The most eloquent example of the complexity of the process of implementation of the Socio-Economic Guidelines lies in the monetary and exchange duality, asserted on Saturday Army General Raul Castro, First Secretary of the Cuban Communist Party (PCC).
While reading the main report of the Seventh Congress of the organization, in session at Havana’s Convention Center, the President of the councils of State and Ministers said that this is a matter on which work has not stopped in recent years and the solution of which “will not be postponed indefinitely.”
He said that although the unification of the two currencies is not the magic solution to all structural distortions in the economy, it will represent a major boost to progress in the rest of the tasks with a view to the update of the national model.
In the presence of delegates and guests to the PCC meeting, Raul confirmed the decision to guarantee bank deposits in foreign currency, convertible Cuban pesos (CUC) and Cuban pesos (CUP) as well as cash in the hands of the population and national and foreign legal entities.
He stressed that work on the monetary system will favor the creation of conditions required to overcome the harmful effects of egalitarianism, and to make the socialist principle of each according to his ability and to each according to his work come true, and rectify the phenomenon of the so-called inverted pyramid.
He considered that in the dual scenario, the state company, main actor of the economy, is in a disadvantageous position as compared to the growing non-state sector, which benefits from working in a monetary system based on the exchange rate of one CUC for 25 CUP, while entities are governed by the parity of the two pesos.
The Cuban president stated that such distortion must be solved as soon as possible, because this anomaly, added to the discrete performance of the economy, has not allowed substantial progress in the implementation of guidelines linked to the gradual elimination of undue gratuitousness and excessive subsidies.
It has also led to the impossibility to generalize the increase of the income of workers and ensure the stable supply of certain goods, he added.
At another point in his speech he referred to the high rate of aging of the Cuban population, which migrates from the countryside to the cities, concentrates and raises its qualification level, which represents a strategic problem.
In order to address this situation, he commented that a policy was developed which includes 76 measures and 252 actions, the implementation of which will be gradual, depending on the performance of the economy.
As another result of the last five-year period, Raul referred to the approval of the Foreign Investment Law, recognized as an important source for the country’s progress, which preserves national sovereignty, environmental protection and rational use of natural resources.
He highlighted the establishment of the Special Development Area of Mariel with additional advantages, and the ensuring of a legal framework and infrastructure for the development of projects that generate exports, promote the replacement of imports, the transfer of technologies and become a source of employment and of long-term financing.
In this regard, he stressed that although the implementation of the U.S. blockade has a bearing on that road, it is necessary to leave behind archaic prejudices concerning the importance of foreign investment.
Although considerable tension remains in supplies, he said that improvisation and superficiality and lack of a comprehensive way still persist in investment processes, leading to lengthy execution deadlines and affecting quality.
Raul also addressed the changes that are being made with the purpose of strengthening socialist state enterprises, and asserted that today directors have greater powers; however, it is a route that is not covered in one day, which will mature in the medium and long term.
He stressed that the experiment is currently in the implementation phase for subsequent materialization in Artemisa and Mayabeque, regarding the separation of functions in the Assemblies of the People’s Power and the Administration Councils.
The implementation of the new model has led to a notable reduction in positions without generating instability in performance, favoring authority, he added.
However, he acknowledged that there have been deficiencies in the carrying out and control of approved policies, such as in the training of different levels of management; “There has been lack of the sense of urgency, contrary to the spirit of approved measures,” he pointed out.
As an example he cited the behavior of prices of agricultural products, and the emergence of the phenomenon of hoarding to the detriment of the population, and stressed that in this situation production is key and objective and subjective factors have an influence on it.
We can not sit with our arms crossed in the presence of the unscrupulous management of prices by individuals who seek to enrich themselves more and more, he stated, insisting that the recognition of market in the performance of the economy does not imply that the Party, the Government and mass organizations no longer play their role of facing the unjust problems affecting the population.
In this regard, he described as positive the current experiences aimed at achieving greater state control in marketing to influence price reduction, an issue that requires monitoring.