• Submitted by: manso
• Business and Economy
• 04 / 13 / 2011

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Previews updating of economic system on eve of Sixth Communist Party Congress this weekend. The separation of state and state-run business is the subject of an article Wednesday in Granma, titled "Give unto business what is business', unto the state what is the state's."

The topic is the "actualization," or updating, of Cuba's economic system, on the eve of the Sixth Congress of the Cuban Communist Party, set for April 16-19.

"An excessive oversight of each activity of the economy led most of the [state] institutions – in a decidedly paternalistic practice – to assume from the outside the management of the companies," the article says.

But, by reducing the companies' decision-making ability, the state also took away their responsibility, Granma says. The companies "then stopped looking forward in their daily business and began looking upward, toward the higher institution."

"They were invaded by the inertia of waiting for rulings and assignments – which in many cases was used as an excuse to evade any blame when manna (raw materials, replacement parts) stopped falling from the sky – and turned their initiative into an attitude of 'let's-wait-for-instructions.'"

That passivity was fatal, the article says. In many cases, "the companies lost their ability to react, to move, and often ceased to depend on their revenues," turning instead to the state budget. Other companies, rudderless, shifted their objectives and took up tasks other than those for which they had been created, "including [tasks] of a governmental nature."

Consequently, the state, whose role had been to guide and monitor state-run enterprises, found itself running the enterprises, "acting simultaneously as judge and litigant," Granma says. Then the article turns grim.

"Conditions at present do not allow for more delay: either the river stays within its banks or it will sweep us down the falls," the paper says in a vivid metaphor.

A modified vertical economy

"Once and for all, companies must take their own steps, keeping the approved plan as their goal and observing the legal framework of each procedure." Administrators must assume more responsibility and create ways to stimulate the workers.

Administrators must abide by the contracts, design internal control and accurately draft, approve and execute all plans.

"The task of the administrator or director is to operate with the available resources and overcome the eventual obstacles," not to wait for instructions from some distant ministry.

In turn, the state institutions "must concentrate in projecting the policies to be followed, in giving everyone his own role and demanding results without restricting or taking over any powers and without eventually assuming – via substitution – the obligations of the companies."

However, "let no one mistake an increase in entrepreneurial autonomy with deregulation," the article cautions. The state remains the supreme helmsman.

Although long and written in a cloying sermon-cum-lecture style, the article is illustrative of the government's intention to give enterprises more autonomy and responsibility while retaining its oversight of business

Source: miamiherald.typepad.com/cuban_colada/2011/04/t.html