Survey
* Your assessment is very important for improving the workof artificial intelligence, which forms the content of this project
* Your assessment is very important for improving the workof artificial intelligence, which forms the content of this project
NS4540 Winter Term 2017 Cuba Up-Date 2016 Cuba Up-date 2016 II • Seventh Congress of Communist Party, April 2016 • Economy was main focus • Just as in 2011 when Castro launched the updating of Cuba’s Soviet Era economic model • Sought to replace it with a Cuban version of market socialism • Three economic documents produced • Review of economic performance since 2011 • A plan for 2016-2021, and • A broad national development plan looking out to 2030 2 Cuba Up-date 2016 I • Performance review was disheartening • Only 21 of the 313 economic guidelines adopted in 2011 have been fully implemented • Castro attributed this to “the burden of an outdated mentality” and “an attitude of inertia.” • Annual GDP growth rate from 2001-2015 just 2.8% not enough Castro conceded to improve standard of living for most people • Tourism and export of medical services were bright spots with tourism growing 17% in 2015 • However agricultural production lagged despite the expansion of market incentives for farmers • Cuba still imports 60% of its food at a cost of $2 billion annually when it should be exporting food • Private sector lacking seeds, fertilizer, pesticides and equipment 3 Cuba Up-date 2016 III • Process of rationalizing state enterprises which still produce about ¾ of Cuba’s GDP slow • Hampered by managers not encouraging initiative and entrepreneurship • Castro vowed to push ahead announcing Cuba would legalize small and medium-sized private businesses and • Continue devolving small state enterprises and cooperatives • Only strategic sectors of the economy “decisive for national development” would remain in the state sector 4 Cuba Up-date 2016 IV • On the questions of how to stimulate growth and manage relations with the U.S. – Dilemmas • Cuba’s leadership; faces tensions between economic imperatives and political necessity • Cuba wants normal relations with the U.S. to increase trade, tourism and investment – all key to improving growth • With engagement comes political risk that Cubans may become less tolerant of • poor economic performance – blamed for many years on the U.S. Embargo • State’s restrictions on civil liberties – blamed on need for unity in face of U.S. aggression 5 Cuba Up-date 2016 V • Contradiction between economic dynamics and political needs evident in current problem of rising food prices • With private farmers able to sell produce to hotels full of tourists, supply of food in free farmer’s markets shrank earlier in 2016 driving prices up • Economic logic would dictate higher prices would stimulate greater production in long term but that was a political risk government unwilling to take • Forced farmers to sell more of their produce through state distribution systems at controlled price • Pleased consumers, but undercut incentives for farmers to raise production 6 Cuba Up-date 2016 VI • In addition with economic transformation underway income distribution is worsening • Major challenge to the Communist Party • Sustainable and prosperous socialism requires economic change but • Near-term dislocations that change produces are undermining political supports for reform process both in elite circles and on streets. 7