“Tighten your seat belts,” Cuban dictator Raúl Castro told listeners during a speech to his legislature on Friday, warning that the communist nation would be imposing strict economic measures to ward off further decline triggered by the economic collapse of its biggest ally, Venezuela.
“It is necessary to reduce all sorts of expenses that are not essential, develop a culture of saving and efficient use of available resources,” Castro told the Cuban Parliament. His speech occurs following weeks of speculation among Cubans that the economy is close to collapse and that citizens may once again endure a “special period,” the communist shorthand for the economic crisis following the collapse of the Soviet Union in the 1990s.
“We do not deny that there may be struggles, including some larger than those currently occurring, but we are prepared and in the best conditions to reverse them,” Castro alleged, denying “speculation of an immediate collapse of our economy.”
After months of positive news coverage following President Barack Obama’s visit to Cuba – a move to “normalize” relations with the communist government – and the announcement of a number of American corporations looking to invest in the island, Cuba’s economy is nowhere closer to escaping the threat of collapse. Fox News Latino notes that, by Castro’s estimates, the economy grew half of what it was projected to, a mere one percent. Castro has ordered corporations to reduce energy and electricity costs by half to save fuel as the government of Venezuela struggles to generate oil; Cuba relies on Venezuela for 60 percent of its oil consumption.
Before Castro’s speech, the nation’s economic minister announced a plan to reduce energy consumption nationwide by 28 percent before 2017.
In his speech Friday, Castro addressed that Cuba still was not allowing businesses to conduct transactions using the U.S. dollar, a move that would generate more trust among business owners and possibly stimulate the economy. He did not give an explanation, stating only that “the truth is that it has not yet been possible to issue payments or deposits in that currency.”
President Obama’s administration has made it a goal to open Cuba up to American corporations. To that end, a bipartisan group of senators and congressmen followed him to Cuba in March. Figures like Republican Governor of Texas Greg Abbott visited the island looking for ways to connect Texan corporations to the communist Cuban government, dismissing concerns of human rights violations and political oppression. As the politicians did, so did the corporations: Carnival Cruises has already begun voyages to the communist country, while Norwegian Cruise Line is seeking permission to dock in Havana. At least eight U.S. airlines will soon begin direct flights to Cuba.
There is little indication that increased American business in Cuba will result in larger salaries or more economic freedom for the average Cuban citizen. To ensure that this would not be the case, Castro passed an order in late 2014, almost immediately following President Obama’s speech announcing a diplomatic thaw with the island, stating that the government would pocket 92 percent of the salary of any Cuban citizen working for a foreign corporation. Cuban businesses, to the little extent that they exist, are bound to use the Cuban local currency, as opposed to the Cuban convertible peso used by tourists and tethered to the value of the dollar.
COMMENTS
Please let us know if you're having issues with commenting.