Some finding success in new free-market Cuba

Posted on Sun, Apr. 10, 2011

Some finding success in new free-market Cuba
BY PAUL HAVEN
Associated Press

HAVANA — There was no colorful bunting to mark the grand opening, and no
way to advertise in the local press. There was not even money to hand
out fliers in this decaying Havana neighborhood of potholed streets and
crumbling one-story homes.

So when the freshly painted front window of the tiny pizzeria swung open
on the most important afternoon in Julio Cesar Hidalgo's life, nobody
noticed at first.

Hidalgo and his girlfriend, Gisselle de la Noval, waited for half an
hour, then another, and another. Finally, 92-year-old Estrella Soto
shuffled up to the takeout counter and ordered a medium pizza with onion.

"I love it," she declared, and Hidalgo and de la Noval have barely sat
down since.

They sold seven more pizzas in the next 15 minutes, and a total of 30 on
their March 8 opening day. The following Saturday they had their best
afternoon yet, churning out 60 pies from a used gas oven that looks too
narrow even for a small family's needs.

It has been six months since President Raul Castro opened this tightly
controlled communist country to a smattering of free-market capitalism,
in the most significant change to its economy in decades.

By March 8, entrepreneurs had taken out more than 171,000 business
licenses, according to state-run media, more than two-thirds of the
250,000 goal for all of 2011.

As Cuba's new business class journeys cautiously forth, some are
enjoying the first fruits of success. Others say the terrain has been
rockier than anticipated. Some have already closed the door on their
entrepreneurial dreams.

The Associated Press began following the fortunes of a group of would-be
small business owners in December. Four months later, their experiences
seem to reflect the sweep of Cuba's grand experiment, as well as the
sometimes cruel vicissitudes of the free market.

There is Javier Acosta, who is struggling to get customers into his
upscale Havana restaurant. And Yusdany Simpson, a young single mother
making a modest income selling coffee and sandwiches from her front
yard, a humble venture that resembles a child's lemonade stand.

Then there is Danilo Perez, a 21-year-old bookkeeper who got a license
to sell pirated DVDs, only to give up bitterly after authorities
suddenly quadrupled his taxes.

"Cubans are entrepreneurial people and to the extent they are allowed to
work and make some money, they will," said Lorenzo Perez, a former IMF
economist and member of the Association of the Study of the Cuban
Economy, a nonpartisan Washington, D.C.-based think tank.

But he added the new enterprises face stiff challenges in a country
where few have business acumen, raw materials are hard to find, tax
rates can be exorbitant and myriad government regulations still restrict
basic activities.

http://www.kansas.com/2011/04/10/1801655/some-finding-success-in-new-free.html