News / Americas

    In a Reversal, Cuba Tries Price Controls to Tame Food Inflation

    FILE - Farmer Diogenes Cheveco, 73, picks beans on unused government land that farmers are allowed to use to grow food and raise livestock, on the outskirts of Havana, Cuba, March 3, 2015.
    FILE - Farmer Diogenes Cheveco, 73, picks beans on unused government land that farmers are allowed to use to grow food and raise livestock, on the outskirts of Havana, Cuba, March 3, 2015.
    Reuters

    Cuba is backtracking on some key agricultural reforms and experimenting with restoring price controls in the face of public demands that the government tame rising food costs.

    Prices are up because of limited production, poor weather and greater demand fueled in part by the market-oriented reforms championed by President Raul Castro.

    Those reforms, which the government says will modernize its socialist economic model, have led to growing numbers of wealthier Cubans even as most workers have seen food prices grow far faster than their state salaries.

    With new market rules in play, but limited food supplies, prices have floated toward what affluent Cubans can afford.

    Aware of public sentiment and eager to contain inequalities, the government is now buying, distributing and selling more food at fixed prices.

    It has ordered privately owned trucks to unload at wholesale markets instead of retail outlets, and some private street vendors have apparently been shut down to push more produce through controlled markets.

    In central Ciego de Avila province, the government will resume "the old strategy" of buying and transporting all crops once it receives more vehicles from the central government to get the job done, the local Communist Party weekly Invasor reported.

    Just west of Havana, in Artemisa province, the state this month opened outlets that sell basic foods at fixed prices, reversing a trend to get out of the retail food business. A similar plan was announced this week for the capital, creating at least one such market in each of its 105 districts, said Tribuna de La Habana, another official newspaper.

    At a military-run market in the Vedado district of Havana this week, there were mounds of plantain and onions and nothing else. Nevertheless, hundreds gathered to buy at low prices.

    "The government had to do something so I support this, even if there is less variety," homemaker Graciela Costa said as she waited in line. "Hopefully they can force speculators to lower their prices."

    FILE - Cuba's President Raul Castro arrives for the 70th session of the United Nations General Assembly at U.N. headquarters in New York, Sept. 28, 2015.
    FILE - Cuba's President Raul Castro arrives for the 70th session of the United Nations General Assembly at U.N. headquarters in New York, Sept. 28, 2015.

    From Fidel to Raul

    Raul Castro, who took over from his ailing brother Fidel in 2008, has pushed through market-style reforms to encourage more private enterprise, but he has vowed to move cautiously and maintain socialist policies.

    Fidel Castro routinely rolled back reforms when they started to create problems for the Communist government. This would be the first reversal under Raul since the Communist Party approved sweeping reform five years ago.

    In the National Assembly last month, some deputies called for a return to price controls and Castro himself said "a solution must be found" to bring prices in line with wages.

    "At the end of December after Raul spoke, all the street vendors disappeared and they still haven't returned," said Rosalia Leon, a pensioner from Havana. "There used to be a produce kiosk across the street from where I live and it shut down and still hasn't reopened. These days I have to look far and wide for what I need to eat."

    Cuban authorities have so far balked at imposing across-the-board price controls, but they have mounted a campaign against "unscrupulous middlemen and speculators" through state-run media, blaming those who buy directly from farmers, truck drivers and urban vendors for high prices.

    Such rhetoric from the past, which had disappeared until recently, is driven by a clear divergence between food prices and salaries.

    About 70 percent of Cuban workers are employed by the state with an average salary of $25 per month, but Cubans who receive remittances or work in growth businesses such as tourism are doing much better.

    Economy Minister Marino Murillo said poor and low income Cubans spend 75 percent of their salary on food, though they also receive free social services and subsidized utilities and pay no rent or mortgage.

    The cost of a family's basket of basic foods rose 15 percent in both 2012 and 2013 and 28 percent in 2014, according to the Union of Young Communists' newspaper, Juventud Rebelde.

    Government data showed average state wages rose just 13 percent in 2014 after barely increasing the two previous years.

    By restoring some price controls, the government hopes to push down market prices and signal it will not leave the least fortunate behind.

    Still, one Cuban agricultural expert, who asked for anonymity due to restrictions on talking with journalists, said the measures taken this year are futile except as short-term tactics.

    Despite reforms in agriculture under Castro, central planners had continued to assign scarce inputs and tell farmers what to plant rather than let the market decide, he said.

    "The problem is that the reforms are being implemented in a piecemeal and contradictory fashion," he said. "They decentralized distribution, but not production. Food production through to consumption is a chain that is only as strong as its weakest link."

     

    You May Like

    Video Obama Remembers Fallen Troops for Memorial Day

    President urges Americans this holiday weekend to 'take a moment and offer a silent word of prayer or public word of thanks' to country's veterans

    Upsurge of Migratory Traffic Across Sahara From West to North Africa

    A report by the International Organization for Migration finds more than 60,000 migrants have transited through the Agadez region of Niger between February and April

    UN Blocks Access to Journalist Advocacy Group

    United Nations has rejected bid from nonprofit journalist advocacy group that wanted 'consultative status,' ranking that would have given them greater access to UN meetings

    Featured Videos

    Your JavaScript is turned off or you have an old version of Adobe's Flash Player. Get the latest Flash player.
    Chinese-Americans Heart Trump, Bucking National Trendi
    X
    May 27, 2016 5:57 AM
    A new study conducted by three Asian-American organizations shows there are three times as many Democrats as there are Republicans among Asian-American voters, and they favor Hillary Clinton over Donald Trump. But one group, called Chinese-Americans For Trump, is going against the tide and strongly supports the business tycoon. VOA’s Elizabeth Lee caught up with them at a Trump rally and reports from Anaheim, California.
    Video

    Video Chinese-Americans Heart Trump, Bucking National Trend

    A new study conducted by three Asian-American organizations shows there are three times as many Democrats as there are Republicans among Asian-American voters, and they favor Hillary Clinton over Donald Trump. But one group, called Chinese-Americans For Trump, is going against the tide and strongly supports the business tycoon. VOA’s Elizabeth Lee caught up with them at a Trump rally and reports from Anaheim, California.
    Video

    Video Reactions to Trump's Success Polarized Abroad

    What seemed impossible less than a year ago is now almost a certainty. New York real estate mogul Donald Trump has won the number of delegates needed to secure the Republican presidential nomination. The prospect has sparked as much controversy abroad as it has in the United States. Zlatica Hoke has more.
    Video

    Video Drawings by Children in Hiroshima Show Hope and Peace

    On Friday, President Barack Obama will visit Hiroshima, Japan, the first American president to do so while in office. In August 1945, the United States dropped an atomic bomb on the city to force Japan's surrender in World War II. Although their city lay in ruins, some Hiroshima schoolchildren drew pictures of hope and peace. The former students and their drawings are now part of a documentary called “Pictures from a Hiroshima Schoolyard.” VOA's Deborah Block has the story.
    Video

    Video Vietnamese Rapper Performs for Obama

    A prominent young Vietnamese artist told President Obama said she faced roadblocks as a woman rapper, and asked the president about government support for the arts. He asked her to rap, and he even offered to provide a base beat for her. Watch what happened.
    Video

    Video Roots Run Deep for Tunisia's Dwindling Jewish Community

    This week, hundreds of Jewish pilgrims are defying terrorist threats to celebrate an ancient religious festival on the Tunisian island of Djerba. The festivities cast a spotlight on North Africa's once-vibrant Jewish population that has all but died out in recent decades. Despite rising threats of militant Islam and the country's battered economy, one of the Arab world's last Jewish communities is staying put and nurturing a new generation. VOA’s Lisa Bryant reports.
    Video

    Video Meet Your New Co-Worker: The Robot

    Increasing numbers of robots are joining the workforce, as companies scale back and more processes become automated. The latest robots are flexible and collaborative, built to work alongside humans as opposed to replacing them. VOA’s Tina Trinh looks at the next generation of automated employees helping out their human colleagues.
    Video

    Video Wheelchair Technology in Tune With Times

    Technologies for the disabled, including wheelchair technology, are advancing just as quickly as everything else in the digital age. Two new advances in wheelchairs offer improved control and a more comfortable fit. VOA's George Putic reports.
    Video

    Video Baby Boxes Offer Safe Haven for Unwanted Children

    No one knows exactly how many babies are abandoned worldwide each year. The statistic is a difficult one to determine because it is illegal in most places. Therefore unwanted babies are often hidden and left to die. But as Erika Celeste reports from Woodburn, Indiana, a new program hopes to make surrendering infants safer for everyone.
    Video

    Video California Celebration Showcases Local Wines, Balloons

    Communities in the U.S. often hold festivals to show what makes them special. In California, for example, farmers near Fresno celebrate their figs and those around Gilmore showcase their garlic. Mike O'Sullivan reports that the wine-producing region of Temecula offers local vintages in an annual festival where rides on hot-air balloons add to the excitement.
    Video

    Video US Elementary School Offers Living Science Lessons

    Zero is not a good score on a test at school. But Discovery Elementary is proud of its “net zero” rating. Net zero describes a building in which the amount of energy provided by on-site renewable sources equals the amount of energy the building uses. As Faiza Elmasry tells us, the innovative features in the building turn the school into a teaching tool, where kids can't help but learn about science and sustainability. Faith Lapidus narrates.

    Special Report

    Adrift The Invisible African Diaspora

    More Americas News

    Haiti Braces for Trouble as Election Panel Report Is Due

    Haitians are preparing for trouble as electoral verification commission is due to deliver results of its monthlong review of last year's contested presidential and legislative elections

    Brazil Launches Manhunt for Alleged Gang Rapists

    Police identifies four of 30 suspects who gang raped teenager and posted video online

    'El Chapo' Lawyers Split on Extradition Case

    Lawyers can't agree on staving off extradition to US

    Colombia Rebels Release Three Journalists

    All three, including a Spanish correspondent working on a story about coca growers, were released Friday

    WHO Dismisses Changing Summer Olympics for Zika

    WHO says canceling or postponing the Olympics will not alter the international spread of Zika virus

    Global Growth the 'Urgent Priority', G-7 Leaders Conclude

    A final statement of addressed broad issues facing the global economy while glossing over a difference of opinions among leaders over fiscal stimulus