Cuban Colada

Russian envoy sees stronger links in 2010

Next year will see a special effort to improve relations between Cuba and Russia, Russian Ambassador to Cuba Mikhail Leonidovich Kamynin said Friday.
Addressing Russian residents of Cuba at the Russian embassy in Havana, Kamynin said that 2010 "should be a special year in the history of contemporary Cuba and its relations with Russia," relations that began 50 years ago.
Many events will occur that "will confirm that Russia was – and is – by Cuba's side," the diplomat said, according to RIA-Novosti. Those relations "are not a result of current necessity but are the relations between partners and friends and are projected to the future."
Russians in Cuba "have become a more cohesive group, which has actively helped Russia to promote its culture and language [in Cuba], and disseminate information about our country," Kamynin said.
A cultural event followed the speech, with traditional Russian songs. Year-end gatherings like this, "unite Russia's diaspora and remind our compatriots that the motherland remembers them," said Alexander Moiseyev, an embassy adviser. (PHOTO SHOWS Russians at the gathering.)
Kamynin's words to his fellow Russian were very similar to those he delivered on Dec. 17 to representatives of the Cuban Foreign Ministry and Communist Party Central Committee during a year-end reception at the embassy.
At the time, Kamynin said that relations between the two countries have already "reached the level of strategic cooperation," as shown by the visits to Cuba of many high-ranking Russian officials and the signing of business contracts between the two governments.
–Renato Pérez Pizarro.

Fiscal czar tells of hard-currency woes

Cuba-watchers who are interested in the state of Cuba's economy would do well to read the entire speech delivered Sunday to the National Assembly by the Minister of the Economy and Planning, Marino Murillo Jorge. It is available, in Spanish, in the Foreign Ministry website.
(For background, read our Dec. 20 blog item "Economic growth only 1.4%...")
One of Murillo's first observations deals with the "marked deceleration" noted since late in 2008 "in the flow of hard-currency revenues we expected to count on." As a result, "difficulties arose in meeting the commitments made in terms of foreign payments. This situation created difficulties in our access to sources of financing."
"The most immediate problem" in 2009 was "the tense financial situation regarding hard currency," Murillo says, and "the outlook is for external conditions to remain very difficult."
Cuba's economic "Plan for 2010 has been drafted starting from the following guidelines:
• "Not to incur in hard-currency outlays in sums greater than the revenues;
• "to consider inventories as a source for the Plan;
• "to limit the new investments basically to those that generate short-term income in hard currency and replace imports;
• "to give priority to productions that generate income through exportation;
• "to reduce expenditures in the social sector, because the economy cannot withstand their large amounts."
"The existing financial commitments determine that the situation is very tense," Murillo continues, "therefore, negotiations have begun to reprogram our debts with other countries and suppliers" under "more favorable conditions," so Cuba may "meet [its] obligations under conditions that are realistic and match the possibilities of the economy."
The news agency Reuters this week checked for reaction to Murillo's statements about the foreign debt and reported that "creditors who are owned an estimated $2 billion do not expect to be paid in full any time soon."
"I see nothing in Sunday's report that indicates significant amounts of money will be generated or put aside to pay fresh debt racked up to suppliers and banks this year," a foreign businessman who requested anonymity told Reuters on Monday.
"Further, I see nothing indicating fresh money flows from current or new exports," he said. There have been estimates that as much as $1 billion has been locked up in the frozen accounts, Reuters said.
Again, Murillo's report is recommended reading for Spanish-speaking Cuba-watchers.
–Renato Pérez Pizarro.

Economic growth only 1.4%, minister says; blames 'blockade,' global crisis, hurricanes

Cuba's economy grew by 1.4 percent in 2009, even as exports and imports decreased by 22.9 percent and 37.4 percent, respectively, the country's Minister of the Economy and Planning said Sunday.
The growth was way below the 6 percent increase predicted last year, the minister admitted.
Addressing the National Assembly, Marino Murillo Jorge reported growth in the farm and cattle sector (4.5 percent), transportation (4.6 percent) and services (4 percent). Industry fell by 2 percent and trade remained unchanged, he said.
In 2009, work productivity dropped 1.1 percent, wages rose by 2.9 percent, and investments slipped 16 percent, Murillo said. He attributed the poor economic showing to the U.S. trade embargo, the global financial crisis, and the aftermath of three hurricanes that raked Cuba in 2008.
According to the official news site Cubadebate, Murillo said that the Cuban government in 2010 will try "not to incur in expenditures in excess of revenues, will prioritize the areas of production that generate hard currency and will make only those investments that help [generate hard currency] and enjoy assured financial backing."
Murillo was quoted by the Prensa Latina news agency as saying that next year "social spending will be reduced in line with the possibilities of the economy." He also said that "state responsibility in some services will be eased," a statement that may bode well for private enterprise. (For a report from Reuters, click here.)
[UPDATE: In a speech after Murillo's presentation, Raúl Castro said: "We are perfecting the process of planning the national economy and elevating the role of the Ministry of the Economy and Planning to that of the government's general staff in the management of the economy. For that reason, it is no accident that today this Assembly has elected Vice President of Government Marino Murillo Jorge to the post of member of the Council of State."]
–Renato Pérez Pizarro.

Outlook for economic development is grim

Raúl Castro this weekend is expected to announce his economic plan for 2010 after a year "of severe crisis marked by cutbacks in expenditures, attempts to reanimate a paltry production and an almost total stagnation of reforms," as the French news agency AFP phrases it.
The plan will be described by Castro in an address to the National Assembly on Sunday.
"There has been a bit of everything: a lack of system, deficiencies of direction in production and commercialization, and problems with transportation and prices. It would be illusory to think that all this can be resolved in five months," said Agriculture Minister Ulises Rosales del Toro, quoted by the AFP.
The government twice reduced the growth estimate for 2009, from 6 percent to 2.5, and later  to 1.7 percent. The Economic Commission for Latin America (ECLA/CEPAL) believes the actual figure will be 1 percent.
Some symptoms of the ailment:
• Imports had to be cut back by 30 percent from $14.2 billion in 2008.
• Exports suffered as a result of a 40-percent drop in the prices of nickel.
• Revenues for tourism ($2.3 billion in 2008) went down by $150 million by September.
• Domestic investment dropped by 25 percent. The number of joint ventures with foreign companies decreased from 314 to 258 this year.
• Because of slow cash flow, the bank accounts of many foreign suppliers were frozen, which resulted in the suspension of some deliveries. Loans from China helped restore some liquidity. (As much as $1 billion was locked up in those frozen accounts, Reuters reported Dec. 22.).
To read the entire AFP analysis, in Spanish, click here.
[UPDATE: In a speech delivered Dec. 20 to the National Assembly, Raúl Castro said: "I can announce that the withholdings of payments accumulated as of [Aug. 1] have been reduced by more than one third. Also, we reiterate our thanks to our partners for the trust and understanding expressed by most of them and ratify our firm desire to continue to honor the commitments we have assumed, to the last cent, in line with the possibilities of the economy. That will be greatly aided by the results of several ongoing negotiations to reprogram the payment of our debt to our creditors."]

The ALBA's sucre bill is no such thing

Those who wonder what the ALBA's newly invented currency looks like need wonder no more.
The SUCRE (acronym for Unit System for Regional Compensation of Payments) is not a bill. It is "a unit of electronic accounting for the financial transactions among the countries that form the Bolivarian Alliance for the Peoples of Our America." It will come into existence in January.
In short, it's an intangible cybercurrency.
The explanation was given by Ernesto Medina, president of the Central Bank of Cuba, to the National Assembly's Committee on Economic Affairs and reported Friday in the daily Granma.
Medina gave the explanation to quell "unfounded rumors that have circulated recently about the imminent use of the sucre as a physical currency" in Cuba and to satisfy people's "interest in knowing its appearance in printed bill and fractional coins."
For the record, Grand Marshal Antonio José de Sucre (1795-1830) was a Venezuelan general and politician who liberated Ecuador and Peru from Spain and was President of Bolivia for two years before his assassination.
–Renato Pérez Pizarro.

Cuba and Libya reestablish trade relations

Cuba and Libya on Friday resumed trade relations after an 11-year pause by signing a protocol in Havana, the Cuban agency Prensa Latina reported.
The signatories were Libyan Deputy Foreign Minister Ahmed Fituri and Cuban Deputy Foreign Trade Minister Ramón Ripoll Díaz.
The agreement covers commerce, tourism, biotechnology, medicine and construction. Libya has requested the assistance of the UNECA construction company to build highways, public buildings, hospitals and schools, Prensa Latina said.
Prior to the ceremony, another accord was signed "to strengthen diplomatic relations, and in the next several months other agreements will be signed to renew [bilateral] exchanges in various sectors," the announcement said.
(ABOVE: Libyan leader Muammar Qaddafi and Fidel Castro in an undated photo.]

End trade and travel bans, L.A. Times says

In an editorial titled "Cracking Cuba," published Thursday, the Los Angeles Times concludes that "the economic pressure that failed to yield either regime change or human rights reforms over more than four decades of Fidel Castro's rule is just as ineffective today as it has always been.
"Instead of continuing a failed policy," The Times says, "the Obama administration should craft a new one of incentives for Cuba to improve its human rights record."
The Times concedes that "Raúl Castro continues to stifle political dissent" and cites a recent Human Rights Watch report that says activists "are subjected to systematic due process violations, including abusive interrogations, the denial of legal counsel and sham trials."
Yet, the editorial says, the "U.S. travel and trade bans [...] must be lifted."
In addition, "it would be best if the U.S. and the European Union forged a common policy pushing for the release of political prisoners and other human rights improvements, while making clear they do not seek regime change," the editorial continues.
"Frequent contact between peoples and the free flow of goods and ideas are the best means to create pressure for change. As Human Rights Watch notes, the U.S. embargo has too long served the Castros as a pretext for cracking down on dissidents. Try something else."
To read the entire editorial, click here.

Travel ban will be subject of House hearing

The full House Committee on Foreign Affairs will hold a hearing Thursday (Nov. 19) on the question "Is It Time To Lift the Ban on Travel to Cuba?"
The committee, chaired by Rep. Howard L. Berman (D-Ca.), will meet in Room 2172 of the Rayburn House Office Building at 10 a.m. to listen to testimony from:
– Gen. Barry R. McCaffrey, U.S. Army (retired), former chief of the Southern Command;
– Ignacio Sosa, member of the executive board of Friends of Caritas Cubana;
– Berta Antúnez, sister of dissident leader Jorge Luis García Pérez; and
– James Cason, former chief of the U.S. Interests Section in Havana.
On April 29, General McCaffrey advocated the lifting of the U.S. trade embargo during a hearing of the House Subcommittee on Foreign Affairs. At the time, he summarized his conclusions thus:
• "The people of Cuba need to determine their own future.
• "U.S. government role [...] must be supportive. We should start now by rapidly lifting the embargo. This will be a catalyst for political change.
• "Our technical experts can be helpful but they must work in partnership with capable Cubans and play a supportive role.
• "Cuba will reassume its place in the international community. We must recognize that it will have political, economic, and social relationships with multiple nations.
• "In the end, a broadly cooperative approach will be healthier for Cuba and for longer-term U.S.-Cuban relations.
• "Multilateral lending organizations like the International Monetary Fund, the World Bank, and Inter-American Development Bank will make enormous contributions.
• "Government-to-government relations and accords will likely not be the centerpiece of future U.S.-Cuba dialogue. We must make space for civil society right from the start as we reengage with Cuba."
This week, García Pérez (aka "Antúnez") organized what he called a National Front for Civic Resistance and Civil Disobedience that will stage "massive acts and civil demonstrations to achieve the unconditional release of all political prisoners in Cuba." Its slogan: "We all are the resistance."
García Pérez served 17 years in prison for civil disobedience. He was released in 2007.
–Renato Pérez Pizarro.

China, Cuba enter electronics joint venture

China and Cuba plan to establish a joint venture next year that will enable the local manufacture of electric and electronic equipment, the Cuban media announced Saturday.
The project, between China's Haier Corporation and the Electronics Group of Cuba's Communications Ministry, is ambitious. It envisions the manufacture of television sets, domestic appliances, washing machines, refrigerators, air-conditioning equipment, computers (both desk and laptop) and street lights.
This will be the first time Cuba would manufacture TV sets. Chinese sets have been assembled on the island for the past five years.
Haier is the world's fourth-largest producer of electrical appliances and China is Cuba's second-largest trade partner, after Venezuela. Trade between Beijing and Havana in 2008 was $1.9 billion, according to Cuba's National Statistics Office.
No figures were mentioned for this particular deal, but presumably the money will come from a $600-million line of credit that China granted Cuba in September. (See our Sept. 2 blog item "China grants Cuba...")
–Renato Pérez Pizarro.

Unproductiveness is decades-old problem, judging from Castro's recycled speeches

Excerpt from a speech by Fidel Castro, Dec. 7, 1970, published Wednesday atop Page One of the daily Granma. For context, read our Nov. 10 blog item, "Too many brains..."
"Productivity has practically been forgotten, and unproductiveness is the abyss that threatens to swallow the nation's human resources and riches. [...] ...the workers must become aware of this problem. These are obligations that cannot be sidestepped, they are realities that cannot be ignored.
"We still have enormous resources with the productivity that can be achieved [...] with very little or no additional effort, by clearing some bottlenecks, with better organization, with better use of the workday, with more discipline, with some rationality, with some common sense..."
(ABOVE: Castro in a 1970 photo.) [UPDATE: In another excerpt, from a July 1986 speech, Castro reminds everyone that "the workday is sacred." To read it, click here. Read also his elegy to labor, on Page One of Granma on Nov. 18.]