Castro Attempting to Unite Cuba

Image

Cuban Peso – CUP (left) and Cuban Convertible Peso – CUC (right)

By: Abby Belongy

Cuba’s dual currency system has been stratifying people since it was implemented after the fall of the Soviet Union two decades ago.  Originally intended to protect Cuba from capitalism, the Cuban convertible peso (CUC) is equivalent to the U.S. dollar.  Tourists and the wealthier islanders use CUCs.  The majority of Cubans, however, earn the other form of currency, the Cuban peso (CUP).  This is worth only about 4 cents – 25 times less than that of the convertible peso.

Cubans have long complained about the dual system.  Most Cubans can only earn CUPs but can only buy imported goods with CUCs.  This leads to the rich accumulating more and more material goods while the poor struggle to purchase basic necessities.  Interestingly, a hotel clerk could also earn a much larger salary from tourists’ tips than a doctor who treats national patients.

On October 29, 2013, President Raul Castro announced an 18-month plan to unify Cuban currency into a single Cuban peso.  Castro hopes to improve and open up the Cuban economy with a fairer and less complicated system.  Most people currently earning CUPs embrace this decision.

However, Castro has not provided many details on how such a complicated process will work.  Although most want a unified system, economists worry about the practical issues.  Eliminating the two-tiered system could drive up inflation and cause public turmoil.  State-run enterprises will also suffer, as right now government treats the CUP and the CUC as equal in official accounts – a huge financial incentive.

This step could show Cuba warming up to the rest of the world and attempting to come out of isolation, though Castro insists this process is necessary for Cuba’s survival as a socialist state.  If executed methodically and carefully, the unified system could make a huge impact on marginalized people in Cuba.  The poor majority can improve quality of life and have a chance to “catch up” to the elite.  On the other hand, the elimination of one of the pesos could shock the economy and bring even more economic turmoil to already struggling citizens.

Read more on Cuba’s monetary system and plans: http://www.telegraph.co.uk/news/worldnews/centralamericaandthecaribbean/cuba/10397304/Cuba-to-end-dual-currency-as-part-of-Castros-economic-reforms.html

http://www.cnn.com/2013/10/22/world/americas/cuba-single-currency/

Advertisements

Cuba Excels at Millennium Development Goals

The 8 UN Millennium Development Goals

By Abby Belongy

A majority of Americans seem to have a negative view of Cuba.  They see extreme oppression, poverty, and lack of development and globalization with the rest of the world. Because of this, most would be surprised to learn that Cuba has already met most of the UN Millennium Development Goals (MDGs) set for 2015.  The country’s infant and maternal mortality rates are some of the lowest in Latin America and the world,  respectively.  Additionally, all citizens have access to free public health and vaccinations.  With the blockade with the U.S. still going strong, Cuba is still increasing medical research, including AIDS/HIV prevention – one of the MDGs.

Cuba is also making strides in eradicating hunger and poverty, women’s equality, and increasing education for children.  UNESCO even ranked Cuba as 14th in the world for its high level of education.

While Cuba has accomplished some of the goals and is working toward others, many problems still exist.  Hunger and poverty have improved, but they are still far from good rates.  In February 2013, a Cuban delegate blamed some of these problems on the unfair global economy.  She asserted that countries in the South are affected much more negatively, and Northern cooperation and assistance is necessary to truly reach all the high goals and standards.

While Cuba reports that it has accomplished much on its own, it probably cannot progress much further without help from the U.S. and the rest of the developing world.  However, we aren’t likely to see that happen anytime soon.

Learn more about the mission of the MDGs: