Sunday, December 22, 2013

Raul Castro issues stern warning to entrepreneurs

Posted on Saturday, 12.21.13

Raul Castro issues stern warning to entrepreneurs

HAVANA -- President Raul Castro issued a stern warning to entrepreneurs
pushing the boundaries of Cuba's economic reform, telling parliament on
Saturday that "those pressuring us to move faster are moving us toward

Castro has legalized small-scale, private businesses in nearly 200
fields since 2010, but has issued tighter regulations on businesses seen
as going too far or competing excessively with state enterprises. In
recent months, the government has banned the resale of imported hardware
and clothing and cracked down on unlicensed private videogame and movie

Castro threw his full weight behind such measures in an address to the
biannual meeting of the communist legislature, saying "every step we
take must be accompanied by the establishment of a sense of order."

"Inadequate controls by government institutions in the face of illegal
activities by private businesspeople weren't resolved in a timely
fashion, creating an environment of impunity and stimulating the
accelerated growth of activities that were never authorized for certain
occupations," Castro said.

He told lawmakers that Cuba wants better relations with the U.S. but
will never give in to demands for changes to Cuba's government and
economy, saying "we don't demand that the U.S. change its political or
social system and we don't accept negotiations over ours."

"If we really want to move our bilateral relations forward, we'll have
to learn to respect our differences," Castro said. "If not, we're ready
to take another 55 years in the same situation."

Cuba blames a half-century-old U.S. embargo for strangling its economy
but Castro's government has also acknowledged that it must reform the
state-run economy with a gradual opening to private enterprise. Many
Cubans have enthusiastically seized opportunities to make more money
with their own businesses, but new entrepreneurs and outside experts
alike complain that the government has been sending mixed messages about
its openness to private enterprise.

The conflicting signals were apparent in Cuba's handling of the dozens
of private home cinemas and video game salons that sprung up around the
country this year, drawing crowds of young people willing to spend a few
dollars for access to the latest home entertainment technology imported,
purportedly for private use, by Cubans returning from the U.S., Canada
or other countries.

The government denounced the cinemas as spreading uncultured drivel to
the young, and ordered them closed last month for stretching the
boundaries on the kinds of private businesses allowed under reforms
instituted by Castro. Then came the backlash, with entrepreneurs
bemoaning thousands of dollars in lost investment and moviegoers saying
they were exasperated by heavy-handedness toward a harmless diversion.
The official reaction was swift, and unprecedented.

An article in the Communist Party newspaper Granma on last month
acknowledged there was wide disapproval of the ban, and hinted it was
being rethought. The same Granma article also offered a full-throated
defense of the ban on the reselling of imported hardware and clothes.

Castro appeared to justify all of the recent moves to clamp down on
private enterprise.

"We're not ignorant of the fact that those pressuring to move faster are
moving us toward failure, toward disunity, and are damaging the people's
confidence and support for the construction of socialism and the
independence and sovereignty of Cuba."

Several Cubans interviewed on the streets of Havana said they generally
approved of Castro's speech but wanted more details on economic reforms,
and a softer line toward the U.S.

"I would have liked to know exactly what pace of reform we're going to
follow," said Daniel Mora, a 72-year-old retired state worker. "And he
told the United States that we're ready for another 55 years of
blockade, but I'm not ready for that. I'm 72 and I'd like to see the
light at the end of the tunnel before I die."

Castro praised the Cold War ties between Cuba and South Africa's
anti-apartheid movement but did not mention his handshake with President
Barack Obama at Nelson Mandela's funeral this month.

He lamented that growth would come in at 2.7 percent for 2013, nearly a
full percentage below the predicted 3.6 percent. He said growth for 2014
was expected to be 2.2 percent.

It is nearly impossible to know on the true size of Cuba's economy
because Cuba uses two currencies, a convertible peso for tourists that's
pegged to the U.S. dollar and a Cuban peso worth about 4 cents, and the
government doesn't clearly distinguish between them in economic statistics.


Anne-Marie Garcia contributed to this report.


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