Monday, May 18, 2015

Cuban Economy - A Very Brief and Simplistic View!

Cuba has two currencies, the Cuban Convertible Peso (CUC) and the Cuban Peso (CUP).  The CUC is worth about £0.60 and is used mostly by tourists and the locals use the CUP - there are about CUP24 to the CUC1, which makes a CUP worth about 2.5p.

Despite rumours to the contrary, both types of Pesos are legal tender in Cuba and both are completely available to anyone – including foreigners.  However shops usually only accept one type of currency;  shops where Cuba's home grown produce etc is sold are generally CUP shops and those which sell imported goods charge in CUC.

The majority of our dealings were in CUC, although one very honest baker did give me change in CUP when I offered CUC1 (60p) for a loaf of bread - the price in CUP being equivalent to about 5p.

The government undertakes to provide 60% of everyone's food and this is done by ration books.  So although no one is actually starving, the rations supplied are quite basic and there isn't much choice - rice, beans, pork, being the staples.  As someone put it "not enough to feast or get fat on".

Housing, electricity and water are also very cheap and education and healthcare are both free.

Wages are very low by Western standards and there is a thriving black market economy which the government appears to turn a blind eye to as it knows it cannot afford to clamp down on it.

The breakup of the USSR in early 1990s had an enormous impact on Cuba and their "Special Time" lasted about 7 years, during which time life was very, very tough with little to eat and a fractured economy.  Alex can remember his mother serving cloth sandwiches!

Nowadays, nothing is wasted or thrown away if it can be repaired, we saw cobblers stitching trainers back together whereas we would have just replaced them.  And of course the wonderful old American cars are somehow kept on the road and if they do finally fall apart, are recycled into something else - a lawnmower for example.





We also visited several shops where the shelves were somewhat empty and also a distinct lack of product choice.



And with a little bit of ingenuity, anything can be recycled.