2023-05-29 22:07:15
The “private” supermarkets are well supplied and with prices unaffordable by the majority of Cubansand that operate as stores that compete with government dollar businesses in Cuba, They might be in the sights of the authorities.
This, judging by the comments of the Deputy Prime Minister and Minister of Economy, Alejandro Gil Fernándezwhen intervening in the Second Extraordinary Session of the tenth legislature of the National Assembly of Popular Power.
After the government insisted that its vote for the development of small and medium-sized private enterprises, or MIPYMES, would support the growth of local productions, Gil had to admit that this cannot be achieved today.
“We have been appreciating a tendency in the private sector to buy and sell final goods”not raw materials to create productions in the country, he said, quoted by the Official site Cubadebate.
In numbers, he commented, private entrepreneurs have generated 4,788,500 dollars in exports and 270,294,100 in importsa huge difference. Of these, 61.6% were made by MSMEs, which in the first four months of 2023 imported products worth 166 million dollars.
“We have been appreciating in recent years an increase, month following month, in the level of imports of non-state management forms. Due to the pace that has been taking place in the last two months, they have exceeded 80 million. At this rate we will surpass the figure of more than 1,000 million in the course of the year, “he commented.
Gil Fernández said that “These goods ready for sale that are imported are placed for sale to the population, many times at high prices. This is a matter that we must deepen, because although it is true that it is approved that the new forms of management can import for their production, in recent months there has been a trend towards imports for direct marketing.”
“We are facing accumulated inflation, for various reasons. Some cannot be solved now, because they have to do with the purchase at high prices of the raw materials that we have to import,” he said, before assuring that an oil ship that cost in 2019 eight million dollars now costs 16 million.
But he acknowledged: “The speculation has to do with taking advantage of the difficult situation in the country to resell the products three and four times above their cost. That doesn’t solve any problem for you. We have to face this and resolve it,” he assured, without specifying if this is also valid for the dollar stores managed by the business conglomerate of the military GAESA or the virtual stores, through which emigrants make purchases for their relatives on the Island.
Of course, Gil Fernández did not mention that the Government itself sells products in dollars with a profit percentage well above their import cost. Just to mention one example, last February a Cuban denounced on social networks that the Government sells a 2.4-kilogram whole frozen chicken in MLC stores for 21.70MLC, at a rate of 8.80MLC per kilogram. In other words, 700% more expensive than the import price from the US.
In his speech, the minister emphasized: “Excessive lucrative profits cannot exist, and it is a responsibility that we must faceand that it be invoiced and sold to the population”.
The other side of the coin is state companies. Gil Fernández said that in the first four months of 2023, 84% of these generate profits, although this does not mean that they operate at maximum capacity or that they are efficient and are providing goods and services to the economy.
He added that there are 285 state companies with losses126 less than those that were in this condition at the end of April 2022. But among these there would be “a group that we cannot say a priori that they are inefficient or unproductive, but rather that, in the interest of the country, they have capped prices so as not to contribute to the inflation,” he said.
He reiterated that progress is being made in the drafting of the Business Law, regarding which “timely” information will be given on its location in the legislative schedule.
To date, 8,012 new companies in the non-state sector have been approved, 7,947 of them MSMEs, 105 state-owned and the rest private, and 65 non-agricultural cooperatives have been established.
According to the figures he offered, today in Cuba the accumulated inflationwhich gives rise to the stratospheric prices of basic necessities, between January and April it amounted to 11.39%, while the weighted and interannual figure reached 45.4%comparing April 2023 with April 2022.
This skyrocketing inflation, which was left unchecked following the imposition in January 2021 of the economic package of the Ordering Task, means the impoverishment of Cubans, especially the elderly and retirees, who the Government promised that it would protect with the economic measures applied just during the worst of the pandemic.
At the suggestion of various economists that the authorities should increase wages to help alleviate the impact of the serious crisis, Gil Fernández reiterated an old justification: “If more money is injected with the same level of supply, prices continue to rise. We are aware that the level of pensions received by the people who dedicated their lives to this Revolution is not enough.”
But, once more, “increasing subsidies means more budget deficits and, in the long run, more inflation. Therefore, more production is needed, more efficiency, less resale, less diagnostics and more solutions.”
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