Saturday, October 26, 2013

Cuban economists in favor of merging currencies

Cuban economists in favor of merging currencies
Xinhua | 2013-10-25 11:17:46
By Agencies

Cuban economists on Thursday hailed the government's decision to phase
out the country's dual-currency system, calling it a key step towards
improving economic performance, local media reported.

Returning to a single currency makes the country's economic management
more efficient because of clearer register of costs, expenses and
pricing, said Danilo Guzman Dovao, the president of the National
Association of Economists and Accountants.

He said the dual-currency system had aided Cuba's economy during the
economic recession in the 1990s, but had eventually led to distortions
in the economy, its business sector and the lives of the Cuban citizens,
according to Juventud Rebelde, Cuba's Communist Youth daily.

Cuba witnessed an economic recession after the 1991 disintegration of
the Soviet Union, its major economic partner. Cuba has had two
currencies since 1994.

The two local currencies are the cheaper Cuban peso (CUP) and the
convertible peso (CUC). Most Cubans earn CUPs, while many local goods
are priced in CUCs.

Cuba announced Tuesday the move to scrap its dual-currency system as
part of the country's economic reforms.

"For ordinary citizens, having a single currency circulating in the
country would be a relief, doing away with the often tortuous process of
purchasing many of their staple items, only available in CUCs," said
Guzman Dovao.

Joaquin Infante, an award-winning economist, said the decision marked
the beginning of an urgently-needed process to modernize Cuba's economy
as effectively as possible.

"The process will begin with (state) companies, and then, according to
the increase in productivity and production, it will spread to the
private sector and the general public," he said.

Infante said the currency unification will more objectivly measure the
country's macroeconomic indicators, such as the gross domestic product
(GDP), the national income and the balance of payments.

Source: "Cuban economists in favor of merging currencies - WORLD -" -

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