What's Next for Cuba?

Wednesday, May 29, 2024 by Emma Garcia

What's Next for Cuba?
Cuban child looking at store window - Image © CiberCuba

The Biden administration has recently extended a lifeline to Cuban entrepreneurs by introducing new amendments through the U.S. Treasury Department aimed at supporting them. While these measures are well-intentioned, it's important to acknowledge that they fall short of creating a significant impact on the average Cuban's life.

Importing Chicken Doesn't Create Wealth

The importation of essential goods like chicken is not a sustainable solution. It doesn't generate wealth or promote internal economic development. While it's a crucial first step, it does not address the underlying causes of Cuba's economic crisis. The policies implemented during the Obama administration demonstrated that limited openings did not bring about real change for the Cuban people. We witnessed an increase in hostels, restaurants, and small businesses, as well as cruise ships, Chanel fashion shows, and Hollywood film productions. However, for most Cubans, especially those without access to remittances from abroad, daily life remained a struggle.

More Business for Importers, But Little Real Change

The new amendments will allow some to import more products and possibly open bank accounts in the United States. This could benefit a select group of importers and entrepreneurs, but what about the average Cuban who doesn't receive remittances? For them, life on the island will continue to be extremely challenging. We might see more luxury cars and well-stocked supermarkets in major cities, but millions of Cubans will not have access to these products. The apparent signs of prosperity will not translate into real improvements for the general population.

To be clear, these measures will yield some important results for Cubans. The competition among hundreds of small and medium-sized enterprises (MiPymes) to sell their products may drive prices down, but this has its limitations. Merchants can only compete with their profit margins, as the costs of products on the international market and their importation cannot be avoided. Imported goods from the U.S., Europe, or Panama will never be cheap for the average Cuban living on a salary.

The Need for True Economic Opening

The U.S. government is neither the cause of poverty in Cuba nor its solution. The Cuban regime must understand that the economy cannot be sustained solely through imports and remittances. A genuine economic opening that allows for the creation of internal wealth is required. The current measures only perpetuate dependence on remittances and state-controlled foreign trade. Without comprehensive economic reform that includes market liberalization and the removal of bureaucratic obstacles, the new amendments will be insufficient.

A Call to the Regime

The ball is in the regime's court. It is their responsibility to capitalize on this opportunity and implement deep changes that genuinely benefit the entire population. Without significant economic opening as a counterpart to these measures, the effect will be minimal. Ultimately, we could see a return to more stringent policies with the arrival of less favorable administrations in the United States. We saw this with Trump, and now a second Trump term is on the horizon.

We hope the regime does not make the same mistake twice. Concrete steps must be taken to unlock the economic potential of the Cuban people. Without true economic reform, any improvement will be superficial and temporary. Cubans deserve more than mere palliatives; they deserve the opportunity to thrive in their own land.

Key Questions About U.S. Amendments and Cuba's Economic Future

In light of the new amendments introduced by the U.S. Treasury Department, many questions arise regarding their potential impact on Cuba's economy and daily life. Here are some key questions and answers to help clarify these issues.

How will the new U.S. amendments affect Cuban entrepreneurs?

The new amendments will allow some Cuban entrepreneurs to import more products and potentially open bank accounts in the United States, benefiting a small group of importers and business owners.

Will these measures help the average Cuban?

Unfortunately, the average Cuban who does not receive remittances will likely continue to face significant challenges, as these measures do not address the root causes of Cuba's economic crisis.

What is needed for a true economic change in Cuba?

A genuine economic opening that includes market liberalization and the removal of bureaucratic obstacles is essential for creating internal wealth and reducing dependence on remittances and state-controlled foreign trade.

What could happen if the Cuban regime does not implement significant economic reforms?

Without significant economic reforms, any improvements will be superficial and temporary. There is also a risk of returning to more stringent policies if a less favorable administration comes to power in the United States.

© CubaHeadlines 2024

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