Caribbean & Central America - February 2012 (ISSN 1741-4458)

The labour ministry reports that 362,355 people are now registered as self employed, double the number registered in 2010. Most of these new entrepreneurs are concentrated in Havana, along with the provinces of Matanzas, Villa Clara, Camagüey, Holguin and Santiago de Cuba. Most self employment permits (75%) are issued for the food service sector (food kiosks, street stalls, restaurants), followed by the transport service sector (taxis) and the housing sector (rentals/lodging). Of the self employed, 66% work only in the private sector; another 16% are retired people hoping to earn additional income and the rest (18%) continue in state employment while they try to get their new ventures up and running. The government aims to cut 170,000 state jobs in 2012, according to Economy Minister Adel Yzqueirdo Rodríguez. Alicia Bárcena, the executive secretary of the UN’s Commission for Latin America and the Caribbean (Cepal) said on 7 February in Havana that Cepal viewed “with great enthusiasm” the economic reforms in Cuba. Bárcena praised what she said was the effort to put a proper domestic productive apparatus in place, and to give “a socio-economic density” to the country project.  She added that rapid growth was not to be confused with development and that Cuba was right not to depend on external inputs to develop. Bárcena, who is Mexican, praised the Cuban model as “equitable and solid”. She also praised the efforts to put in place a gradual and progressive fiscal mechanism, noting inadequate and regressive fiscal systems in the majority of Latin American countries. However a Havana-based dissident economist, Oscar Espinosa, argues that the limitations on the timid economic liberalisation process are stifling. “There is no incentive for growth. They [the new private sector operators] are bonsai-companies, of bare survival”, he said in an interview in January, singling out punitive tax rates as key disincentives.

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