Before Z come A, B, and C

By Elsa Claro

Will private individuals be allowed to import?

The question appears in a news item filed from Havana by an experienced correspondent, in a preview of the changes coming to Cuba.

He is not the first person to ponder it. As the saying goes, the question has been raised by citizens “from Cheíto the Lame to Juana Bacallao.” On the street, one hears comments that may not have the passion inspired by a baseball game but that encapsulate the concern of those who suddenly find themselves before a crisis forgotten by some (for people over 50, the possibility of losing their jobs) and unclear to others.

The list of questions could be long. Credits will be made available to those individuals wishing to create microbusinesses that employ salaried workers, as President Raúl Castro told the National Assembly, but with what criteria and how efficiently will the state provide supplies to the brand-new entrepreneurs or cooperatives?

Several activities will permit the purchase of various products in stores, in convertible currency, but the prices will impinge on the services provided, making them not very competitive. It is well known that activities of a certain volume require wholesale prices.

Cuba’s disadvantage is that it is an island. Everything must come on a ship or plane. Despite that, there are businesses “under the counter” (they don’t pay taxes and other requirements that hereinafter will be closely watched, as in any country that respects its fiscal laws) that utilize equipment of questionable origin.

It cannot be ruled out that diverse goods will arrive (the fruit of a family effort or exporters, why not?) with the proper Customs OK and legal papers, and that those goods will compete with the offer from state-run stores.

In October, about 460,000 new licenses will be issued for about a hundred activities that can be performed either individually or in groups. Nine of them are not offered at present because it is impossible to guarantee the materials.

Several experts from the Cuban Economy Studies Center said that among the existing problems is the decline suffered by investments in the period 2007-2009. They also pointed to the need to energize the productive spheres, in search of better output through better technological and organizational capabilities.

Reliable sources tell us that investments will soon be made in industry and tourism. That will mean the creation of jobs for some of the 250,000 people who in the next six months will be laid off from jobs that have been subsidized.

The elimination of prohibitions (for example, a producer mustn’t commercialize his products, or a private group mustn’t work for, or sell to, the state) will be an interesting activator. Also, the possibility that floor space in stores or buildings can be rented for the display and sale of different goods (be they furniture or shoes) is encouraging.

Here’s another detail to be considered. While for many years local solutions have been sought to a large number of issues, seeking to avoid unnecessary expenses in the conveyance of goods along long roads or through unsafe regions, from now on each site will be encouraged to decide what it needs and how best to satisfy its needs.

On one hand, requirements are lifted (such as a municipality’s limits on the issuance of licenses) and on the other the state continues to improve everything that will prevent unnecessary importations and encourage the productive sectors, all the while removing the paternalistic ballast that has created a pernicious mentality and prevents the elimination of equal pay for everyone. 

“I am sure that people will learn to respect work,” said to me an old and dear friend, a constant critic of the excessive kindness that led people to consider going to work a favor.

An observer who is farther from the land of palm trees, Phil Peters, an expert on Cuban issues at the Virginia-based Lexington Institute, said that “There are a lot of options: foreign investments, self-employment, cooperatives, small and medium enterprises. They all produce more jobs and fiscal revenue, a lighter load for social well-being and a smaller black market.”

That is true. Even the accountants, in the past eliminated because of a Quixotic myopia and recently well-respected, will have a diversified and notable role in the scheme of economic renewal, because the tax system that accompanies all changes will demand it.

“We have more than 304,000 workers, 70,000 of whom will have to be retrained,” said Domestic Trade Minister Jacinto Angulo Pardo. “That will be done in five years, in a gradual process, as part of the reordering of the entrepreneurial system, the commercialization network, and the work models. Its objective is to relieve the State from excessive expenditures and improve efficiency,” he said, summarizing some of what has already been done – and not only in his ministry.

Where will those people go? Each official organization will offer them three job options in the same workplace or in establishments that are adjunct to the organization. In general, the job offers unrelated to the organization being trimmed involve education, law enforcement, construction and agriculture.

Among several projects regarding agriculture are the recent facilities for the sale of products. An accord issued by the Council of Ministers on June 24, 2010, authorizes “the commercialization of agricultural products in points-of-sale or kiosks located in areas next to major roads or highways.”

Regarding coffee-producing areas, the accord envisions their capital rehabilitation with investments, loans to farmers, and new concepts, such as eliminating voluntary work (which could be used only in emergencies) and the conversion of many of those plantations, which have already been stimulated with higher prices, into cooperatives.

Still to be tested are the restaurant cooperatives, which can offer direct service to the consumers or provide catering for business companies, including official enterprises. Also to be tested are janitorial and maintenance services, carpentry shops, canneries, food production centers, laundries and a large and productive “et cetera” that, like the spontaneous yawn or laughter, are as healthful as opportune.