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Cuba today: Congresspeople, capitalism, pastors & pianos

A Weekly News Update on the Americas Supplement, 28 January 1996

STUDYING CAPITALISM IN CHINA AND VIETNAM

Cuban president Fidel Castro traveled more in 1995 than in any other year since the 1959 Cuban Revolution, according to the British daily Financial Times. [FT 1/4/96] The highlight was Castro's two-week tour of East Asia starting on Nov. 30 with the Cuban president's first visit to China. During his ten-day stay in China, Castro flattered his hosts by saying that his country was "building socialism with Cuban characteristics." Chinese officials describe their government's efforts to develop a free- market economy under Communist Party control as "socialism with Chinese characteristics." [New York Times 12/1/95] Cuba and China were sharply critical of each other during the 1970s, when Cuba sided with Vietnam and the Soviet Union against China. [FT 11/27/95 and 1/4/96] But now China is one of Cuba's principal trading partners, along with Russia, Spain, Mexico and Canada. The National Bank of Cuba (BNC) sets the total 1995 trade between the countries at $3.613 billion, and the Chinatex company is considering opening plants in Cuba to produce for export. [Inter Press Service 12/27/95]

Castro then made his second visit to Vietnam, which began a program of free-market adjustments in 1986. On Dec. 9 Castro visited an apparel plant that manufactures French-designed clothes for export; afterwards, he told his hosts that "audacity and wisdom" were needed to save socialism in the current situation. Vietnam announced that it will supply Cuba with 100,000 tons of rice in 1996. [La Jornada (Mexico) 12/10/95 from AFP, Reuter, EFE, AP and Prensa Latina]

FREE MARKET REFORMS CONTINUE

In mid-October the government began allowing Cubans to buy and sell foreign currencies for the first time in more than 30 years. [NYT 11/9/95] Until 1993 Cubans were not allowed even to own hard currency. Now many tourist sector workers are paid in dollars, and mining and sugar industry workers get small hard-currency bonuses. As of Jan. 1, Cubans are paying a graduated income tax on hard-currency earnings, from 10% for those making $2,400 a year to 50% for the tiny number that take in more than $60,000. The Cuban Revolution abolished personal taxes in 1959. [FT 11/27/95; NYT 12/3/95] In 1994 the government established the International Bank of Commerce Ltd (BICSA) to encourage financial flexibility and to break the National Bank's monopoly. Eleven foreign banks now have representatives on the island. Agriculture has moved rapidly from the former system of large state-own companies. There are now 3,000 cooperative basic production units, 1,161 agricultural cooperatives and 86,000 private agricultural producers. [IPS 1/2/96] Cuban officials say the new policies are working. They expect their 1995 figures to show a 2.5% growth in Gross Domestic Product (GDP), after a 14.9% fall in 1994. [LJ 12/21/95 from Ansa, AFP, DPA and Reuter]

This report was produced by the Weekly News Update on the Americas and New York Transfer News Collective. Please feel free to reproduce any of this material if proper credit is given.

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