Cubans Urged to Work More to Combat Soaring Prices

Tuesday, July 9, 2024 by Isabella Rojas

Cubans Urged to Work More to Combat Soaring Prices
Sale in Cuba - Image © Cubadebate

The Havana regime has called on Cubans to increase their work efforts to tackle the high prices on the island, emphasizing that these prices cannot be reduced "at whim." In response to public criticism regarding an article from the official Cubadebate portal about the implementation of "maximum retail prices for high-demand products," the Ministry of Finance and Prices stated, "We must understand that prices reflect the recovery of costs and expenses of goods, whether imported or domestically produced."

"We cannot continue to think that prices can be whimsically reduced. If this happens, those who produce or purchase lose out and cannot sustain the reproduction process, and we will not have these goods in the future," the ministry stressed.

Ignoring the dire situation faced by thousands of Cubans, especially the elderly and disabled, the entity advises that "those who are unfortunately vulnerable and cannot cope with these prices should seek assistance from social security agencies. For the rest, we must increase our income through more work."

On Monday, the Cuban government announced the implementation of price caps on six basic high-demand products through a resolution published in the Official Gazette of Cuba. According to the resolution, the maximum retail prices would be: chicken pieces at 680 pesos per kilogram; edible oils (excluding olive oil) at 990 pesos per liter; powdered milk at 1,675 pesos per kilogram; pasta at 835 pesos per kilogram; sausages at 1,045 pesos per kilogram; and powdered detergent at 630 pesos per kilogram.

The resolution is presented as an effort to mitigate the impact of inflation on consumers. In response to public comments, the ministry added, "There are no magical solutions to the main concern of the people: ever-increasing prices." It clarified that in the formation of the capped retail prices, economic actors recognize up to a 30 percent profit margin over costs and expenses.

Recently, Lourdes Rodríguez Ruiz, the Deputy Minister of Finance and Prices of Cuba, held a tense meeting with entrepreneurs and directors of SMEs to inform them about the government's decision to cap the prices of essential goods sold in the retail network.

The regime's intention to cap prices was supposed to take effect on July 1st. However, the day before, the Cuban government revoked the decision to cap retail prices for a group of products sold by the private sector.

Previously, the regime had announced that it had prepared an army of 7,000 inspectors who would be responsible for ensuring compliance with the price cap regulations.

However, renowned Cuban economist Pedro Monreal analyzed the potential consequences of implementing price caps and argued that "instead of using the market to make the 'plan' more flexible, (the Cuban authorities) paralyze the market with the plan."

Understanding Cuba's Price Control Measures

In light of the recent price control measures announced by the Cuban government, many questions have arisen regarding their implications and effectiveness. Here are some frequently asked questions and their answers to provide more clarity on this issue.

What products are affected by the new price caps?

The new price caps affect six basic high-demand products: chicken pieces, edible oils (excluding olive oil), powdered milk, pasta, sausages, and powdered detergent.

Why did the Cuban government decide to implement price caps?

The Cuban government implemented price caps as an effort to mitigate the impact of inflation on consumers and address the public's concern over rising prices.

How will the price caps be enforced?

The Cuban government has prepared an army of 7,000 inspectors who will be responsible for ensuring compliance with the price cap regulations.

© CubaHeadlines 2024

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