Corona Daily 040: Cuba: Museum of Communism

I call Cuba the museum of Communism. My Russian friends, who have visited Cuba, confirm it. Unlike China, Cuba has remained faithful to the Soviet communist model. The fall of USSR in 1991 was the first big shock to Cuba. The Soviets were always willing to finance and subsidize the island situated so close to their arch-enemy. The second great shock was last year, when the pandemic began.

Currently, Cuba faces an unprecedented food crisis. Grocery shops are empty. People try to find food in the black market, online or offline. 70% of the food is imported. With the Cuban peso going down, prices are prohibitive. Farmers refuse to sell because they want to eat the food they grow.

On 24 June, the UN general assembly condemned US sanctions on Cuba. All countries except the USA and Israel condemn the sanctions. Such condemnation changes nothing for ordinary Cubans. This annual ritual has been going on since 1992.

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In 2001, sanctions exempted food. US became the largest exporter of food to Cuba. In the last twenty years, exports were the lowest in 2020. Because the Cuban government has no hard currency to pay for food. Cuba relies on more than 4 million foreign tourists to bring in respectable currencies. Tourism, 10% of Cuba’s GDP, disappeared in the pandemic. Till last March, there were ten daily flights between Miami and Havana. Now, one needs to search for a flight.

As if this was not enough, Cuba suffered a drought last year. Dollar shortage already meant fertilizer and fuel shortage. Sugar harvest, Cuba’s main export, was the worst in the last 100 years.

Food producing companies in Cuba earn in Pesos, pieces of paper that are worthless outside Cuba. But the same companies must pay for imports in hard currency. Farmers, by law, must sell their harvest to the government at uncompetitive prices.

State owned bakeries, and most of them are state owned, are replacing imported wheat flour with local corn, pumpkin or yucca. Consumers complain bread now tastes like soggy corn. Some cities have banned sale of biscuits to save on flour imports.

Fuel and trucks are both in shortage. Domestic transport of the imported food is a challenge. What took two weeks from the USA in the past now takes four months. In the process, wastage is high.

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Government is becoming desperate for American $. Since February, foreigners and some Cubans must pay the seven day mandatory quarantine stay in US $. Cubans living abroad are encouraged to pay online in dollars to buy food or gifts for their relatives and friends in Cuba. (One consultant commented that Cuba has 11 million hostages, and Cuban exiles are asked to pay the ransom.)

On 10 June, the central bank of Cuba announced Cubans were prohibited from depositing US$ into accounts from 21 June. In a communist country, US$ is the currency of the black markets as well as savings of the ordinary people. The panicked Cubans queued outside banks for days. This was the government’s attempt to suck all the dollars into the banking system.

Cuba owes some $3.5 billion to foreign lenders. For the last two years, Cuba has been unable to make payments. In June, Ricardo Cabrisas, Cuba’s deputy prime minister, was in Paris trying to renegotiate the debt. An ultimatum from the creditors was possibly the reason behind Cuba trying to collect US $ from ordinary citizens.

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The silver lining is Cuba’s health system. Cuba is the world’s smallest nation to develop vaccines, not one but many. Its ambition is to produce enough to inoculate its 11 million citizens, and then export to friendly nations like Venezuela and Iran. (Enemy’s enemy is a friend).

Since Fidel Castro’s time, Cuba has invested disproportionately in public health. The government spends $300-400 per person on health care. Unfortunately, a Cuban doctor is paid $64 a month, and told he belongs to a noble profession.

Trump, in his last weeks in office, reclassified Cuba as a State sponsor of International terrorism. This has restricted its access to simple things like syringes. Cuba requires 30 million syringes for its vaccination campaign, but has managed to procure only 10 million.

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Cuba is a tragic example of how ordinary citizens suffer in a defective political system. Ideology can never feed people.

Ravi