Tabacuba's Deceptive Deals: What Lies Behind Selling Mercedes-Benz to Cuban Farmers?

Tabacuba has launched what appears to be a program to incentivize tobacco farmers in Cuba. However, upon closer inspection, it reveals itself as a financial trap designed to deplete the freely convertible currency (MLC) accumulated by farmers, without delivering the true value of their production.

The recent delivery of six Mercedes-Benz cars to Cuban tobacco farmers is shrouded in a scheme of unequal exchange, where producers pay for German cars with virtual currency. At a glance, it seems beneficial, but the reality is they never physically handled a dollar from their production. So, where is the money? What does Tabacuba do with the millions of dollars it earns annually?

The Tabaco Paradox

Tobacco remains Cuba's leading export commodity. In February, President Miguel Díaz-Canel emphasized that the country has a special economic framework for this sector, which is closely monitored. "We are closely following this economic scheme because it seems to be the best we have nationwide. There's an adequate return, and everyone involved in production is benefiting," he asserted.

During the Habano Festival in March, it was revealed that Tabacuba's global sales reached a record high in 2024, generating $827 million in revenue, a 16% increase from the previous year. The company's most robust markets include China, Spain, Switzerland, the United Kingdom, and Germany.

The Illusion of Incentives

This week, Tabacuba unveiled enticing information for Cuban producers, demonstrating how the socialist enterprise and its foreign partners can sell Mercedes-Benz vehicles to distinguished farmers as a kind of "incentive" to be paid in MLC. Additionally, these farmers have the "valuable" opportunity to purchase Chinese agricultural vehicles, again using the MLC paid for their crops.

Yet, this so-called incentive is actually an imposed barter system, rooted in a crucial fact: the MLC is not real money, although the government has tried to convince the Cuban people otherwise.

The MLC Conundrum

The MLC is a virtual currency created by the regime, supposedly backed by dollars, but farmers cannot physically access or freely convert it. Essentially, the MLC is merely a figure on a screen used by the state as an accounting unit, which is losing its real purchasing power in Cuba, particularly as it has been phased out of most state stores and platforms.

Tabacuba, through its importer MCV Comercial S.A., acquires vehicles abroad and sells them to farmers at an exchange rate of 1 MLC = 1 USD, a rule established by the regime in 2020, which also mandated that money could only be withdrawn in Cuban pesos (CUP) from those accounts.

In August 2025, the informal market sees the dollar at 410 CUP, while the MLC lingers at just 195 CUP. This means farmers have significantly less money in their accounts than the state admits, and someone has been deceived over the years, even though MLC accounts keep growing without clear benefit to the producers.

A Strategic Move to Drain MLC Accounts

This maneuver by Tabacuba comes precisely as the MLC's value plummets, and the populace fears it will follow the same fate as the now-defunct CUC. Many farmers have amassed substantial sums in MLC, which are now useless for imports, shopping, or conversion into cash dollars.

Marino Murillo, the architect behind the Tarea Ordenamiento, the end of the CUC, and other economic blunders, leads Tabacuba. With foresight into the impending collapse of the MLC, he launches this operation to recover those funds in exchange for state-imported goods under undisclosed conditions and agreements.

This anticipatory move aims to prevent producers from demanding payment in liquid currency or pressing for deeper reforms to receive their rightful earnings in dollars—money they have never held.

The Illusion of Reward and Upside-Down Economics

While the initiative of offering Mercedes-Benz cars is marketed as a reward for tobacco farmers, it is, in reality, a method of control and extraction of value. A producer from Pinar del Río shared with 14Ymedio that many farmers were consulted about this exchange, but most declined. Only about 20 out of 300 producers agreed. The reason is simple: the deal is unfavorable, and they want their foreign currency.

Exchanging MLC for dollars at a 1:1 rate for vehicles results in a substantial loss and means relinquishing the little purchasing power they have in exchange for goods they cannot easily resell or use as liquidity. While a car is useful, it does not replace the right to freely access the money they generated—the thousands of dollars owed to them.

The Underlying Problem: State Retains the Dollars

Farmers produce Cuban tobacco sold abroad for millions in dollars, euros, or other strong currencies. However, the producers never receive these revenues in hard currency. The state retains the dollars, converts them into MLC, and now aims to absorb these MLC before their value plummets to zero.

This model isn't new. In 2024, Tabacuba had already offered Chinese tractors in exchange for the MLC generated by tobacco production. The incentive was for producers to purchase tractors at 26,000 MLC, while the actual market price for these vehicles was around $9,000.

A Luxury for a Few and a Symptom of Growing Inequality

While "distinguished" farmers receive cars as incentives, most Cuban workers cannot even dream of buying a car. The stark contrast between widespread scarcity and these selective distributions highlights the structural inequality of the Cuban system, where only those managing strategic sectors or aligned with power access privileges.

The "incentive" is not an incentive. It's a means to placate producers without granting them their due, disguising control as a reward. It's a meticulously devised operation to extract value without relinquishing power.