OPINION:Shedding public sector jobs, bolstering domestic enterprise while seeking foreign investment – does this sound familiar? Welcome to Cuba . . .
CUBANS HAVE entered a period of dramatic change with enormous implications for economic, political and social aspects of their lives, perhaps not seen since the collapse of Cuba’s old sponsor, the USSR.
With that cataclysmic break-up in the early 1990s, some 85 per cent of the Caribbean island's income vanished, marking the start of a period of extreme hardship remembered bitterly as the Periodo Especial.
Not least among the changes now deemed necessary to deal with the country’s troubled economy by President Raul Castro is the laying off of 500,000 state employees between this month and the end of March. Effectively, this ends Cuba’s official policy of full state employment, with some commentators saying these changes could even mark the beginning of the end of the 50-year socialist economic experiment for the country’s 12 million people.
The demise of communism and the Castro brothers, Raul and Fidel, however, have been predicted many times before – indeed their deaths were once reported in a US newspaper by an Irish-American journalist in 1956 shortly after they had landed in Cuba from Mexico with a small group to begin the final phase of the revolution.
Despite the scale and scope of the proposed changes, however, President Castro is anxious to insist that the essential nature of the last communist state in the western hemisphere will not itself change. A recent 32-page document outlining proposed changes, Draft Guidelines for Economic and Social Policy, emphasised that "as we update our economic model, planning will be paramount, not the market".
Preparing people for such seismic changes, Castro had said that Cuba would “fall off a cliff” if it did not make savings through efficiencies and “update” the tightly-controlled command economy. He said the economy was the first order of business for all the political leaders.
The measures are intended not only to correct the economy but to deliver improvements in living standards that ordinary Cubans have long and patiently desired. Most prominent of the changes are the dramatic shrinking of state employment; a significant expansion of the private sector; the encouragement of greater foreign investment in designated economic zones (not dissimilar to Vietnam and China, it appears); and a partial opening up of the property market, in which you may buy and sell property, but not accumul-ate.
On a recent visit to China, Cuban parliament speaker Ricardo Alarcon said: “Cuba is prepared to take advantage of China’s experience of development in reform and opening.”
China, now a major trading partner, recently signed a $6 billion (€4.53 billion) deal to upgrade an oil refinery and build a gas refinery in the southeastern city of Cienfuegos. This will process huge finds in the Cuban section of the Gulf of Mexico expected to come online this year.
More than 30,000 Cubans have already received licences to work privately as restaurateurs, mechanics, hairdressers and street vendors, for example, and for the first time such individuals may be allowed to take on employees and must pay taxes. As many as 250,000 licences may be issued eventually. Brazil, Latin America’s emerging economic superpower, has offered to share with Cuba its expertise in private enterprise.
Ordinary Cubans fear that if there is no match between jobs created in the private sector and the lay-offs, there will be a negative impact on the country’s social cohesion that full employment has delivered over the past half century. For example, it is feared that street crime, which is negligible by international standards, will rise.
Furthermore, Cubans express various degrees of anxiety as to whether they might be among the half million selected for efficiencies in the notoriously sluggish and bureaucratic state sector.
Alarm bells will also be ringing in Washington because of the potential for another mass wave of immigrants from Cuba.
Significantly, a long-awaited Communist Party Congress – the party forum which defines major policy issues and announces changes, but has not met since 1997 – has now been called for the end of April. At this meeting the proposals in the draft document and measures already taken will be discussed, and the shape of the new political order in Cuba will become clearer.
Cuba’s change in course is further hard evidence of Raul Castro’s shift away from the doctrinaire communism of his elder brother Fidel towards a more pragmatic, efficiency-socialism model. This approach was also evident recently with the state’s agreement with the Cuban Catholic Church and Spain to release more than 50 political prisoners, and with the opening of a Catholic seminary outside Havana, the first since the revolution.
All of this would suggest that now would be a fruitful time for the US to engage with Cuba, as indeed President Barak Obama promised in the early days of his presidency, which President Castro said he would respond to “measure for measure”.
However, the US economic downturn and mid-term elections have since changed the situation and the Republican Party’s control of the House of Representatives has given it sway over the powerful Foreign Relations Committee. From January, this committee will be chaired by Cuban-born, far-right Florida Congresswoman Ileana Ros-Lehtinen, best known for her visceral hostility towards the Cuban regime and other left-leaning administrations in Latin America.
In a 2006 Channel 4 documentary on the numerous attempts to kill the then Cuban leader, she was happy to announce: “I welcome the opportunity of having anyone assassinate Fidel Castro.”
So despite Cuba signalling an historic change in the state’s relationship with private enterprise, bar unforeseen circumstances it seems any likelihood of the US engaging with the new situation is likely to founder on the jagged rocks of old southern Florida émigré politics.
John Moran is an
Irish Times
journalist just returned from several weeks in Cuba