Wednesday, May 2, 2012 at 4:45 PM
Cuban President Raul Castro's economic reforms are taking on a new urgency as the island's biggest benefactor, Venezuelan President Hugo Chavez, battles cancer and faces re-election. Havana says nearly half of Cuba's economic activity will shift to the private sector in the next several years.
Related ArticlesVenezuelans Tune In For Scoops On Chavez's Health
In Venezuela, one journalist is gaining a following by breaking news on Hugo Chavez's health.U.S. Watches Closely As Oil Drilling Begins Off Cuba
A Spanish company has begun drilling for oil in Cuban waters, just 80 miles from the Florida coast.U.S. Travel To Cuba Grows As Restrictions Are Eased
It's now easier for U.S. citizens to travel to Cuba, though some U.S. lawmakers are critical.Entrepreneurs Emerge As Cuba Loosens Control
From food stalls to printing companies, private businesses are now commonplace in Cuba.In Cuba, A Used Car Is No Bargain
With very few cars entering the Cuban market, used vehicles are selling for astronomical prices.In Cuba, Door Opens To Residential Property Market
Raul Castro's most significant economic reform is spurring the refurbishment of dilapidated homes.In Cuba, Dial-Up Internet Is A Luxury
Cubans are being promised greater Internet access, but for now, getting online remains a challenge.
Socialism has been Cuba's official economic policy for more than a half-century, and some 85 percent of the Cuban workforce is employed by the state.
But that is changing fast. Communist authorities say that nearly half of Cuba's economic activity will shift to the private or "non-state" sector in the next four or five years.
Those plans signal a new urgency to Cuban President Raul Castro's economic reforms, and one reason is that Venezuelan President Hugo Chavez, the island's biggest benefactor, is battling cancer and facing re-election in October.
The new approach was evident in this year's May Day parade in Havana, which was a little different from the Soviet-style processions of the past.
Between the drumming and the dancing girls writhing around on floats in tight-fitting tops, it was hard to hear Cuban officials exhorting workers to greater efficiency and more discipline.
The state workers, duty-bound to attend the parade, were making the most of it, even if there wasn't a lot to celebrate. Average salaries in Cuba remain stuck at about $20 a month, with officials saying wages can't rise until productivity increases.
Still, there was a growing contingent of new Cuban workers on the march this year: self-employed entrepreneurs and private business owners like Lazaro Enciso. Carrying a banner with some of his 20 employees, he said he'd come to show support for Raul Castro's liberalization moves.
"This is a new way to create jobs for our country," said Enciso, who runs a snack bar, a clothing shop and another business selling religious items. "As long as you're entrepreneurial, honest and revolutionary, there's no obstacle to success here."
Venezuelan Lifeline In Jeopardy?
As Cubans marched and chanted "Long live the revolution," the island's biggest financial backer, Venezuela's Chavez, was in a Havana hospital for another round of cancer treatments.
Chavez provides the island with two-thirds of its oil on favorable terms, along with more than $5 billion a year in exchange for the Cuban doctors and other professionals working in Venezuela.
Now, with Chavez so ill he has prayed to Jesus to spare his life on national television, Cuban economist Pavel Vidal says it's clear the economic reforms must move faster.
"Cuba's economy is small and, and from a political-economic standpoint, it's closed, with a high level of dependency on access to hard currency for growth," says Vidal. "A loss of support from Venezuela would send Cuba into a recession."
Vidal and others say the damage to Cuba's economy wouldn't be as severe as the sudden demise of the Soviet Union a generation ago. The island's relationship with Venezuela is more interdependent, and even if Chavez is no longer in power it might take time for their two-way trade to untangle.
Despite Changes, More Openness Needed
Still, the possibility is putting pressure on Raul Castro to broaden the reforms. Cuban entrepreneurs still can't contract directly with foreign suppliers or wholesalers, and the government only grants licenses in about 200 types of trades and businesses.
A Havana car wash is one example of Cuban entrepreneurs learning to diversify beyond selling snacks or renting rooms to tourists. But the driveway-sized business only has space to wash and vacuum one vehicle at a time, and it's always full.
Hildelisa Cespedes says her family is waiting to see if local officials will let them rent out a rundown garage around the corner that is owned by the state, the kind of arrangement Cuban authorities say they're still studying.
"If we had a bigger place, we could have more customers and hire more workers," Cespedes says. "We're ready to make the investment."
Cuba's uncertain economic outlook may find a new lifeline even if Venezuelan support dries up. A host of foreign companies are starting to drill for oil in the deep water off Cuba's north coast. If sizable deposits are found, the crude could take years to bring to market, but economists say Cuba's government would get access to fresh lines of credit right away. [Copyright 2012 National Public Radio]
This article is filed in: World News, News
Khaled El-Masri says he was mistakenly flown to a secret prison in Afghanistan by the CIA.
Civilians Flee, Soldiers Dig In On Sudanese Frontier
The U.N. is threatening both Sudans with sanctions if they can't reverse their escalating feud.
How To Address France's New, Unmarried First Lady
France's new president was inaugurated Tuesday, and he's moving into the presidential palace with his longtime "companion." Host Michel Martin and the Beauty Shop ladies weigh in on political protocol when it comes to heads of state, politicians and their unmarried significant others.
At Trial, Serb Gen. Mladic Taunts Survivors With Throat-Cutting Gesture
Charged with 11 counts of genocide, crimes against humanity and war crimes, he remains defiant.
Atlanta Opens New International Terminal
Officials hope the facility means more international businesses will choose to locate in Georgia.
News updates from WGBH