IMF aid would highlight failures in Cuba

December 20, 2011


An old joke I heard for the first time more than 20 years ago in Havana says that the three biggest achievements of the Cuban revolution are health, education and low infant-mortality rates, and that its three biggest failures are breakfast, lunch and dinner.

A new study by the Brookings Institution think tank shows that, two decades later, things remain just as bad, if not worse.

Consider some of the findings of the study, titled “Reaching out: Cuba’s new economy and the international response.” It was written by Richard E. Feinberg, a former Clinton administration Latin American adviser who supports growing international development cooperation with Cuba and who traveled to Cuba earlier this year and interviewed Cuban officials, academics and average citizens.

• Despite big increases in tourism, some investments in mining and massive subsidies from Venezuela, “the Cuban economy remains in the doldrums.” The main constraint slowing the Cuban economy is not U.S. trade sanctions, but Cuba’s own outdated economic model, inherited from the Soviet Union, of central planning, it says.

• Cuba’s average income is one of the lowest in Latin America: 448 pesos a month, or $20 at the official exchange rate. University graduates are in a frantic search for jobs, such as hotel doormen or waiters, that offer access to foreign currency, or they want to emigrate, it says.

• Measured in per-capita income on a purchasing power parity basis, Cuba’s per capita income is $6,000 a year. By comparison, it is $8,000 in the Dominican Republic, $11,000 in Brazil, and $14,000 in Mexico, Chile and Uruguay, according to United Nations figures.

• Industrial production stands at only 43 percent of its 1989 levels and employs only 10 percent of today’s workforce. Exports of goods are a paltry $3 billion to $4 billion a year, only slightly more than Venezuela’s annual oil-for-doctors subsidies to the island.

• Cuba’s external debt is “alarming.” According to Cuba’s Central Bank, the island owes $8.9 billion to foreign creditors, plus another $7.6 billion in “frozen debts” that have not been restructured in more than two decades.

• Cuba has developed service industries — such as tourism, which has grown to 2.5 million visitors a year — and exports doctors to Venezuela through government-run oil-for-doctors swaps. The services sector now accounts for 81 percent of the island’s economy but is not enough to get the economy on its feet, the study says.

• Despite Cuban President Raul Castro’s recently announced pro-market economic reforms — including allowing certain forms of home ownership — implementation of these reforms is slow and erratic amid fierce quarrels between hard-liners and reformers within the regime, it says.

Feinberg’s study proposes supporting economic reforms in Cuba through a growing involvement of international financial institutions, such as the International Monetary Fund, and by lifting U.S. barriers to these institutions’ technical assistance to Cuba.

Interestingly, Cuban officials expressed some interest to engage with the IMF and the World Bank, especially since these institutions have conceded that “there is no single model of development,” and have gained experience from their recent advisory roles in Vietnam and Nicaragua, it says.

“When asked by the author for the Cuban position regarding IMF membership, a senior official of the Cuban ministry of foreign affairs responded: ‘Cuba has no principled position against relations with the IMF or the World Bank,’” the study says. It was the first time Cuba has made such a statement, it says.

My opinion: If Gen. Castro’s military dictatorship wants IMF help, after decades of lashing out against that Washington-based institution — it shouldn’t be denied technical assistance. It would help build bridges with reformers within the regime, and would amount to a dramatic example of how Cuba’s octogenarian rulers have failed on all fronts.

Those who claim that the Castro brothers are still popular, and that Cuba has a model education system, should be asked: If Cuba’s leaders are so popular, why don’t they dare hold free elections? And if Cuba’s education system is so good, why doesn’t Cuba participate in the world-wide PISA tests of 15-year-old students? The answer is simple: Cuba’s entire propaganda campaign, unchallenged on the island because of rigid state censorship, would not hold up to the most basic independent scrutiny.

The old joke I heard in Havana doesn’t work anymore. Today, Cuba has the worst of both worlds: It doesn’t have great social services, or breakfast, lunch and dinner.

Andres Oppenheimer is a Latin America correspondent for the Miami Herald. His email address is aoppenheimer@miamiherald.com.


Paul R Getto 6 years, 6 months ago

Good points, sir. We need to completely lift the embargo and undermine them with FaceBook, Levis and fast food. It worked with the Russians and it will work in Cuba.

Getaroom 6 years, 6 months ago

I like Weebles!!! Weebles never give or take hand(s)outs.

Imagine a Cuba made in our own image. Remember, think only of numbers and let math be the guide!!!!! Be one with the math.

Let's do it - be Patriotic or go to Guitmo resisting a GOD Given and fully backed plan - Democracy!!
But please, please do not ask Congress for this next thingy, please!!!!! There are some things the sheeples sold not know about in advance. Shhhh, be very quiet until it's on pay per view TV. You know war ain't cheap and it's gotta be payed for it somehow. OK!! Make war wily nilly. Use more "hands-off-eyes-on"(HOEO) modern war tech to invade, provide shock and awe, kill innocent citizens, hunt down and kill current evil doers. in addition, print playing cards with evil doers faces and go to Grenada if you must, but track them down. Kill more innocent people who look/speak differently, install a new "friendly puppet dictator" (of the current USA deciders choosing), bring in BIG US and Multinational Corporations to run the reality show, set up a new Chevy plant with US tax dollars(Cubans love Chevys), rebuild infrastructure that can only be used by the uber wealthy.

Great plan, it has worked so well in the past and hardly cost a dime.

All the GOP candidates still standing, except Daddy Paul, will like this. It's a kill or be killed scenario, all about survival of the fittest in an economic desert. Except for Paul - he only wants Free Market Capitalism - a fully owned and operated subsidiary of the one percenters uber alles.

Paul R Getto 6 years, 6 months ago

Getaroom: I think you are on to something. Sounds like eco-devo to me, at least for the MIC. War is peace; love is hate; the Iraqis welcomed us with flowers and open arms and their oil flow paid for the war. See how easy it is? Dick Cheney, we hardly knew ye!

Commenting has been disabled for this item.