Cuba currency reform will take 3 years - ex-minister

Cuba currency reform will take 3 years: ex-minister

AFP



The unification of Cuba's dual currency system will take at least three

years, the architect of the unpopular two-decades old policy of using

dollars and convertible pesos has said.

The government announced last month that it would phase out the existing

system as part of President Raul Castro's gradual attempt to streamline

Cuba's Soviet-style economy.

Under current rules, a minority of Cubans who have dollars can buy

convertible pesos (CUC) at a one for one rate, and use them to buy

scarce goods in well-stocked special state stores.

Cubans' salaries, however, are paid in non-convertible pesos (CUP),

which are valued at 24 to a convertible peso and do not go far in a

country where builders, teachers and doctors, for example, are paid $20

a month.

Amid uncertainty about when the change will happen, Jose Luis Rodriguez,

the communist state's minister of economy and planning between 1993 and

2009, said it would take time to devalue the exchange rate.

"This process will likely take at least three years," he said, referring

to the need to first devalue the exchange rate for business

transactions, and then secondly for private individuals.

Rodriguez said currency unification would "create the conditions for

better management and measurement of the economy," but it involves a

"profound structural change" for those providing goods and services in

the country.

The government established the current system to steer hard currency

into its coffers which it needs to buy bulk food on international

markets for the country's 11 million population.

While Cubans enjoy almost free education and health benefits, housing

and a subsidized food basket, most say they still struggle to put food

on the table.



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