Monday, July 18, 2011

Cuba cuts bulk prices to support private workers

Cuba cuts bulk prices to support private workers
The Associated Press | July 18, 2011 | 01:12 PM EDT

Cuba is lowering bulk prices for goods ranging from marmalade and
mayonnaise to tools and CDs to support newly independent workers and
small businesses that lack a wholesale market, official news media said

The measure addresses a central complaint by many operators of private
restaurants, cafeterias and other operations authorized under a
wide-ranging economic overhaul launched last year by President Raul Castro.

Under an order from the Ministry of Finance and Pricing, a 1.3-gallon
(5-liter) container of cooking oil that used to sell for $11.50 can be
had for $9.80, labor newspaper Trabajadores reported. A 7-pound
(3-kilogram) container of tomato pure formerly worth $8.70 now goes for

"The measure also includes tools and pneumatic and electrical equipment,
all with the goal of enhancing sales to independent workers," the
article said.

Other products like tobacco, alcoholic beverages and bottled water are
not covered by the order. Trabajadores did not say when it took effect.

Although the initiative targets private businesses, the same prices will
apply for anyone making bulk purchases.

Cuba began allowing increased private enterprise at the end of 2010,
issuing licenses for people to launch small businesses and hire
employees independently of the state.

The government, which currently employs 80 percent of the labor force,
plans massive layoffs although those plans have been put on hold.

Many entrepreneurs have complained about a lack of access to a wholesale
market or to credit, as well as high tax rates. Cuba has said it plans
to extend loans, but details have not been released.

The government fixes prices, and while some products are heavily
subsidized and discounted, many other imported goods go for more than
double their value elsewhere.

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