Cuba Central Bank prepares monetary unification
- Submitted by: Luis Manuel Mazorra
- Business and Economy
- 10 / 03 / 2014
The disappearance of CUC and with it the dual currency will be the most important change that holds the Cuban government. The Cuba Central Bank coordinated with the Central Government preparations for Day Zero.
Announced by Marino Murillo, the retail prices and the state of bank accounts cannot alter, was ratified by Ernesto Medina, Minister President of the institution issuing the Cuban currency. He also reported that in order to successfully change will be "greater amount of circulating even the possibility of issuing tickets is valued higher denomination."
The disappearance of the duality will force the conversion of circulating CUC to Cuban pesos, so that bills with highest value than existing 100 CUP will be required. That is why financial institutions must make great efforts to achieve monetary unification.
Last August, the Central Bank of Cuba announced the future ticketing with new security watermarks on paper currency Cuban pesos, the only ones that will remain in circulation after unification.
Similarly, Medina said the agency seeks to promote the use of magnetic cards by establishing POS terminals in "certain places" in order to "avoid the use of cash and facilitate operations."
The Central Bank of Cuba is studying other aspects, such as indicators that measure the money supply, "which provide symptom of how far it is correct or not the existing traffic in the population and in the corporate system."
Until December 2013, the Cuban government covered its budget deficit by printing money. "Funding that means putting money that does not come from the production of material goods or securities in circulation and that does not allow lower prices," said Murillo this government practice in February 2014.
Rules of rates for an economy without CUC are known since March 2014, following its publication in a resolution of the Ministry of Finance and Prices. This document requires that the end of the dual currency will occur on a date called the "Zero Day".