By clothing-bag, 14/08/2022

Cuba needs anti -inflationary policies to mitigate inequities - IPS Cuba

Havana, Nov 4.- The Cuban government has among its multiple challenges the application of anti -inflationary policies that contribute to the reduction of social inequities, more visible after the economic rearrangement initiated in January.

“The salary of my husband and mine is almost completely in food, transport and pay the house accounts.We haven't bought clothes for a while, we just think about how to gather to dress and wear our two children, ”said Moraima Valle, a history of history resident in Havana.

Valle underlined IPS to win the equivalent of 170 dollars per month to the official change, but a couple of shoes exceed $ 200, "and the accounts do not even take a soda in the street".

The Havanera and Retired Miguelina Calvo, who served as a telephone operator, told IPS that the $ 72 of her pension is struck because “prices in the agromercado are through the clouds and some medicines I must buy them for the 'left market (informal market)', since there is almost never in the pharmacy ".

With the first day of the year, the so -called ordering task began to operate in this country, a comprehensive plan that included the elimination of the convertible peso equivalent to the dollar, the devaluation of the Cuban peso, the increase in wholesale and retail prices, suppression of a set of a setof subsidies, elevation of the services of the services, as well as the increase of wages and pensions.

Experts recognize their importance to make the accounting of companies more transparent and readcute the variables of the economy with international standards, but also indicate that it occurred with a delay of almost 10 years within the reform program initiated in 2011 to modernize the socioeconomic modelsocialist.

The monetary system occurred in the midst of a shortage of food, medicines and essential supplies due to the effects of COVID-19, and the impossibility of industries to increase production, due to the economic crisis in force for three decades.

After a five -year period with very low growth rhythms, this Caribbean island country lost 13 % of the gross domestic product (GDP) from the beginning of 2020 and until September 30, they reveal official data.

In the last two years the income was reduced by almost 3000 million dollars due to the fall of the main economic lines, while the priority to health shares to contain the pandemia reduced the amount available to import, in a country that only in food purchasesalmost 80 % of those consumed.

To the above is added the increase in US sanctions and the reinforcement of the embargo that since 1962 hinders financial operations and makes Cuba access to credits of international financial organizations impossible.

“The uncontrolled rise in prices generated distortions and dissatisfactions, especially in those who see their purchasing power;But at the same time it is a demotivation to work, since prices swallow salaries, ”economist Omar Everleny Pérez Villanueva told IPS.

According to the expert, the high inflation "has affected all social groups, but especially vulnerable people as older adults, who receive social security help, large families with many single children or mothers".

Hablan los números

On October 27 and 28, during the sessions of the National Assembly of Popular Power, the Unicameral Parliament Cuban, it transpired that the inflation rate exceeds 60 % during the first months of the year and tends to rise.

Cuban and Cubans live in their daily life prices seven to 10 times above the officers, acknowledged one of the reports exposed to the legislative body.

The monetary system raised the minimum wage to the equivalent of $ 87, and the maximum to almost 400.In the case of pensions, the lowest corresponds to $ 63.

The measure paid a fixed official rate of 24 pesos for each dollar, but in the informal market that figure ranges from 68 pesos for a metal dollar to 78 pesos for the one deposited in the bank for purchases with magnetic cards and that cannot be extracted.

Reports managed in Parliament estimate that the deficit in the offer is quantified at 2500 million dollars.It is a factor, they argue, that it triggered prices in the informal market and made the cost of the basic basket of goods and services grow, which now represents twice the 60 dollars initially projected for monthly expenses.

In addition, the reorganization did not eliminate the partial dollarization of the economy, after the opening since 2019 of stores for the sale of appliance equipment, food and essential items, through cards backed by accounts in convertible currencies.

Several government officials argue that the controversial mechanism allows you to collect currencies and with a part of them, provide some products to shops where most of the population whose salaries and income are only in Cuban pesos attend.

Such market segmentation expresses inequalities in income and consumption, because "all families do not access, nor can they buy the same amount of products in relation to their needs," Queen Fleitas sociologist told IPS.

On the one hand "there are those who live from their salaries, state or not, and on the other who have access to alternative revenues for remittances, private businesses or are part of the growing black market," Pérez Villanueva reasoned.

Analysts point out that in the face of chronic product shortage or the impossibility of buying in foreign exchange stores, a percentage of the population meets consumption needs in the submerged economy, partly fed by the theft of resources from state entities.

On inflation and its effects "we are aware of its gravity, and that is why the priority granted by the Government to its solution and the attention to vulnerable people," said President Miguel Díaz-Canel on October 28 before the National Assembly.

The government slightly modified some rates such as electricity, object of criticism due to its rise, while they have reiterated that they will not apply "shock therapies" and no one will be helpless in a nation with universal and free access to public education and health.

Likewise, the ration card has been maintained that since 1962, and without distinction of income, guarantees the 11.2 million inhabitants of the country a monthly fee of rice, sugar, grains, coffee, oil and animal protein that although it does not coverAll food needs is a relief for low -income households and vulnerable groups.

Inversión social y económica más equitativa

Political scientists underline that the protests that exploded on the island on July 11 obeyed, between different internal and external factors, for the effects derived from the high cost of living and the deepening of the economic crisis.

In the following weeks the government raised priority to social programs such as housing construction and repair, infrastructure and differentiated care works to people in vulnerability.

"There are government efforts that aim to try to improve the lives of families, and positive measures such as those that contribute to expanding economic actors and creating new sources of work, but the positive effects on consumption are not seen," Fleitas said.

In his opinion, "we must ensure that social and economic investment is more equitable in its distribution to stop internal migration" and recalled that in Havana, for example, many qualified vulnerable neighborhoods are founded by people who come from territories with territories withDisadvantages, especially from the Eastern Region.

For sociologist, "the same synergy between government and science to combat pandemia", should be achieved with social sciences, since "their results have not been valued as those of other disciplines ... and their publications are aimed not only to diagnose problems, but also to formulate proposals for politics ".

For Pérez Villanueva, "price control requires an increase in imports or the offer of national goods".

In recent months, the Government approved measures to boost business activity and since the end of September authorized the first micro, small or medium enterprises (MSMEs), which already exceed 300.

"But obstacles still persist in the decisions that business managers can make, while MSMEs must deal with state entities authorized to import, or acquire their inputs in the informal market, which impacts the costs," summarized the economist.

Ed: Eg