficult for the new micro-enterprises and "confiscate the limited
prosperity that people are generating," he said.

There's a shortage of appropriate retail space needed for the new
businesses, property rights remain largely unclear and government
inspectors often look for bribes, the professor added.

The cooperative sector is not doing as well as projected by the
government, Gonzalez-Corzo said. And the average bank loan approved
under a micro-credit program designed to help the private sector stands
at about $55.

State payrolls have been cut by 500,000 — government officials have
spoken of a need to lay off at least 1.3 million state employees — but
part of the drop was the result of emigration and retirements, the
academic said.

Retired World Bank consultant Carlos Quijano said the government's
announced hopes of obtaining $2.5 billion in foreign investments in
order to be able to generate moderate economic growth seem far too
ambitious.

Cuba now has an estimated total of $500 million in foreign investments,
Quijano said, compared to $16 billion for Costa Rica and $17 billion for
the Dominican Republic – two other relatively small Latin American nations.

Quijano also said there are three economic tendencies on the island:
"statists" who want to largely retain the current model; "economicists"
who favor some type of market socialism; and democratic socialists who
favor broader use of cooperatives.

Brian Latell, a retired CIA analyst and senior research associate at
ICCAS, said the island today appears to have more social stability than
at many points in the past. And there seems to be little possibility of
a mass exodus such as the Mariel boatlift in 1980.

Cuba's ruling elites know they have to modernize the Soviet-style
economy "but fear a modernization because it might lead to rebellion,"
said Juan Antonio Blanco, head of the Center for Latin American and
Caribbean Initiatives at Miami Dade College.

The island "is a poor, technologically backward country at the margins
of the new digital age of globalization and knowledge economies," added
Blanco, a former analyst with the Central Committee of the Communist
Party of Cuba.

Also addressing the seminar were Florida International University
professor Marifeli Perez-Stable; Frank Calzon, director of the Center
for a Free Cuba in Washington D.C.; and Pedro Roig, senior research
associate at ICCAS and former Radio/TV Marti director.

Source: "U.S. academics say Cuban reforms not going well - Cuba -
MiamiHerald.com" -
http://www.miamiherald.com/2014/05/10/4109734/us-academics-say-cuban-reforms.html#storylink=misearch