• Submitted by: manso
• Politics and Government
• 05 / 17 / 2011

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Mon May 16, 9:57 pm ET. HAVANA (Reuters) – Communist-run Cuba has given all small businesses the authority to hire labor and will loosen other regulations governing private enterprise, the government said in a statement on Monday.

The measure was the latest indication that President Raul Castro's government has decided to loosen its grip on economic sectors that include retail services, construction and transportation in favor of private business.

Last year, the government allowed some types of family businesses and skilled trades to hire workers.

The government said that "the Council of Ministers agreed to extend to all non-state activities authorization to contract workers and continue the process of making more flexible regulations on self employment."

It provided no further details in the statement read on state-run television.

The Cuban economy is dominated by the state, which employed about 85 percent of the labor force through 2009.

The government announced plans late last year to lay off hundreds of thousands of workers and move them to what it called the "non-state" sector as part of an efficiency drive.

In the years after the 1959 revolution, Cuban leader Fidel Castro, now retired, nationalized all small businesses.

Self-employment, often a euphemism for small private businesses, was first authorized in 1993 after the fall of the Soviet Union plunged Cuba into crisis, but it was severely restricted until last year.

In September, the government began issuing new licenses, allowed family businesses to rent space outside their homes, sign contracts with the state, hire labor and seek bank credits, among other measures.

More than 200,000 new licenses have been granted since October, compared with less than 150,000 that existed previously.

(Reporting by Marc Frank; Editing by Jeff Franks and Peter Cooney)