Cuban President announced the start of large-scale economic reforms -

Cuban President announced the start of large-scale economic reforms

Cuba will have only one national currency.

Cuban President announced the start of large-scale economic reforms

From January 1, 2021, only one national currency will remain in Cuba and large-scale economic transformations will be launched. This course of a special appeal to the nation was announced by the President of the Republic, Miguel Diaz-Canel.
"The Politburo of the Central Committee of the Communist Party of Cuba has decided to announce the beginning of the process of economic transformation. As of today, conditions have been created that allow us to announce that monetary unification will begin on January 1, 2021," the Cuban leader said in a speech broadcast on local television in the presence of the First Secretary Raul Castro's Cuban Communist Party.

“The single exchange rate is set at 24 Cuban pesos per US dollar,” added Diaz-Canel.

One peso less

Currently, two national currencies coexist in Cuba - the Cuban peso (CUP) and the Cuban convertible pesos (CUC or simply "cookies"). It was from the CUC that the decision was made to abandon the next year.
The convertible peso appeared in 1994 as a response from the authorities to the acute economic crisis that the country plunged into after the collapse of the socialist bloc. The CUC, whose cost was equal to one dollar, was originally conceived by its creators as a kind of "elite" currency, which was needed to purchase luxury goods (by Cuban standards, of course). In other words, to get money from wealthy citizens who have always been in Cuba. "Cookies" were also used by tourists. They were allowed to pay in foreign exchange stores. But over time, CUCs have become widespread. It was then that the artificially created currency began the first signs of problems: after all, at the beginning of its journey, the CUC was really freely convertible and was supported by the presence of foreign currency in the country. But gradually convertibility began to be lost: with the next round of crisis in the economy, the CUC turned into an unsecured currency. The ability to officially buy "hard currency" with "cookies" dwindled. The convertible peso was losing its real convertibility. As well as the previous touch of "elitism": it became possible to pay in any stores in both national currencies, and the rate was set at 24 CUP for 1 CUC.
And now, from 2021, there will be only one currency in the country - CUP. But the Cubans will not have to urgently run and turn over to banks the now useless CUC: it is planned to withdraw them from circulation gradually, at least six months are given for this process. For example, change in stores will be given only in CUP, and sellers will return the received "cookies" to banks. The population was also promised a free exchange of savings.

"These transformations are not without risks. One of the main threats is inflation, which may turn out to be higher than planned. The situation is aggravated by a shortage of goods on the market. We will not allow speculative price increases, violators will be severely punished," Diaz-Canel warned.

Conditions have been created that allow me to assure you that no one will be left without help. There will never be shock therapy in socialist Cuba, and all decisions taken will be the result of a broad public consensus.
Everyone deserves what they deserve

“We reiterate the importance of the upcoming reforms, which are designed to create favorable conditions for reforming our economic model in order to guarantee Cubans equality of opportunity, rights and social justice,” the president said.

"All this is not possible on the basis of an equalizing approach, but is possible only thanks to the interest of our population in work and the motivation of workers," said Diaz-Canel, thus revealing one of the goals of the forthcoming reforms: the authorities will gradually force Cubans to work.
Indeed, on Freedom Island, locals themselves often say that Cuba is one of the few countries in the world where you can live in peace and not work. Socialism often takes on exaggerated forms: outright loafers receive all kinds of benefits along with hard-working fellow citizens. Now everyone, without exception, will have to work.

The idea of the authorities is that gradually the number of social payments and privileges will be reduced. In the long term, it is even planned to get rid of ration cards, which are now used by millions of Cubans to buy socially important products at bargain prices. The money saved is supposed to be spent on raising wages and pensions. Thus, the population will clearly feel the need to work, because the state will not allocate money and subsidies so easily.

Source: Rossiyskaya Gazeta

11.12.2020 07:10:26
(Automatic translation)

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