{"id":45864,"date":"2021-07-16T13:23:42","date_gmt":"2021-07-16T13:23:42","guid":{"rendered":"https:\/\/qatar-news.org\/qatarnewsEn\/?p=45864"},"modified":"2021-07-16T13:23:42","modified_gmt":"2021-07-16T13:23:42","slug":"cuba-protests-the-economic-woes-driving-discontent","status":"publish","type":"post","link":"https:\/\/qatar-news.org\/qatarnewsEn\/?p=45864","title":{"rendered":"Cuba protests: The economic woes driving discontent"},"content":{"rendered":"
\n

Cubans have taken to the streets in cities across the country over the last week, in a wave of rare public protests to express their frustration with rising prices, falling wages and the failings of the island\u2019s long-standing communist government to address these economic challenges.<\/p>\n

Cuba\u2019s coronavirus pandemic-ravaged economy shrank by 11 percent in 2020, the island\u2019s economy minister said, the sharpest contraction since the collapse of the Soviet Union in the early 1990s.<\/p>\n

Soaring global food prices<\/a> this year and the island\u2019s devalued currency <\/a>\u2014 coupled with shortages of basic goods that predate the pandemic \u2014 have fuelled discontent. Both pro- and anti-government demonstrators have taken to the streets since Sunday.<\/p>\n

Cuban President Miguel Diaz-Canel has blamed the protests on United States sanctions, accusing Washington of\u00a0 \u201ceconomic asphyxiation\u201d. But he also is acknowledging \u2014 notably for the first time \u2014 that the Cuban government\u2019s policies have also played a role.<\/p>\n

So what are the economic forces behind Cuba\u2019s latest protests? Here\u2019s what you need to know.<\/p>\n

Anti-government protesters march in Havana, Cuba on Sunday, when hundreds of demonstrators took to the streets in several Cuban cities to protest against ongoing food shortages and high prices of foodstuffs [File: Eliana Aponte\/AP Photo]<\/figure>\n

Start from the beginning. What kind of economy does Cuba have?<\/h3>\n

Cuba has what\u2019s known as a command economy, where the government \u2014 not market forces of supply and demand \u2014 largely determine the production, availability and value of goods.<\/p>\n

Command economies are central features of communist societies, and Cuba has been ruled by its communist party since forces led by Fidel Castro overthrew dictator Fulgencio Batista during the Cuban Revolution in 1959.<\/p>\n

What does a command economy look like?<\/h3>\n

In command economies (also called planned economies), the government controls many of the means of production, while private ownership of industries, property and other resources is significantly limited.<\/p>\n

Before the Cuban Revolution, a small elite owned much of the island\u2019s land, industries and wealth. The revolution was designed to make Cuba a more equal society, and in many ways, it succeeded in that goal.<\/p>\n

So if it tackled inequality, why is the economy such a mess?<\/h3>\n

Part of the problem is that government control of the majority of industries can lead to inefficiency, bureaucracy and mismanagement. That, in turn, can translate into shortages of goods, higher prices and frustration for citizens.<\/p>\n

But the US embargo against Cuba has certainly done the island\u2019s economy no favours.<\/p>\n

Tell me about the US embargo.<\/h3>\n

Since 1960, the US \u2014 Cuba\u2019s neighbour 145km (90 miles) to the north and once major trading partner \u2014 has maintained a trade embargo against the island in an effort to force its communist leaders from power.<\/p>\n

The embargo, a form of severe economic sanctions, hasn\u2019t achieved its goal, but it has made life for ordinary Cubans harder. Medicine, food and all sorts of other goods are in chronically short supply.<\/p>\n

The embargo has also provided the island\u2019s government with ammunition for its claims that its economic woes are the fault of the US.<\/p>\n

Is the government blaming the embargo for its current economic problems?<\/h3>\n

Partly. In a speech Wednesday, Diaz-Canel slammed the embargo, which Cubans refer to as a \u201cblockade\u201d, as \u201ccruel\u201d and \u201cgenocidal\u201d. But he also acknowledged for the first time that the Cuban government\u2019s actions have played a role in people\u2019s discontent.<\/p>\n

\u201cWe have to gain experience from the disturbances,\u201d Diaz-Canel said. \u201cWe also have to carry out a critical analysis of our problems in order to act and overcome, and avoid their repetition.\u201d<\/p>\n

In a tweet Thursday, Diaz-Canel said the embargo has made overcoming the island\u2019s problems harder, tweeting that \u201cthe blockade surpasses any desire, it delays us, it does not allow us to advance at the speed we need\u201d.<\/p>\n

Has the Cuban government tried to fix the problems its policies have created?<\/h3>\n

On paper. Back in 2011, then-President Raul Castro announced reforms aimed at bringing more market-oriented policies into Cuba\u2019s state-run economy, including allowing people to set up small businesses and eliminating some of the government\u2019s notorious bureaucracy.<\/p>\n

But 10 years later, the country\u2019s leadership has been slow to enact many of those incremental economic reforms, leading to frustration \u2014 especially given the urgent conditions Cubans are facing right now.<\/p>\n

What are some of those conditions?<\/h3>\n

The COVID-19 crisis has gutted tourism, cutting off a major source of income for Cubans who work in the industry and a major source of US dollars for the Cuban government. That\u2019s especially bad news right now when surging commodity prices mean the government needs to spend more to import food.<\/p>\n

Remittances, a lifeline for struggling Cuban families estimated at $2bn to $3bn per year, plunged after former US President Donald Trump tightened restrictions on Cuban Americans sending money back to the island. The pandemic has only served to further stifle the flow of remittances.<\/p>\n

And a shortage of foreign currency and the US embargo have also hit Cuban sugar production hard, with the state\u2019s sugar monopoly reporting that this year\u2019s harvest stood at just 68 percent of the country\u2019s planned 1.2 million tonnes<\/a>, the lowest level since 1908, Reuters news agency reported.<\/p>\n

What role does the island\u2019s weakened currency play in the protests?<\/h3>\n

A big one. At the beginning of this year, the Cuban government formally ended its dual currency system, devaluing its peso for the first time since the 1959 revolution.<\/p>\n

The Cuban peso, known as the CUP, was created as the island\u2019s currency by the first president of the country\u2019s post-revolution Central Bank, Ernesto \u201cChe\u201d Guevara. The CUP has always been used for everyday domestic transactions, and many Cubans are paid their wages in CUPs.<\/p>\n

But thanks to the US embargo and some of the island\u2019s state-run economic policies, the value of Cuba\u2019s currency evolved to become a tricky issue. Following the collapse of the Soviet Union \u2014 Cuba\u2019s major ally \u2014 the island allowed people to use the US dollar alongside the CUP starting in 1993.<\/p>\n

Customers wait in line to enter a grocery store in Havana, Cuba near portraits of the late revolutionary Ernesto \u2018Che\u2019 Guevara (right) and the late Venezuelan President Hugo Chavez (left) [File: Natalia Favre\/Bloomberg]<\/figure>\n

So do Cubans still use the peso and the dollar?<\/h3>\n

Yes, sometimes. Faced with a cash crunch, the Cuban government reallowed \u201cdollar stores\u201d last year that let people buy goods like food, toiletries and electronics with bank cards loaded with US dollars or other foreign currency.<\/p>\n

That, in turn, let the government snap up those dollars to help deal with its liquidity crisis.<\/p>\n

But the Cuban government phased out a third currency \u2014 the Cuban convertible peso, known as the CUC \u2014 earlier this year, leading to problems.<\/p>\n

What\u2019s the deal with CUCs?<\/h3>\n

The Cuban government created the CUC in 2004 for conducting state business and buying goods from abroad after it banned US dollars. It pegged the CUC 1:1 to the greenback and stipulated it couldn\u2019t be taken out of the country.<\/p>\n

Until this year, those working in the tourism sector, for example, were still paid in CUCs, leading to disparities with Cubans paid in CUPs. That\u2019s partly why Cuba\u2019s government scrapped the CUC.<\/p>\n

Cubans who worked in the tourism sector have been particularly hard-hit by the pandemic and the move to a single currency, as they had been paid in the convertible pesos the government chose to phase out [File: Natalia Favre\/Bloomberg]<\/figure>\n

So what happened to all of the CUCs?<\/h3>\n

Cubans had through June to trade in their CUCs for CUPs. But the devaluation of the currency means they lost a significant amount of money in doing so, something that hit private-sector workers who have been paid in CUCs for years \u2014 workers like those in the tourism sector \u2014 particularly hard.<\/p>\n

It has already been a tough year for those workers, as the coronavirus pandemic significantly curbed tourism and as former US President Donald Trump tightened the US embargo against the island.<\/p>\n

The US trade embargo has made life more difficult for the Cuban people [File: Natalia Favre\/Bloomberg]<\/figure>\n

What does the rest of the world say about the embargo?<\/h3>\n

Resoundingly: end it. For years, the United Nations General Assembly has taken a vote, and the results are overwhelming.<\/p>\n

The UN\u2019s resolution<\/a> calling for an end to the embargo was adopted for the 29th time on June 23, with 184 countries in favour of ending it, three abstaining and just two voting to continue it: the US and Israel.<\/p>\n

The vote is symbolic, however, since only the US Congress can actually end the economic sanctions against Cuba. So far, the administration of US President Joe Biden \u2014 and the US\u2019s narrowly Democratically-controlled Congress \u2014 have not made a move to do so.<\/p>\n

A woman shouts pro-government slogans as anti-government protesters march in Havana, Cuba on July 11, 2021 [File: Ismael Francisco\/AP Photo]<\/figure>\n

What have the protests achieved so far?<\/h3>\n

The Cuban government announced it would ease customs restrictions<\/a> on food, medicine and hygiene products brought into the country by travellers, but it\u2019s unclear how much of a difference that will make since tourism remains down as the pandemic continues.<\/p>\n

More broadly, the protests have served to draw attention to Cubans\u2019 plight and spotlighted long-standing issues that need to be addressed with new urgency.<\/p>\n<\/div>\n","protected":false},"excerpt":{"rendered":"

Cubans have taken to the streets in cities across the country over the last week, in a wave of rare public protests to express their frustration with rising prices, falling wages and the failings of the island\u2019s long-standing communist government to address these economic challenges. Cuba\u2019s coronavirus pandemic-ravaged economy shrank by 11 percent in 2020,…<\/p>\n","protected":false},"author":10,"featured_media":0,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[1],"tags":[],"class_list":["post-45864","post","type-post","status-publish","format-standard","hentry","category-spotlight_news"],"_links":{"self":[{"href":"https:\/\/qatar-news.org\/qatarnewsEn\/index.php?rest_route=\/wp\/v2\/posts\/45864","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/qatar-news.org\/qatarnewsEn\/index.php?rest_route=\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/qatar-news.org\/qatarnewsEn\/index.php?rest_route=\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/qatar-news.org\/qatarnewsEn\/index.php?rest_route=\/wp\/v2\/users\/10"}],"replies":[{"embeddable":true,"href":"https:\/\/qatar-news.org\/qatarnewsEn\/index.php?rest_route=%2Fwp%2Fv2%2Fcomments&post=45864"}],"version-history":[{"count":0,"href":"https:\/\/qatar-news.org\/qatarnewsEn\/index.php?rest_route=\/wp\/v2\/posts\/45864\/revisions"}],"wp:attachment":[{"href":"https:\/\/qatar-news.org\/qatarnewsEn\/index.php?rest_route=%2Fwp%2Fv2%2Fmedia&parent=45864"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/qatar-news.org\/qatarnewsEn\/index.php?rest_route=%2Fwp%2Fv2%2Fcategories&post=45864"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/qatar-news.org\/qatarnewsEn\/index.php?rest_route=%2Fwp%2Fv2%2Ftags&post=45864"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}