Updating Cuba’s Economic Model

[joshcryer]

http://www.cubastudygroup.org/index.cfm/files/serve?File_id=9d55dbce-15d3-4e08-931e-c57912f42437">Updating Cuba’s Economic Model
Cuban authorities have repeatedly claimed, as early as 2007, that structural problems should be solved as soon as possible, since they prevent any possibility of growth. It is precisely this argument, in combination with objective and subjective factors in the direction of the economy that have promoted “the updating of the Cuban economic model.” At the same time, we should not ignore that as early as the 90´s there was a prolific academic body of work that supported the need to make deeper changes in the Cuban economy.

The structural problems of the economy have been strongly debated, at least in the financial area for the last 15 years, including the lack of hard currency, distortions of the price system resulting from the overvalued official exchange rate, lack of convertibility, monetary duality, segmented markets, poor performance of the “real” economy, and in particular the sugar industry and agriculture, and the efficiency issues affecting public entities.

But the time spent in the socialist project, plus the analysis of the experiences of other Asian socialist countries, places on the Cuban government the urgent imperative of updating its own economic model, where the market must have an ever-growing role in the economy, even while the model of economic management that will prevail is central planning, but taking the market into account.

...

It has been accepted that the government may assign nonstrategic activities capable of absorbing the large number of workers that will be available in the next few years, as a result of the new reorganization underway in state enterprises and budgeted units, where the numbers of workers to be relocated will be between 1 and 1.3 million for the first period. The first period began in 2011 and will make 500,000 government workers available.

Fascinating article, utterly fascinating direction the Cuban Economy is going in. Related is http://vimeo.com/23512592">this Q&A on the economy (en espanol). And this further essay by the Cuban who made this article http://www.americasquarterly.org/node/2450">here.

Note about the source, it is Cuba Study Group, I do not know their affiliations outside that they are market-oriented. However, this is a translation of Omar Everleny Pérez's talk in New York (which the video links to the Q&A), so I have no reason to doubt the veracity of the paper. I could not find the original presentation in Spanish. I'd be grateful if anyone else could find that (since it may have more graphics or whatever than this short watered down variant).