Initial interest in Cuba's economic roadmap quickly turns to indifference

Initial interest in Cuba's economic roadmap quickly turns to indifference
By JUAN O. TAMAYO
McClatchy Newspapers
Published: Monday, May. 16, 2011 - 5:19 am

MIAMI -- The latest version of Cuba's roadmap for its most ambitious
economic reforms in 50 years has added a call for expanding the use of a
Western-styled management system - and a call for state controls on some
food prices.

But the so-called "guidelines," approved by the ruling Communist Party
Congress last month and published May 9, remained little more than a
wish-list that the Raul Castro government can adopt or sidestep,
depending on circumstances, analysts said.

"It clarified many points, but it's still very general, raising more
questions than answers," said Oscar Espinosa Chepe, a dissident Havana
economist who has compared the party-approved version and an earlier one
made public in November.

Many Cubans made a beeline for the newsstands last Monday to buy copies
of the 48-page publication, and early buyers even re-sold them at three
and four times their face price. But by Friday stacks of the report
remained on the shelves, said a Havana retiree.

"There was an initial rush, but now people realize there's little new
there and they are indifferent," said the retiree, who asked to remain
anonymous because he was not authorized to talk to foreign reporters.

The guidelines were designed as a roadmap for Castro's plans to rescue
the Cuban economy by slashing state payrolls, easing central government
controls and allowing more private enterprise, among other reforms.

But some of the changes from the first to the last version appeared to
reflect decisions to move faster or slower, to allow more or less
private enterprise, to reduce or expand central government controls or
planning.

The latest version, for example, removed a line saying there should be
no price controls on the food grown by a new type of private farmer,
noted University of Pittsburgh economist Carmelo Mesa-Lago.

Instead, the item now calls for the government to set the prices for
food that Acopio, the notoriously inefficient state agency that buys,
distributes and sells farm products, buying from private farmers who
lease fallow state lands.

"This is a radical change back to government controls," said Mesa-Lago,
regarded as one of the top experts on the Cuban economy.

In other changes, the words "control" and "planning" have been added to
several of the latest guidelines, he noted. One key guideline already
declares that Soviet-styled central planning - not the market - will
continue to guide Cuba's economic development.

Espinosa noted that the latest guidelines also retain a ban on "the
accumulation of property," in essence a warning that the new private
enterprises - whether farmers or brick makers - will not be allowed to
grow too wealthy.

On the plus side, he added, they include a new call for the broader use
of perfeccionamiento empresarial - a Western-style management system,
based on audits and other controls, now employed in many of Cuba's
military-run enterprises.

It also makes it "very clear," Espinosa said, that the government plans
to move ahead with its effort to lay off more than 1.3 million state
workers - in a country of 11.2 million people - and cut subsidies for
items such as the food ration card.

The first round of 500,000 layoffs was to have been completed by April
1, but Castro postponed it amid widespread grumbling. The removal of
several items from the ration card also has drawn complaints, especially
from Cuba's poor and elderly.

Espinosa and Mesa-Lago noted other pluses in the latest guidelines:

-A call to ease the currently ultra-tight regulations on buying and
selling homes and cars. That would legalize a large number of deals now
negotiated on the black market, and allow the government to collect
taxes and fees, Espinosa said.

-A vague call to study the possibility of allowing more Cubans to travel
abroad "for tourism." Cubans currently need a difficult-to-obtain "exit
permit" before they can travel abroad for any reason.

-A mention that the recent law covering the leasing of fallow state
lands to the new private farmers could be changed as needed. Some of the
new farmers have complained about government regulations and the
bureaucracy.

The roadmap also lists "a lot of good intentions" like the elimination
of Cuba's unwieldy dual-currency system, a recovery of the island's
exports and reduction of imports, Mesa-Lago added, "but offers no idea
how those things will be accomplished."

Espinosa said he perceived in the guidelines a thinly varnished
criticism of Fidel Castro policies that led the island to economic
stagnation, and far-too-modest proposals to move the country toward a
more productive system.

"They are applying penicillin," he told El Nuevo Herald in a phone
interview from Havana, "but this is a critical situation."

To the Havana retiree, for many years a strong supporter of the Fidel
Castro revolution, the new guidelines, like the first ones, are nothing
to celebrate.

"There's nothing concrete there," he said by phone from his home. "This
country has already seen too many lies. The people no longer believe in
anything. And the coffee pots are exploding again."

What?

Back in the 1990s, at the height of the economic crisis unleashed by the
end of Soviet subsidies, the government sold Cubans a cheap mix of
ground coffee and chickpeas. The mix somehow clogged the filters of the
espresso coffee pots, making them explode.

As the crisis eased, the government stopped selling the mix. But last
month it announced that the coffee sold under the ration card would
again contain chickpeas because there was not enough money to import
sufficient coffee beans.

"Some people want to see reforms and advances (in the guidelines) that I
just don't see," he said. The exploding coffee pots "are a symbol. The
government promised the chickpeas in the coffee would not happen again.
They promised to make things better."

http://www.sacbee.com/2011/05/16/3629770/initial-interest-in-cubas-economic.html