How ‘filthy’ capitalists are breathing life back into Cuba: Havana awash with private investors finally allowed to pump money into economy after years of economic embargos
Long beset by a financial crisis, fuel shortages and a collapse in domestic production, Cuba has slowly come to embrace its capitalists to save itself from total collapse.
After years of being the only communist nation in the Western Hemisphere, the Latin American country has begun to adopt capitalist views and welcome “dirty” capitalists back into the economy.
Taking advantage of relaxed government restrictions on private entrepreneurship, Cubans have successfully created 10,200 new businesses since 2021.
According to CNNIn 2021, more than 600,000 Cubans worked in the private sector.
Taking advantage of relaxed government restrictions on private entrepreneurship, Cubans have successfully created 10,200 new businesses since 2021
Customers shop at Home Deli, a privately owned supermarket in Havana
Asley Alfonso Gil works at his private bicycle repair business in Cienfuegos province, Cuba
In the past year alone, modern supermarkets have opened all over Havana with every food imaginable.
Factories producing toilet paper in Marianao, large-scale dairy manufacturers making ice cream and online private supermarkets providing home delivery are also emerging across the country.
In 2023, there were about 1.5 million people employed in the private sector, which together with government imports amounted to about $1 billion each, according to U.S. State Department figures. New York Times.
The new private workforce currently amounts to almost half of the total workforce on the Caribbean island.
Cuban private entrepreneur Idián Chávez and his wife Ana unpack industrial equipment for their new toilet paper factory in Havana
Furniture made in Cuba by Dforja, a company founded by Anabel Gonzalez and her husband, Luis Betancourt
People walk in an open-air market where the government allows licensed vendors to sell their goods in Havana. The entrance sign says ‘Sales area for self-employed persons’ in Spanish
Pavel Vidal, who studies the Cuban economy and is a university professor in Colombia, told the NYT: “Never has the private sector been given so much room to operate in Cuba.
‘The government is bankrupt and therefore has no choice but to invite other actors.’
This shift in policy is due to the Cuban communist government’s inefficiency and mismanagement in managing state finances and rising inflation.
The monetary reform, implemented in January 2021 to end the dual currency system, failed to establish the Cuban peso alone and led to an estimated 500 percent inflation in 2021 and 2000 percent in 2022.
Yousy Oliva, 34, serves pizza at a private restaurant in Havana
A bartender works at Na Zdorovie!, a Russian-themed restaurant and bar in Havana
Brothers Ricardo (left) and Oscar Fernández (right), owners of Deshidratados Habana (Dehydrated Havana), have been running their private dried food business for two years
On average, a one kilo bag of potatoes can cost about ₱8 (Cuban pesos), while a bottle of good red wine can cost ₱15.
Even daily necessities like toilet paper cost around ₱6 for a pack of 10 rolls, a liter of whole milk costs ₱4.64 and a kilo of tomatoes can cost around ₱5.76.
Government employees and white-collar professionals, including doctors and teachers, are estimated to earn $15 per month, which amounts to almost ₱360.
By comparison, private sector workers typically earn nearly five to 10 times that amount.
It is widely believed that people who can easily afford amenities or even basic needs receive money from abroad, work for other private companies or are employed as diplomats.
Yoandris Hierrezuelo, 38, runs a fruit and vegetable cart in Havana’s Vedado neighborhood and earns about $5 a day said: ‘You have to be a millionaire to live in Cuba today.
‘The state can no longer meet the basic needs of the population.’
Keytris Leyba, an employee of the Atres Cooperative, cleans furniture made of plastic or ecological wood in Matanzas
Customers meet at the bar and nightclub La Fabrica de Arte Cubano in Havana
The new private labor force currently amounts to almost half of the total labor force on the Caribbean island (representative image)
Although Cuba’s private sector appears to be booming, it only accounts for about 15 percent of gross domestic production.
The sector also continues to face challenges from the state government.
Many new entrepreneurs wonder whether the communist regime will allow them to “expand quickly and freely enough to meet the challenges” — especially given the country’s long history of banning free-market practices once economic pressures subside .
While Cuba’s new capitalists are steeped in skepticism, Miami’s anti-communist Cuban exile community is also suspicious of the country’s government.
Republican Rep. Maria Elvira Salazar, one of three Cuban Americans in South Florida in Congress, said in an interview: “The Cuban regime is still in power, and there is nothing that proves to me that they are willing to to give a cent. giving some of that market share to someone other than themselves’
But in light of the current fuel shortage, aging power grid, and a significant decline in food grain production, citizens have put their doubts aside and embraced capitalism to secure a future for themselves.