by Mimi Chakarova
Heat waves rising from the
cracked pavement make the red flower print on a plastic bag shimmer.
A bored teenager, the third in line for a public phone, shifts impatiently,
her lemon-yellow Lycra top glaring bright in the sun. Second in line,
a man in a baseball cap checks her out, but settles his glance on the
tourist fumbling in her huge American backpack for change, a credit
card, or whatever these Cuban phones take.
"Where are you from?
Spain?" he asks, without waiting for an answer.
"Where are you staying?
When he finds out where, and that I'm paying $15 a night, he laughs
and rolls his eyes.
"I can offer you a
room for much less
Close by, a block and half, maybe two. Come
Welcome to Cuba. The public
phone takes only dollars. So does the portly hot dog vendor taking advantage
of the phone line to sell ice-cold TuKolas Cuban Coke
and Havana Club Rum. So do the neighborhood kids, who give a lost tourist
directions for a dollar fee, and the cab driver, who won't take Cuban
pesos even as a tip. They want dollars. So, in fact, does the
This may still be Castro's
Cuba, but the evils the Revolution came to vanquish the dollar,
tourism, private enterprise and inequality--are pushing through the
widening cracks brought by the fall of the Soviet bloc.
Described by Castro as a
necessary evil, these small allowances to capitalism are taking root
and seeding change at every level of Cuban society.
was like giving an asphyxiating patient a breath of oxygen,"
says Marta, who rents rooms in her house. "First, he recovers.
Then he wants more."
The advent of the dollar
and private enterprise means that the worker's paradise now has winners
and losers. Staying close to the party line and putting in a few hours
in a state-owned company for a peso salary no longer guarantee a good
living. This is a new game, and the one with the most dollars wins,
whether the money comes from hard work or from relatives abroad. Surprised,
Cubans are seeing the other face of government. In addition to public
service, which in Cuba includes health and education, the government
also taxes the entrepreneur and competes against businesses for tourist
dollars. Still, even with tight regulations, a little taste of economic
freedom goes a long way.
"It was like giving
an asphyxiating patient a breath of oxygen," says Marta, who rents
rooms in her house. "First, he recovers. Then he wants more."
To get more, Cubans everywhere,
in legal businesses and in underground markets tweak the rules and cheat
the state. Highly educated Cubans have dumped low paying professional
jobs to work in tourism for dollar tips. In the race for dollars that
followed economic reforms in the 1990s, Cubans use what they have: they
rent their houses, sell the country's communist appealChe beret'
and tee shirts--and invent a thousand ways to stretch what little income
During the special period,
as Cubans call the economic mess they have been sorting through since
the dissolution of the Soviet Union in the early 1990s, the easy credit
and cheap oil coming from the Soviets dried up. Cuban sugar, which had
been sold at artificially high prices, found no buyers, and the island's
fragile economy, fed on subsidies and barely standing on its old sugar
and tobacco legs, collapsed.
"With the demise of
the Soviet Union, we had to change, says Antonio Ravelo Narino, a Cuban
economist. "It was like a wedding; if one person dies, you can't
expect the other to go on living with the dead. We were trying to live
with the dead."
The government opened the
island to tourists and their dollars in the early 1990s, but that was
not enough. To control spiraling inflation, the threat of unemployment,
and a grinding depression, Castro gave in to what was already happening
in black markets and inside homes all over the island: he legalized
the possession of dollars. He also allowed small private enterprises
to flourish under tight regulations and permitted foreigners to invest
in mixed ventures.
"If we hadn't been
allowed to fend for ourselves, put up our businesses, things would have
exploded," Alejandro, the hot dog vendor by the payphone explains
as he polishes the shiny aluminum countertop.
If Cubans had to scramble
for hard currency to survive, so did the government. When tourist dollars
were not enough to pay expenses and service Cuba's $22 billion foreign
debt, the government looked for ways to cash in on the remittances that
relatives abroad sent to Cubans on the island. The answer was government-owned
dollar stores. These quickly appeared on every corner, selling everything
from Italian biscotti to television sets. The majority of Cubans, however,
still lived on pesos, and with an average wage of 240 pesos about
$12 dollarsno one earned enough. An average family needs at least
$50 a month to survive, so by the mid-1990s Cubans everywhere went into
the streets to make up the difference between their peso salary and
the dollar reality.
"This is the land of
magical realism," Fernando explains on the way to showing me the
room he has for rent. "Incredible things happen every day so that
people can go on. People invent."
Inventing a living is how
engineers like Fernando end up on a Havana sidewalk convincing a tourist
to follow him home. His is the story they all tell: his peso salary
in a management position with a state-owned company was never enough,
and since the legalization of dollars in 1993, he has been earning his
dollars any way he can--selling instant photographs that he takes of
couples in restaurants, renting pirated videos, and sometimes renting
a room in the home he shares with his sister. Inventing.
by Mimi Chakarova
He has no license for renting
rooms, but like many other Cubans, Fernando has mastered the tight-rope
walk between punishable illegalities and everyday infringements that
most officials ignore. Renting videos was not one of the categories
of self-employment that the government legalized in 1993, but from the
second floor in one of Havana's old mansions, with soaring twenty-foot
ceilings, peeling paint and faulty plumbing, Fernando makes his own
rules. One tape goes for 25 cents, a bargain next to the official government
rentals--$5 a membership and $1 per rental. What's really priceless
is the selection: while state-owned video rentals limit the movies available
to those that have been officially sanctioned, Fernando's solid wood
china cabinet offers a range of new releases that rivals Blockbuster's
shelves: Terminator, Crouching Tiger, Hidden Dragon, and
300 others. Cubans, he explains, as he flips from channel to channel
through a pirated satellite hook-up, prefer action and violence. He
stops at the Playboy channel. "I don't record this stuff. A government
official might look the other way if his kids are watching rented movies,
but if they start watching pornography, then he might want to find out
where it is coming from," he says, shrugging off the question about
what would happen if he were caught.
"When ordinary things
become crimes, then you make an ordinary man a criminal," he says.
The television set flickers. Urban Legends, a popular series,
comes on. He starts recording.
Not all private businesses
on the island are outside the law. Currently there are 150,000 legal,
licensed businesses in Cuba, ranging from shoe-shiners and plumbers
to small restaurants and private homes that rent rooms to tourists.
A few chosen occupationsinitially 110, now 157--opened up for
private enterprise in fits and starts. The number varies according to
"The government tries
to limit this sector as much as possible" says Roberto Orro, a
Cuban economist now living in Puerto Rico. "It had to accept it
because there was no other option, but it was certainly against its
will. There are people who are not politically faithful to the government,
and now those people have the possibility of obtaining a certain economic
Paladares, for example,
the tiny restaurants named after a canteen in a Brazilian soap opera,
were ordered shut in December 1993, with Castro accusing the owners
of the still tax-free establishments of illicit enrichment. The need
to create employment and jump-start the economy forced the restaurants
open again weeks later. They operate under tight rules and close inspections
by several government agencies that have the right if not the
manpowerto check everything from hygiene to tax compliance.
These regulations squeeze
many legal businesses underground. Once they disappear from government
lists, the businesses that give street life in Cuba its flair1950s
taxi cabs, food vendors, cigar hawkers flourish without taxes
or regulations, making enough money to pay the occasional fines and
still make a comfortable living.
Meanwhile, legal paladares
can only serve food bought at government-owned dollar stores at retail
prices. The rules say receipts must be kept handy for frequent monthly
inspections that come any time between 5 am and 10 pm. The establishments
are forbidden from having live entertainment, and must stay away from
main streets and popular tourist hubs. But it is difficult to know to
what extent these rules are respected, since even legal businesses seem
to follow some of the rules and ignore others.
squeeze many legal businesses underground. Once
they disappear from government lists, the businesses that give
street life in Cuba its flair 1950s taxi cabs, food vendors,
cigar hawkers flourish without taxes or regulations, making
enough money to pay the occasional fines and still make a comfortable
Take Fernando's favorite
paladar in Santa Fe, 40 minutes west of old Vedado, past the upscale
oceanside neighborhood of Miramar, and far from where most tourists
stray. We get to the seating area in the backyard by walking under the
front hedge, along the house, and through the patio where dozens of
caged parakeets hang amid ferns. When we emerge from the ferns, we run
into the restaurant owner, who stands elbow deep in blood, dissecting
fresh chicken. She prefers not to give her name.
are our clients," she says, explaining why no visible sign hangs
at the front. Her sister, squatting on the floor, inspecting buckets
of chicken parts, is more direct: "Unnoticed, we do much better
than by calling attention to ourselves."
A quick glance around shows
why the two sisters want to keep their secret: the first rule for paladares,
no more than 12 customers at a time, is disregarded. This place has
12 tables. A restaurant this busy also needs many employees, which according
to rules, should all be family members.
"Well," says the
owner, laughing with her knife in hand. "It is as if we were all
a big family. Everyone puts this address in their identity booklets,
so that when inspectors come
I wonder if all that chicken
was bought from a government dollar store, as mandated by the law. These
are fresh, not frozen, and in residential areas like this, a quick stroll
is long enough to spot chicken scratching in the backyard, or the unmistakable
whiff of a home-grown pig.
by Mimi Chakarova
A scene from
a Cuban market. Currently there are 150,000 legal, licensed businesses
in Cuba, ranging from shoe-shiners and plumbers to small restaurants
and private homes that rent rooms to tourists.
A few feet away from the
owner, on white plastic tables facing the ocean, the guests enjoy fried
chicken and the breeze for just a handful of dollars. Far from tourist-heavy
Havana, this place caters to Cubans who have thrived in the changing
economy. The prices are lower than downtown-- $2.50 for rice, beans,
fried bananas, and fried chicken -- but still in dollars. The owners
have also done well, and the temptation to do even better is hard to
To attract business to state-owned
restaurants, the government does not allow paladares to serve seafood.
With the ocean a few feet away, and family member working as fishermen,
the two sisters are proud to point out that this is one rule they respect.
"There are those who take the risk, but we try to stay safe,"
the owner says. "So many of them have been shut down, but we are
As with Fernando's video
business, the secret of surviving lays in knowing which rules must be
respected, and in having a friendly relationship with your inspectors.
Watching the sisters, Fernando tells me about a friend who rents rooms
without a license, and pays his neighborhood inspector $50 a month to
get away with it. "One month, he didn't have enough. He told the
inspector, and immediately the man started naming the infractions he
was committing: renting a room, serving food to foreigners without the
proper sanitary precautions
My friend ran out and borrowed the
money really quick."
At an open-air market by
the Malecon, Havana's main seaside walk, William, a sculptor, echoes
these concerns. As he talks, he whittles ebony into the slender figures
of Cuban guajirospeasantsand naked mulattas he sells to
"They didn't tell you
to close down, but when they saw people were getting ahead in life,
they started to force you to close: taxes went up all the time, until
you were barely making a living, and the inspectors came at any time
of the day to see if all the people working have licenses."
William and his brothers
make a handsome living, finishing the month with more than $100 each
in a country where the average wage is $12. However, like other Cubans
who first experimented with profit a few years ago, he found taxes and
regulations to be an unpleasant yoke. In 1992, when he and his brothers
first started selling the sculptures they made as a hobby, they paid
nothing to the state, since what they did was illegal. In 1993, selling
arts and crafts was legalizedand soon the tax hikes began, from
$2 a month in 1993 to $159 a month, plus a $3 a day fee for using the
market. The monthly tax is fixed, independent of earnings, and another
year-end tax is based on revenue.
Other businesses also pay
taxes unheard of a few years ago: to rent a room to tourists in Vedado,
the homeowner pays a monthly tax of $250 per room; to run a private
cab that charges in dollars, the taxi driver pays $225 every month.
"Nowhere do people
pay taxes like this," William says, shaking his head in frustration.
It is hard to tell whether
William is really overtaxed, or just unfamiliar with the way capitalist
countries work. Even if they pay over half their income in taxes to
the government, Cuba's budding entrepreneurs are still making a killing
relative to others on the island. Williams complaints about taxes have
a familiar ring: he sounds just like small business owners everywhere.
He just doesn't know it.
"There is no small
business culture in Cuba," says Mayra Espina, a sociologist with
a prominent research center in Habana, the Centro de Investigaciones
Psicologicas y Sociologicas.. "They don't know how it works in
other countries, and they feel they are being strangled by taxes and
rules. When small businesses sprang up in Cuba illegally they had profit
margins of 500%; now, with 200% gains, they think they are suffering.
This doesn't mean the government isn't tightening the screws, but of
course they also have to contribute to the state, and follow rules like
In spite of their ingenuity
and flexible understanding of regulations, Cuba's entrepreneurs are
"a sector on the defensive," says Gillian Gunn Clissold, a
professor at Georgetown University. "The Cuban government has become
much more fierce about self-employment. It definitely is tightening
restrictions and imposing new ones." Santa Fe alone had 22 paladares
in the mid 1990s, when self-employment had just been authorized, and
Cuban families began to dream in dollars. Now there are only two. The
government is not issuing any more licenses for room rentals or paladares.
And this neighborhood is no exception.
by Mimi Chakarova
never fully accepted by the government," says Espina. "They
saw it as a necessary evil, and the tension continues. When self-employment
goes up, there is always a reaction: taxes go up, inspections are more
rigorous, permits are no longer issued."
Legal self-employment in
Cuba has decreased at a rate of about 600 businesses a month for the
last three years. Of the 200,000 licensed businesses in 1996 only 151,000
remain, according José Luis Rodríguez, the Cuban minister
of the Economy. Some, like the owners of the paladar in Santa Fe, say
the ones forced out failed to follow rules. Others, like William, the
sculptor, feel the government is methodically squeezing the life out
of the sector through tax hikes and a draconian enforcement of existing
Legal businesses may be
closing, as government officials say but they might be simply
slipping off the official rolls, out of the government's grasp, and
into the island's booming underground economy, where no one pays taxes,
and the only rule is to stay in business. Flourishing illegal enterprise
helps Havana feel far from depressed. "There are a lot of people
doing this illegally," says Eugenio Espinosa Martinez, an economist
with FLACSO-Cuba who teaches in the University of Havana. "No one
knows how many, but you see them all over town."
In fact, any conversation
with a restaurant owner, or a stroll down old Havana's cobblestone streets
will show that even Cuba's legal businesses exist on both sides of the
law. Just about any curb-side stall offering sandwiches and pizza harbors
examples of the ingenuity that allows Cubans to survive. Instead of
buying all his wood from government supply stores, William, the sculptor,
whittles some of his figurines from the banisters and roof beams taken
from old Havana's crumbling mansions. The taxi driver who takes a tourist
home at night is likely to ask him to agree on a price beforehand, to
avoid turning on the meter: "You pay less to me, I make a little
extra money." Gisela, who rents rooms in her home, doesn't declare
all the rooms she has for rent.
Joaquina, a sociology professor
at the University of Habana who also rents rooms to make ends meet,
explains, "This isn't the black market; there is nothing hidden.
It is the market. Period." She started hosting foreigners during
the special period, "right around the time when even toilet paper
was scarce. I decided we'd had enough."
Her husband, Bienvenido,
is a sailor, and returned home from his trips with food and clothing
that the family could later sell to neighbors. Paying under the table
with black market money, they moved their four-person family to a five-bedroom
apartment with two bathrooms. More sailing brought more goods for sale,
and they bought beds. Soon they had a profitable bed-and-breakfast that
caters to the visiting professors and scholars Joaquina meets through
isn't the black market; there is nothing hidden. It is the market.
In 1993, as soon as it was
possible, she legalized her business, and now pays the necessary taxes.
Her business is perfectly legal, but talking over breakfast, she explains
the web of small illegalities and daily infractions that she and others
participates in. Take the bread, she says, pointing to one of tasteless,
crumbling rolls Cubans buy at a subsidized price. "The bakery workers
stretch the government rationed flour and oil, making bread that weighs
just a little less than it should," she says. "At the end
of the day, they make extra loaves, which they sell for a profit to
people like me."
While she talks, the doorbell rings. The neighborhood pharmacist is
delivering her daughter's migraine medicine.
Home delivery, in Cuba?
"This medicine only
comes once in a while," she explains. "He knows we need it,
and that we can pay in dollars, so he got prescription from a doctor
he knows. When the medicine comes in, he brings it over. That way we
don't have to check at the pharmacy every week, and he makes a little
Joaquina and Bienvenido
established their bed and breakfast, and now live on the winning side
of the dollar divide. They can afford home delivery, weekends on the
beach with the family, and occasional dinners in one of Habana's paladares
where they drink their beers next to tourists. Like small business owners
everywhere, they needed capital to start up. In a country where credit
or loans are nonexistent, and salaries never see the end of the month,
raising money is one of the most significant barriers to establishing
even a small business like.
However, the dollars sent
by Cubans living in Miami, Spain or Costa Rica could change that. Already
the $800 million to $1.5 billion in yearly remittances supply would-be
capitalists like Fernando, who rents videos without authorization, with
seed money. He relied on money sent by his mother and brother who live
in Miami to buy the VCRs he needed to set up his video rental business.
by Mimi Chakarova
Whether the money helped
start a business or put food on the table, remittances have been a lifeline
for the economy of the country, and for the families receiving them.
When the government legalized remittances in dollars in 1993, the country
breathed a collective sigh of relief. The Cuban government used the
tourist dollars and whatever it could capture of the remittances to
service the country's debt, to buy essentials such as oil abroad, and
to keep the bare essentials of its social system in place: subsidies
on basic food items, and Cuba's renowned public health and education
"The net balance of
these measures was positive for the government," says Orro, a Cuban
economist living in Puerto Rico. "They managed to preserve the
regime, and people felt relieved."
Cubans had just gone through
the deepest depression in their history. Even the most basic necessities
had been missing, and so they welcomed remittances, foreign investment,
tourism, and all the measures taken to restore the country to some semblance
"During the special
period, we went through a phase called option zero, meaning zero gas,"
says Fernando. "Horses and mules were used even in cities."
Even today, bicycles and bicycle taxis are common means of transportation.
Cubans came close to starvation, Joaquina says. She remembers an epidemic
of scurvy in Habana, when fresh fruit could not reach the city. The
advent of the dollar changed all that. But even while they brought prosperity
to Cuba, dollars also brought inequality.
Salaries in state-owned
companies, which employ the vast majority of Cubans, are still low,
but recently teachers, police, lawyers, doctors and nurses were given
a raise. Some workers now get dollar bonuses that go from $5 to $20
as incentives to keep their poorly-paid state jobs, and to take the
edge off their frustration. Others, like Joaquina, get a monthly supply
of essential items only available in dollar stores, such as soap, deodorant
However, the gap between
the life these professionals lead with their peso salaries, raise and
bonuses included, and the lives of friends or neighbors who get $100
a month in legally allowed remittances is too deep to be affected by
a few more pesos or a month's supply of shampoo. Now, large income gaps
exist between neighbors and family members, and the relationship between
work and wage is distorted by the effortless affluence brought to some
families by the dollars from abroad.
"This is the negative
side of remittances," says Gunn, a professor at Georgetown University.
"In Cuba, you can live very well doing absolutely nothing, if you
are lucky enough to have relatives abroad. And you can work your butt
off, you can be the most industrious, hard-working, entrepreneurial
person onthe island,
but if you don't have access to dollars, your children are probably
running out of food at the end of the month. It has encouraged a mentality
that reward is not related to work."
The divide between those
with dollars and those without widens as Cubans who get money from abroad
put it to work, setting up their own businesses, and generating even
have to educate people all over again, to teach them to live in
a capitalist world, even if we are in a socialist country. Before,
after 10, 15 years working in the university, you got a car. You
had the right to a car. Now, no one gives you anything, though some
are still waiting."
"This money betters
the quality of life of those who receive it, but they create a difference
among neighbors that did not exist before," says Marta, who rents
rooms in her apartment, and also receives money from her son in Miami.
A picture of him posing beside his car is on the living room coffee
table, facing away from the enormous home entertainment system that
takes up a corner of the room. "A simple salary in pesos does not
allow people to live with these same comforts," she says. "But
I see it as a necessary evil."
Not everyone likes Cuba's
new source of income, or the dollarized economy. Those who had bet on
staying close to the party and moving up the ladder, accessing scarce
privileges along the way, felt cheated as the relatives of immigrants,
who were at best ideologically suspicious, and the island's new petit
bourgeois became the new moneyed elite. "Many saw this as a betrayal,"
says Fernando. "They saw their possibilities diminishing along
with their salary. They
wanted to be recognized for their dedication to the common project,
and many really wanted an egalitarian society."
The shift away
from old Marxist rhetoric has been difficult, Joaquina explains. The
ones who learn fast take advantage of the new system. The ones who don't,
sink. "We have to educate people all over again, to teach them
to live in a capitalist world, even if we are in a socialist country,"
she says. "Before, after 10, 15 years working in the university,
you got a car. You had the right to a car. Now, no one gives you anything,
though some are still waiting."
by Mimi Chakarova
While Cubans do their bit
of magic to turn pesos to dollars, the Government is doing the same,
trying to work its way out of an accumulated $22 billion debt while
propping up the educational and health system Cubans constantly tout
as the best in Latin America.
Cuba's strong economic performance
in the 1970s increased its access to credit from commercial banks and
international lending agencies, and the country borrowed heavily. Throughout
the 1980s, the Soviet Union subsidized Castro's island to the tune of
$4 billion a year. They also allowed Cuba to resell its surplus oil
for hard currency. As early as 1985, however, with sugar and oil prices
dropping, Cuba's situation started to deteriorate. The total debt reached
33% of Cuba's GNP, and by 1986 Castro declared a moratorium on commercial
debt and on debt owed to non-socialist countries.
As the Soviet Union disintegrated,
Cuba was left with this debt, exports that dropped 80% between 1989
and 1994, and a GDP that fell by half. Even as Cuba sank, the United
States continued to tightened the embargo.
Castro responded by opening
the island to hard currency, and he proved as ingenious as any Cuban
in devising ways to capture this bounty for the state. Now, dollars
will buy just about anything on the island, but behind every hotel counter,
every state taxi, and every dollar store is a government employee who
is paid in pesos. The greenbacks go to the government; the employee
keeps the tips.
This is also true for Cubans
who work for foreign companies doing business in Cuba. And there are
an increasing number. "The Cuban workforce is excellent,"
says Demarco Epifanio, the head of Brazil's Cuban subsidiary of its
oil company Petrobras. "But there are no links between Petrobras
and the Cuban employee; we contract them through the state. If I need
someone, I call CUPET Cuba Petroleum. I pay them, for example,
$2000 a month for an accountant. They pay the accountant maybe some
Four hundred pesos means
$18 and the government pockets the difference. The same is true
in all foreign enterprise. Employees only keep their dollar tips.
are an unusual economic tool, and one of the more curious aspects
of Castro's efforts to reap dollars for its own uses.
But to make sure it gathers
even those modest sums and remittances, the government has established
Tiendas de Recaudacion de Divisas, literally, Stores for the
Recapture of Hard Currency. That's where Cubans must go for just about
anything they need.
And even by American standards,
the prices are high: $300 for a 13" television, $30 for a table-top
fan, $5.70 for cookies and juice. The inflated prices at dollar stores
effectively act as a hidden tax on the dollars Cubans earn in remittances.
Any attempt to tax this income would simply drive them underground,
so government stores absorb these dollars instead.
"These dollar stores?,"
asks Ravelo, a Cuban economist. "They're there for those who get
remittances. The government gathers up these dollars, and with them
buys what it needs."
Of course, there are Cubans
who do not have dollars. For their convenience, the government has posted
CADECAS Casas de Cambio, or exchange boothsall over
the island. There, tourists can sell their dollars, but when Cubans
try to buy these dollars with pesos, what they get are Cuba's version
of Monopoly money pesos convertibles, convertible pesos, or chavitos,
as they are known. On the island, they are worth the same as dollars,
and can be spent at any government dollar store. Leave the island, however,
and the game's over; chavitos have no value.
Chavitos are an unusual
economic tool, and one of the more curious aspects of Castro's efforts
to reap dollars for its own uses. With these convertible pesos in circulation,
"the government does not have to sell dollars," says Espina,
a Cuban sociologist. "They buy dollars, which they can use, and
they sell chavitos, which people can still use as if they were dollars."
Chavitos came about when
the government felt the need to reward state workers with some access
to the dollar stores, but did not want to let go of the dollars it had.
"Different sectors started emitting vouchers that were worth so
many dollars," explains Espinosa. "Soon, there were so many
vouchers in circulation that no one knew which ones were valid."
It is hard for the economy
to function effectively with three different currencies in circulation,
and economists agree that this measure must be limited to the period
of economic recovery.
is preparing itself aggressively for the day the American embargo
falls," says Epifanio.
How long that will take,
however, is anyone's guess. There are positive signs: since 1995, Cuba
started informal talks with the Paris Club of Creditor Nations, which
holds most of its foreign debt. The economy has been growing modestly
at 4.4% a year since 1995 with a projected growth of 5% in 2001. Foreign
investment, another main source of hard currency, continues to grow
substantially, particularly in telecommunications, mining and tourism.
"We need to learn to
compete within the harsh reality of a capitalist world, even as a socialist
country," says Silvia Domenech, a professor of economy at the Escuela
Superior del PCC, the Cuban Communist Party's school of higher education.
Since the legalization of
dollars, Cuba's economy has stabilized, inflation has slowed, and the
Cuban peso now hovers at around 22 to one dollar. The island still needs
hard currency, and Castro needs more than just a stable economy. "Cuba
is preparing itself aggressively for the day the American embargo falls,"
says Epifanio. "If it ended today, they'd be in trouble, because
the United States would take over with people and capital. They are
trying to develop their own infrastructure so they'll be able to stand
on their own."
To build the independent
Cuba that Castro and many Cubans believe in, the country is still working
hard to bring in dollars from foreign investors, from family
abroad, or from tourists willing to exchange hard cash for the lingering
appeal of communism. Even Che Guevara's romantic image is for sale at
tourist markets, looking forever into a future that never came as Cubans
scramble in the present to balance along the dollar-peso divide. Never
mind that the $10 Che t-shirt, or a cheap reproduction of his red-starred
beret would cost the average Cuban a month's wages; this is the land
of paradoxes, and the impossible is shrugged off daily as people "invent"
ways of living in dollars while earning in pesos.
While the island braces
itself for whatever may comereal economic independence, or market-driven
globalizationCuban citizens are doing the same. Fernando dreams
of getting an American MBA, and writes asking about the GMAT and university
applications. In Castro's Cuba, he is reading Adam Smith and John M.
Keynes, soaking up his lessons in capitalism straight from the source.
Inventing himself a future, wherever that may be.
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