Economic impressions from Cuba

Economic impressions from Cuba



Share I postponed my economic impressions of Cuba to write about the

Nobel economics prize and the late Turkish economist Ali İhsan Gelberi.

I was also working on how to make an argument that the Cuban economy is

doing well. In the end, I just gave up.



Not that I would have done a bad job. For one thing, I know a lot about

distorting and manipulating economic statistics from reading Turkish

Finance Minister Mehmet Şimşek's tweets. I would not have needed to

falsify much data anyway: I could have pinpointed that Cuba is higher on

the Human Development Index rankings than Turkey because of its more

educated population and higher life expectancy.



I would not even have needed to resort to hard data. I could have argued

that Cubans were miserable before the Revolution by showing Cuban artist

Carlos Enríquez's sarcastically-titled painting "Campesinos Felices"

(Happy Peasants), or his compatriot Marcelo Pogolotti's "El Cielo y la

Tierra" (The Sky and the Earth) - both at the Museum of Fine Arts in Havana.



But at the end of the day, you don't need to be an economist to figure

out that the Cuban economy is not doing well; a stroll for a few hours

in the capital will be more than enough. For example, you'll see a state

shop selling ice cream for only 1 national peso (4 U.S. cents), whereas

old-style air conditioners are 400 convertible pesos ($400) next door,

and an old man right outside on the street has a string of onions for $8.



These price distortions are a byproduct of not only the command economy

but also of the large wage disparity created by the country's dual

currency regime I outlined in my Oct. 14 column. Cuban officials were

well aware of the problem and had voiced their intentions to end this

odd system. I was therefore not surprised when the Communist Party's

official newspaper Granma announced on Oct. 22 that a new unified

currency would be phased in.



The dual currency is not the only quirk of the Cuban economy. After

visiting the Revolution or Fine Arts museums, or maybe stopping for a

Papa style daiquiri at Floridita, walk west for a couple of blocks and

you'll hit the world's weirdest property market on Paseo de Marti. Since

2008, Cubans can buy or sell residences, but the agents are illegal.

Therefore, hundreds of people gather on this promenade to form an

open-air real estate market.



You'll also make grimmer observations. I must have grabbed a few kilos

of soap and shampoo from the hotels I stayed at, as beggars ask for

those as much as money. Sex tourism is quite prevalent. In two of the

four hotels I stayed at, I saw Western men with Cuban girls who are

probably younger than their daughters, or in some cases granddaughters.



The government is pursuing reforms, albeit sluggishly. Small enterprises

are being encouraged and cooperatives have been introduced in several

sectors. Given the collapse of the Soviet Union into corrupt oligarchies

after big-bang reforms, this gradual approach may not be such a bad

idea. But Cuba just doesn't have a lot of time.

October/25/2013



Source: "EMRE DELİVELİ - Economic impressions from Cuba" -

http://www.hurriyetdailynews.com/economic-impressions-from-cuba.aspx?pageID=449&nID=56791&NewsCatID=430