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CUBA: Raul Castro’s First Year – Whispers of Change

Patricia Grogg

HAVANA, Feb 25 2009 (IPS) - As Cuban President Raúl Castro completes his first year in office, although a few of the “structural and conceptual” changes he promised have materialised, the pace of reform remains slow, deflating expectations and contributing to pessimism among the people of this Caribbean island nation.

“Enthusiasm is waning, and not much progress is evident,” an expert on economic and labour issues who wished to remain anonymous told IPS.

Those who are more optimistic remind people that the president has said on more than one occasion that haste and excessive idealism would be avoided.

“One year is nothing in the life of a country, especially when there is so much to be done. But I am aware that many of us wish things would happen more quickly,” said a 55-year-old university professor who is an active member of the governing Cuban Communist Party (PCC).

Castro was elected president of the Council of State on Feb. 24, 2008 after his elder brother, Fidel, declined to stand again for the post he provisionally surrendered in July 2006, due to severe health problems.

In a Jul. 26, 2007 speech, Raúl Castro, then interim president, raised hopes when he recognised the difficulties being faced by the people of Cuba, and talked for the first time about introducing ” whatever structural and conceptual changes are necessary” to increase declining agricultural yields in order to curb food prices.

Meetings were held around the country for the people to debate the points raised in the speech – a process encouraged by Castro himself – and a long list of concerns and problems requiring changes was produced.

Among the proposals presented by the public meetings were demands for the PCC to become more efficient and functional, and for state and government institutions to follow suit.

Three hurricanes battered the island in quick succession in 2008, leaving damages of nearly 10 billion dollars in their wake. The devastation brought additional tensions to the first 12 months of government of Raúl Castro and may have contributed to delaying the pace of reforms.

“None of the issues that I have spoken about recently has been shelved. Partial measures have been implemented as circumstances permitted, and we will make progress, without haste or excessive idealism, as resources become available and the necessary studies are completed,” the president said in December.

The reforms adopted by Castro during his first year as president began with the lifting of restrictions on sales of computers and some household appliances, such as DVD and video recorders, electric slow-cookers and motorised bicycles.

The unwritten rule banning Cuban citizens from staying at hotels reserved for foreign tourists was also struck down. And Cubans can now buy mobile phones and related telephony services. Such luxury goods and services have to be paid for in dollar-pegged convertible Cuban pesos (CUC), rather than national pesos.

These economic measures were seen as restoring rights and freedoms, especially in the case of access to the hotels.

Small farmers have also been allowed to make productive use of idle state land, and can now buy agricultural inputs direct from stores, which charge in hard currency (CUC). Some economists view these changes as structural reforms, because they break with the concept of centralised supply through farming cooperatives.

Permits to run private transport services, mainly in rural areas where public transport is deficient, have been re-introduced after being discontinued in 1996. They are signs of an expansion of self-employment opportunities that, although regulated, are independent of the state.

A wage system that links earnings with productivity through results-based bonus payments has been instituted, to equalise remuneration policies between companies that have adopted better management practices to improve efficiency and those that have not. But so far its application has not been “significant,” according to experts.

Economist Omar Pérez Villanueva said that people are looking forward to structural measures that will allow productive forces to develop and raise production. This would pave the way to gradually eliminating the dual currency system with both CUC and national pesos in use, which is another pending issue.

Wages are paid in regular Cuban pesos, but many basic needs must be paid for in the convertible CUC, the only legal hard currency on the island. An answer to this thorny problem will probably have to wait until the Sixth Congress of the PCC, defined in the constitution as “the highest leading force of society and the state.”

Party congresses are entrusted with the task of analysing the previous five years and setting guidelines for the next five-year period. The Sixth Congress of the PCC was due to be held in 2002, but has been delayed. Castro announced that it will take place in late 2009, although it has not yet been officially convened.

President Castro is the Second Secretary of the PCC’s Central Committee, while Fidel, as its First Secretary, is consulted on all matters of strategic importance for the country.

Changes in property regulations that may lead to permission to buy and sell houses and cars, and the possible lifting of migration regulations that limit Cubans’ freedom to travel abroad, are some of the measures that are still under consideration.

While his proposals for streamlining the state into “a more compact and operational structure” come to the boil, President Castro made several cabinet changes this year.

On Feb. 19 he promoted three of his ministers to vice presidential rank in the Council of Ministers, the highest executive and administrative body in the government of Cuba, in order to “distribute control and coordination of the administrative organs of state more effectively.”

Abroad, Castro has scored a number of diplomatic successes, travelling to Venezuela, Brazil, Russia, Angola and Algeria. Cuba formally joined the Rio Group of Latin American nations, the main regional policy coordination forum, in December, and has hosted visits by several Latin American presidents in the past two months.

The consolidation of its international position places the government in a better negotiating position to deal with any changes in U.S. policy towards Cuba that may be decided by the new incumbent at the White House, President Barack Obama, in line with promises he made during his electoral campaign.