Cooperative Cuba emerges

As part of the economic "updating" programme, and as part of a general effort to speed up economic growth, the Cuban government announced on 28 June that that 124 new co-operatives would begin operations on 1 July in the agricultural, construction, transportation, recycling and produce marketing sectors. Of the 124 co-operatives, 99 will operate farmers’ markets in the western provinces of Havana, Artemisa and Mayabeque, two will focus on the recycling sector and 12 will be involved in construction activities. Another six will offer vehicle maintenance services while the remaining five will be involved in passenger transportation, such as taxi cabs and school buses. The new co-operative markets will function independently of state entities and businesses, be free to set prices in cases where they are not fixed by the State and divide profits as they see fit. “Through this new measure, we are hoping to manage as (private) cooperatives those state-run economic activities that have not been efficient,” Grisel Trista Arbesu, head of the Business Improvement Group of the Permanent Commission for Development and Implementation, said. “The measure also allows the State to gradually extricate itself from activities that are not of vital importance to economic development.”
The Cuban government hopes the new cooperatives will boost productivity and allow the State to cut public spending by reducing the number of people on the government payroll. Co-operatives can play “an important role in the country’s economy, although the main role will continue to be the socialist state enterprise,” said Ruben Toledo, a colleague of Grisel Trista Arbesu. Co-operatives are not new. There are several thousand agricultural co-operatives in Cuba. However, this is the first time that co-operatives have been created for non-agricultural activities. According to the government, more than 430,000 people now work in the non-state sector. This figure excludes those employed in agricultural cooperatives and around 400,000 small farmers.

Plan is "advancing"

Cuba’s reform plan is “advancing and the results can be seen”, President Raúl Castro declared after reports on individual reforms were made at a meeting of the Council of Ministers on 28 June. “We are moving at a faster pace than can be imagined by those who criticize our supposed slow pace and ignore the difficulties that we face,” he said, without making clear who he was referring to. President Castro has always insisted that the reform plan – approved by the National Assembly in April 2011 – would be implemented gradually “without haste”. However, the reforms have yet to translate into faster economic growth. The growth target for this year is 3.6%. Although GDP growth for the first half of this year is estimated at 2.3%, compared to 2.1% for the same period last year, Economy and Planning Adel Yzquierdo now expects the economy to grow by 2.5-3% in full year 2013. The economy grew by 3% last year. The slower than predicted growth rate is linked to a number of factors, including Hurricane Sandy, which caused an estimated US$2bn in damages last year, as well as “the deficiencies that are part and parcel of the Cuban economy”, including low productivity, labour shortages, and the global and regional economic situation, the Minister said.