Caveats to Cuba’s Communist Party’s Decision To Legalize Small and Medium-Sized Businesses 

Based upon secondary sources, a prior post asserted that the Communist Party of Cuba at its recent Seventh Congress had decided to have small and medium-sized businesses legalized. Now, another secondary source suggests that there are significant qualifications to that Party decision.[1]

First, this new source says “the legalization of the so-called PYMES (Spanish acronym for small and medium enterprises) is part of a . . . Party . . . project to ‘conceptualize’ the ‘theoretical basis … for the economic and social model that we aspire to as part of the process of actualizing’ the island’s system.” This project is “part of another document on a ‘Projected National Economic and Social Development Plan until 2030’ … whose fulfillment will contribute to reaching that model, in the long run.’” (Emphasis added.)

The “strategic sectors singled out for development in the 2030 Plan” include “construction, electricity, telecommunications, internet connectivity, transportation and warehousing for commercial activities, hydraulic installations and networks; tourism and related activities such as marinas, golf and real estate; professional services, especially medical personnel; non-sugar agriculture and the food industry; production of pharmaceuticals and biotechnology; the sugar industry and light industry for the domestic market.”

The Party documents also note that “’in the future society to which we aspire’ the socialist economy and central planning will occupy ‘a primordial place’” and that “the ‘existence of non-state forms (of economic activity) will depend on the goals of socialist development.’” In addition, the government will “recognize private property that fulfills a public function in specific activities and whose owners are people or companies — Cuban as well as foreign.” Moreover, “Cubans will be able to establish ‘small businesses carried on basically by the worker and his family’” as well as “’private companies of medium, small and micro sizes, according to the volume of the activity and the number of workers, (to be) legally recognized as companies.’”

As a result, this secondary source predicts a slow pace in adopting these reforms.

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[1] Torres, Cuba’s Communist Party lays out a vague future for private enterprise, InCuba Today (May 31, 2016).

Cuba To Legalize Small and Medium-Sized Private Businesses

On May 24, the Communist Party of Cuba announced that its Seventh Congress this past April had decided that the Party supports legalization of small and medium-sized private businesses, a move that could significantly expand the space allowed for private enterprise.[1]

The Party’s report said categories of small, mid-sized and “micro” private business are being added to its master plan for social and economic development. These categories of business will be recognized as legal entities separate from their owners, implying a degree of protection that hasn’t so far existed for self-employed workers.

The Party justified this decision by saying, “Private property in certain means of production contributes to employment, economic efficiency and well-being, in a context in which socialist property relationships predominate.”

Until now, the government has allowed private enterprise only by self-employed workers in several hundred established categories like restaurant owner or hairdresser. Many of those workers have become de-facto small business owners employing other Cubans. But there are widespread complaints about the difficulties of running a business in a system that does not officially recognize them. Low-level officials often engage in crackdowns on successful businesses for supposed violations of the arcane rules on self-employment.

Cuban business owners and economic experts said they were hopeful the reform would allow private firms to import wholesale supplies and export products to other countries for the first time, removing a major obstacle to private business growth. Most of these de facto businesses currently are forced to buy scarce supplies from state retail stores or on the black market, increasing the scarcity of basic goods and driving up prices for ordinary Cubans. Many entrepreneurs pay networks of “mules” to import goods in checked airline baggage, adding huge costs and delays.

“This is a tremendously important step,” said Alfonso Valentin Larrea Barroso, director-general of Scenius, a cooperatively run economic consulting firm in Havana. “They’re creating, legally speaking, the non-state sector of the economy. They’re making that sector official.”

Similar reactions came from people in the U.S.

“It is about time,” said Emilio Morales, a former senior official in a Cuban government commercial conglomerate who is now president of the Havana Consulting Group in Miami. “They are realizing that the economy is not going to move without this.” Cuban leaders “have seen that all their [international] allies they had are disappearing.”

Richard Feinberg, an economist at the University of California San Diego., said these changes should enable private companies to open bank accounts, do business with state-owned enterprises and engage in international trade. The move should give entrepreneurs “all sorts of rights and capabilities that are critical to running a business.”

These changes will require new legislation by the country’s National Assembly, which is expected to hold one of its biannual meetings by August.

The Party’s report was the first comprehensive public accounting of the Congress, which was closed to the public and international press. It was made publicly available for sale in Cuba in a special tabloid with an announcement that the report will be “democratically debated by the militancy of the Party and the Young Communist League, and representatives of mass organizations and large sectors of society in order to enrich and perfect the report.” The full report has not yet been found on the Internet.[2]

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[1] Weissenstein, Cuba to legalize small and medium-sized private business, InCuba Today (May 24, 2016); Assoc. Press, Cuba to Legalize Small and Medium-Sized Private Businesses, N.Y. Times (May 24, 2016); Althaus, Cuba Moves to Legalize Small-and Medium-Size Businesses, W.S.J. (May 24, 2016); de Llano, Cuba announces that legalize SMEs, El País (May 24, 2016).

[2] For sale tabloid containing special projects on the Conceptualization of Social and Economic Model and the foundations of the National Development Plan, Granma (May 23, 2016).

United States-Cuba Bilateral Commission Meets To Review Normalization Status                                                                                                

On May 16, in Havana the U.S.-Cuba Bilateral Commission held its third meeting to review the status of the countries’ efforts to normalize relations. The U.S. delegation was headed by Ambassador Kristie Kenney, currently serving as Counselor of the Department of State, who was assisted by John S. Creamer, Deputy Assistant Secretary of State, Bureau of Western Hemisphere Affairs, U.S. Department of State; and by U.S. Ambassador Jeffrey DeLaurentis, Chargé d’Affaires, U.S. Embassy, Havana, Cuba. The Cuban delegation’s head was Josefina Vidal Ferreiro, the Director General of the Cuban Ministry of Foreign Affairs’ Department of the United States.[1]

Before the meeting the U.S. State Department said it “will provide an opportunity to review progress on a number of shared priorities since the last Bilateral Commission meeting in November 2015, including progress made during the President’s historic trip to Cuba in March. The United States and Cuba expect to plan continued engagements on environmental protection, agriculture, law enforcement, health, migration, civil aviation, direct mail, maritime and port security, educational and cultural exchanges, telecommunications, trafficking in persons, regulatory issues, human rights, and claims for the remainder of 2016.”

Director General Vidal’s Press Conference

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At a press conference after the meeting, Director General Vidal said the meeting had been “productive” and conducted in a “professional climate of mutual respect.” (A photograph of Vidal at the press conference is on the left.) The parties agreed to hold the fourth meeting of the Bilateral Commission in September 2016 in Washington, D.C.

Vidal also said she had told the U.S. delegation that Cuba reiterates its “appreciation for the positive results from President Obama’s visit to Cuba” that had been mentioned by President Raúl Castro during Obama’s visit. Indeed, she said, Cuba believes this visit is “a further step in the process towards improving relations” between the two countries and “can serve as an impetus to further advance this process.”[2]

Vidal acknowledged that there has been an increase in official visits as well as technical meetings on topics of common interest resulting in nine bilateral agreements to expand beneficial cooperation.[3]

According to Vidal, both delegations agreed on steps that will improve relations, including conducting high-level visits and technical exchanges on environmental, hydrography, and implementation and enforcement of the law, including fighting trafficking in drugs and people, and immigration fraud. The two countries also are getting ready to conclude new agreements to cooperate in areas such as health, agriculture, meteorology, seismology, terrestrial protected areas, response to oil-spill pollution, fighting drug trafficking and search and rescue, among others. They also are ready to start a dialogue on intellectual property and continue those relating to climate change and regulations in force in the two countries in the economic and trade area.

However, Vidal said, progress has not been as fast in the economic area because “the blockade [embargo] remains in force” despite the positive measures taken by President Obama to loosen U.S. restrictions. There still are significant U.S. restrictions on U.S. exports to Cuba and imports from Cuba. In addition, U.S. investments in Cuba are not allowed except in telecommunications, and there are no normal banking relations between the two countries. Therefore, Cuba stressed again the priority of the “lifting the economic, commercial and financial blockade [embargo].”

More specifically Vidal said Cuba had told the U.S. representative that in the last six months two American companies and one French company had been fined by the U.S. for maintaining links with Cuba while Cuba has had problems with 13 international banks’ closing accounts, denying money transfers or suspending all operations with Cuba. In addition, six service providers have ceased providing services to Cuban embassies and consulates in third countries (Turkey, Austria, Namibia and Canada).

In addition, the Cuban delegation, said Vidal, had reaffirmed the need for the U.S. to return to Cuba the territory [allegedly] illegally occupied by the U.S. naval base in Guantanamo. It “is the only case of a military base in the world that is based in a territory leased in perpetuity, which is an anomaly from the point of view of international law.[4] There is no similar example in the world and is the only instance of a military base in a foreign country against the will of the government and people of that country.

Vidal also mentioned the following U.S. policies and actions that needed to be changed:

  • the U.S. preferential migration policies for Cuban citizens, expressed in the existence of the policy of dry feet/wet feet;
  • the U.S. Cuban Adjustment Act regarding those immigration policies;
  • the U.S. program of parole for Cuban health professionals;
  • the special U.S. radio and television broadcasts designed especially for Cuba (Radio and TV Marti); and
  • U.S. programs designed to bring about changes in the economic, political and social system of Cuba.[5]

These U.S. policies, according to Vidal, underscored “a huge contradiction” for the U.S. On the one hand, President Obama said in his speech in Cuba that the U.S. has neither the intention nor the ability to bring about change in Cuba and that in any case it was up to the people of Cuba to make their own decisions. On the other hand, the U.S. has programs with huge budgets ($20 million dollars every year) aimed at bringing about such change. If indeed there is neither the intention nor the ability to bring about change in Cuba, then there is no reason to have such programs.

Normalization, said Vidal, also needs to have protection of rights to trademarks and patents because there are Cuban companies owning well-known marks, which for reasons of the blockade and other reasons have been taken away from the Cubans.

Before the meeting, another Cuban Foreign Ministry official said that the parties previously had discussed, but not negotiated, with respect to Cuba’s claim for damages with respect to the U.S. embargo and the U.S. claims for compensation for property expropriated by the Cuban government. At the meeting itself, according to a Cuban statement, the Cubans had delivered a list of its most recent alleged damages from the blockade (embargo).

U.S. Embassy Statement

The U.S. Embassy in Havana after this Bilateral Commission meeting issued a shorter, but similar, statement about the “respectful and productive” discussions. “Both governments recognized significant steps made toward greater cooperation in environmental protection, civil aviation, direct mail, maritime and port security, health, agriculture, educational and cultural exchanges, and regulatory issues. The parties also discussed dialogues on human rights and claims, and the [U.S.] looks forward to holding these meetings in the near future.”

Conclusion

Since the actual meeting was conducted in secret, it is difficult to assess what was actually accomplished except through officials’ subsequent public comments.

On May 17, the two countries conducted their second Law Enforcement Dialogue, which will be discussed in a subsequent post.

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[1] U.S. Department of State, United States and Cuba to Hold Third Bilateral Commission Meeting in Havana, Cuba (May 12, 2016); Gomez, MINREX: relations between Cuba and the United States would advance more nonblocking, Granma (May 12, 2016); Reuters, Cuba and U.S. Officials to Meet Next Week to Deepen Detente, N.Y. Times (May 12, 2016); Francisco & Elizalde, Cuba-US Bilateral commission: a productive meeting, Josefina Vidal  (+ Photos and Video), CubaDebate (May 16, 2016); Assoc. Press, Top Cuba Diplomat: Obama Trip Positive, Created Momentum, N.Y. Times (May 16, 2016); Reuters, Cuba and United States Draw Up Roadmap for Talks to Deepen Détente, N.Y. Times (May 16, 2016); Gomez, Cuba and the United States defines ambitious agenda for the coming months, Granma (May 16, 2016); U.S. Embassy, Havana, Cuba, Third Bilateral Commission Meeting in Havana (May 16, 2016); Press release issued by the Cuban delegation to the Third Meeting of the Cuba-U.S. Bilateral Commission, Granma (May 17, 2016); Cuba and U.S. set ambitious agenda for coming months, CubaDebate (May 17, 2016).

[2] Vidal’s positive comment about Obama’s visit is in sharp contrast to the negative comments about the visit from Vidal’s superior, Foreign Minister Bruno Rodriguez at the recent Congress of the Communist Party of Cuba. (See Conclusion of Seventh Congress of Communist Party of Cuba, dwkcommentaries.com (April 20, 2016).)

[3] Beforehand an official of Cuba’s Foreign Ministry said that since the December 2014 announcement of détente the parties had signed nine agreements covering the environment, email, navigation safety, agriculture and travel. In addition, the Telecommunications Company of Cuba (ETECSA) had signed agreements with three U.S. companies for cellular roaming in Cuba; a U.S. company (Starwood) had an agreement to manage several Cuban hotels; and the Carnival cruise lines had made a maiden voyage to the island.

[4] The U.S., however, contends that the lease is not in perpetuity, but for so long as the U.S. uses it as a “naval station.” This is one of the potential issues to be resolved in an international arbitration as suggested in a previous post. (Does Cuba Have a Right To Terminate the U.S. Lease of Guantanamo Bay? dwkcommentaries.com (April 26, 2015).)

[5] Prior posts have concurred in the Cuban requests for ending all of these U.S. programs and policies. See Topical List of Posts—Cuba.

Prominent Latin American Journalist’s Critical Observations About Cuba

imagesAlma Gillermoprieto, a prominent journalist who has written extensively about Cuba and Latin America,[1] in an article dated April 15, 2016,[2] had interesting observations about Cuba, which subsequently have been confirmed by the Seventh Congress of the Communist Party of Cuba and other events. (Her photograph is to the right.)

She was in Cuba during President Obama’s visit and did not disagree with the U.S. media’s declaring “Obama the winner in the encounter” with Raúl Castro, an unsurprising conclusion since “Obama is as skilled at public relations as any U.S. politician, and the leader of a monolithic state hardly needs charm.” Obama and his speech to the Cuban people on live television, as discussed in an earlier post, made a significant impact on the Cuban people with the speech’s content as well as his persona—young, vigorous, handsome and African-American.

The Broken Cuban Economic System

Guillermoprieto noted that everyone in Cuba obviously was aware of the state of disrepair of nearly everything on the island. It prompted the “joke on everyone’s lips,” she reports, “that Obama should stay in Havana for a month, because in preparation for his three-day visit [in March] more had been done to fix up the place than in the previous half-century.” This was but one indication of the broken Cuban economic system.

For Raúl Castro and the other leaders of the Government and the Communist Party of Cuba, Guillermoprieto speculates, the question has been “How many mistakes can safely be corrected? When the house you live in is falling apart, how much can you tinker with the plumbing, the windows, the doorjambs, and the supporting walls before the whole edifice collapses around you?”

Raúl in his April 21 speech to the Party Congress admitted some of the major ways in which the Cuban economic house was falling apart. Economic growth [over the past five years], he said, was “not enough to ensure the creation of the productive and infrastructure conditions required to advance development and improve the population’s consumption.” Indeed, “wages and pensions are still unable to satisfy the basic needs of Cuban families.” (Emphasis added.)

A major problem, Castro admitted at the Congress, was insufficient agricultural production and hence rising prices for basic foodstuffs and the need to maintain consumer subsidies in the form of lower prices with ration books. Such price controls to lower prices on basic foods were instituted on April 22, and on May 3 additional price controls on foodstuffs were implemented.[3]

Moreover, said Castro, “The state enterprise system, which constitutes the main management mode in the national economy, finds itself in at a disadvantage when compared to the growing non-state sector which benefits from working in monetary system with an exchange rate of one CUC to 25 CUP, while the state system operates on a basis of one CUC to one CUP. This serious distortion must be resolved as soon as possible and a single currency reestablished.” (Emphasis added.)

According to Castro, efforts to implement the economic reforms approved five years ago have been delayed due to “slow implementation of legal regulations and their assimilation.” The “main obstacle,” however, has been “out-dated mentalities, which give rise to an attitude of inertia or lack of confidence in the future. There also remain, as was to be expected, feelings of nostalgia for the less difficult times in the revolutionary process, when the Soviet Union and socialist camp existed.”(Emphasis added.)

Incorporating Private Enterprise in the Cuban System

Guillermoprieto further speculates that Raúl “may be trying to modernize Cuban socialism to the point where it is capitalist and open enough to accommodate the restless generations who are now under forty-five years of age . . . . Perhaps he has the sense that the revolution is finished, that there is no future in the old dogmas and failures, that sixty years of poverty and repression are enough, and that he has no real power to control the inevitable future. Perhaps he is simply trying to ensure, finger in the dike, that a newly capitalist Cuba does not slide into a morass of corruption and cynicism.”

At the subsequent Party Congress, Raúl clearly embraced private enterprise as necessary and welcome to Cuba. He said, “Cooperatives, self-employment and medium, small and micro private enterprise are not in their essence anti-socialist or counter-revolutionary.” With non-state employment increasing from 18.8% in 2010 to 29.2% of the economy in 2015, “just over half a million Cubans [now] are registered as self-employed; they provide services and generate much-needed production. An atmosphere that does not discriminate against or stigmatize duly authorized self-employment is being defined. . . . [We] favor the success of non-state forms of management.” (Emphasis added.)

Moreover, according to Raúl, “Recognizing the market in the functioning of the our socialist economy does not mean that the Party, government and mass organizations are no longer fulfilling their role in society. . . .The introduction of the rules of supply and demand is not at odds with the principle of planning. Both concepts can coexist and complement each other for the benefit of the country.” (Emphasis added.)

At the same time, Raúl made it clear that these welcome changes did not constitute an abandonment of the ideals of the Revolution, that state ownership of the means of production would still be the mainstay of the economy, that the changes did not constitute a restoration of capitalism, that the state would not permit concentrations of wealth and property and that Cuba needed to be wary of powerful external forces (i.e., the U.S.) seeking to take advantage of these changes.

Other signs of Cuba’s economic distress are the recent firing of an economist at the university of Havana and the upsurge of Cubans, especially younger people, leaving the island, as mentioned in a prior post.

Internal Cuban Opposition to Economic Reforms

Guillermoprieto notes that Raúl has internal opposition to rapid and significant changes to the economy and government, including brother Fidel in his rambling article in Granma after Obama’s visit that was discussed in a prior post. That article has opened the gates for other opposition, cleverly directed at Obama instead of Raúl.

Indeed, at the subsequent Party Congress, Foreign Secretary Bruno Rodriguez and one of the Cuban Five delivered speeches with harsh criticism of President Obama as the “pied piper’ attempting to lure Cubans down the path of capitalism. This too was discussed in an earlier post.

Guillermoprieto also quotes respected Cuban historian Rafael Rojas, now based in Mexico, about other opposition to Raúl coming from government ministries who believe “change must come more quickly.” A key problem for such rapid change that was recognized in Raúl’s recent report to the Party Congress was the need to eliminate as soon as possible the dual currency system (the CUC and the CUP), but the state’s subsidization of many prices in CUC makes that exceedingly difficult financially.

Inequality in Cuba

Guillermoprieto notes that there already is income and wealth inequality in Cuba growing out of its allowance of self-employment, i.e., private enterprise, in certain occupations over the last five years and the allowance of higher salaries or wages for medical doctors (now $67 per month) versus those employed in state-enterprises ($25 per month). The prospect is that there will be more inequality contrary to the ideals of the Revolution.

The recent allowance of higher salaries for Cuban physicians apparently was justified on the theory of a pyramid of workers with those with higher skills like doctors at the top of the pyramid earning higher salaries. Indeed, in Raúl’s speech to the Party Congress he complained about the inversion of the pyramid where lower-skilled workers like hotel bus boys and gas pump operators earn more through tips In hard currencies and illegal sales of gasoline than highly-skilled workers like physicians. This lamentable situation, said Castro, “does not allow work to be compensated in a fair manner, in accordance with its quantity, quality and complexity, or living standards to reflect citizens’ legal income.” This situation also generates “an unmotivated workforce and cadres, which also discourages employees from seeking out positions of greater responsibility.”

Guillermoprieto also reports that physicians who go on Cuba’s famous foreign medical missions are paid $500 per month ($300 while in the foreign country plus $200 deposited in a Cuban bank to encourage their return to the island). Because this is less than the Cuban government is paid for their services, she apparently regards this as unfair. I, however, draw the opposite conclusion while assuming her numbers are correct. The $500 per month is over seven times higher than the physician’s salary in Cuba and clearly is economically attractive to the physician. It totally negates the U.S. State Department contention that the Cuban doctors on foreign missions are engaged in illegal forced labor as discussed in a prior post.[4]

Conclusion

I am grateful for Guillermoprieto’s sharing her observations about Cuba. She provides additional evidence of the brokenness of the Cuban economic system and the difficulties of reforming or restructuring that system to include the advantages of free enterprise while simultaneously controlling its disadvantages.

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[1] Alma Guillermoprieto, Wikipedia. In her memoir, Dancing with Cuba: A Memoir of the Revolution, she recounts moving in 1970 from New York City to Havana to teach at Cuba’s National School of Dance. For six months, she worked in mirrorless studios (it was considered more revolutionary); her poorly trained but ardent students worked without them but dreamt of greatness. Yet in the midst of chronic shortages and revolutionary upheaval, Guillermoprieto found in Cuba a people whose sense of purpose touched her forever.

[2] Guillermoprieto, Cuba: The Big Change, N.Y. Rev. Books (May 12, 2016).

[3] New measures announced to regulate prices of agricultural produce, Granma (May 3, 2016)  Such price controls, however, are seen by most economists as misguided ways to cope with supply and demand issues.

[4] That earlier post pointed to a study by Indiana State University’s Emeritus Professor of International Politics and Latin America, Dr. H. Michael Erisman, who said, “most evidence indicates that the overwhelming majority [of Cuban doctors on foreign missions] are motivated by philosophical and/or pragmatic considerations. In the first instance, one needs to understand that the Cuban medical profession . . . is permeated by norms which stress self-sacrifice and service to the community, both at home and abroad. At the core of this ethos is the principle, which is firmly entrenched in the curriculum of the island’s medical schools and reinforced throughout one’s career, that health care should not be seen as a business driven by a profit motive, but rather as a human right that medical personnel have an unconditional duty to protect. Such convictions often underlie participation in the medical aid brigades. There are, however, also some pragmatic factors that can come into play. Overseas service could . . . help to further one’s professional aspirations and for some assignments the total remuneration involved is more generous than what is available back in Cuba. . . . [T]hese are the considerations which apply to the vast majority of people” in such programs, not involuntary servitude. Also relevant is the fact that Cuban medical education is free and in a quid-pro-quo the student agrees to serve in such missions upon becoming a doctor.

 

 

 

 

Another Cuban Migrant Problem in Central America 

Last November 8,000 Cuban migrants were stranded in Costa Rica on their journey to the U.S. after Nicaragua closed its borders with Costa Rica. This crisis eventually was resolved by a multilateral effort in that region to transport the migrants by plane and bus to the Mexico-U.S. border where they gained entry to the U.S. The last of such transfers occurred this March. Another part of the “solution” was Costa Rica’s closing its southern border to additional Cuban migrants coming from neighboring Panama.[1]

It recently has been revealed that the U.S. in January, pledged at least $1 million to help provide temporary shelter, potable water, food, sanitation and hygiene kits to the thousands of Cubans who had been stranded in Costa Rica while trying to make their way to the American border. The U.S. did so through the International Organization for Migration. The State Department said, “We expect this particular contribution to be a one-time contribution, and the final amount that will actually be provided to I.O.M. will depend upon needs on the ground, given that the number of vulnerable migrants in need of immediate humanitarian aid in Costa Rica fluctuates.”[2]

Now another similar crisis has erupted with over 3,500 Cuban migrants stranded in Panama and unable to enter Costa Rica. On April 13 an estimated 1,200 of the Cubans illegally entered Costa Rica after attacking one of its immigration offices at the border.

Costa Rica’s Response[3]

In its initial response, on April 11, Costa Rica’s Foreign Minister, Manuel González Sanz, issued a warning to the new wave of undocumented Cubans hoping to travel by land from Ecuador to the U.S. He said, “I want to make absolutely clear, to all the [Cuban] migrants who are coming and those already in Panama, that Costa Rica cannot and will not receive them.”

Moreover, The Foreign Minister stated Costa Rica ““will make use of all domestic and international measures at its disposal to address this situation, if we face something similar to what we faced from November to March.” His country, the Foreign Minister added, “already gave everything it could give, did more than it was required to do, and we definitely are not in a position to confront—not as part of a group and certainly not alone, as we did in the past—a situation similar to what the country experienced.”

González’s statement appropriately blamed U.S. laws, especially the Cuban Adjustment Act, granting special immigration benefits to Cubans arriving by land at the U.S. border. Therefore, the issue of Cuban migration “should be part of the bilateral relations between Cuba and the United States, but the reality is that the countries from Ecuador to Mexico, we are the ones caught in the middle and we are the ones suffering the consequences of laws that incite that migration.”

The next day, April 12, Costa Rica hosted a regional meeting to discuss this new migrant crisis. Other countries present were Ecuador, Colombia, Panama, El Salvador, Guatemala, Honduras, Mexico and the U.S. Absent were Nicaragua and Cuba. Costa Rica’s Foreign Minister said, ““We are once again faced with a valuable opportunity to continue the dialogue, take advantage of good practices and experiences, reaffirm our commitments and, as in the meetings that preceded this, demonstrate that we can provide permanent concrete solutions,” He added, “ If there is not a coordinated, structural approach by all the countries involved, we will continue to have these events affecting countries individually. But individual action has proven to be too fragile for one country to take on a problem of such magnitude.”

After the April 13 illegal entry of Cuban migrants, the Costa Rican government issued another statement. It said the government:

  • “Reaffirms its commitment to respect for human rights and the protection of the dignity of persons irrespective of their nationality. The Government is obliged to maintain, in compliance with the law a climate of social peace for its citizens, to events that put their safety at risk.”
  • “Remembers that Costa Rica was an example to the world with humanitarian assistance of Cuban migrants, with the help of communities, civil society, municipalities and public institutions to more than 8,000 people who were stranded in our territory attended between November 2015 and March 2016.”
  • “Remembers that since December 18, 2015, Costa Rica ceased granting extraordinary transit visas to Cuban migrants, who were notified, transparently and straightforwardly, they cannot enter the country illegally.”
  • “Reports the various U.S. regulations that promote and privilege for entry into that country, incite illegal Cuban migration and create perverse incentives to migration and favorable conditions for trafficking in human beings.”
  • “Deplores that Costa Rica and Panama are trapped in a region that maintains closed northern borders and open southern borders.”
  • “Reports that today more than a thousand irregular migrants entered Costa Rica violently in an affront to the Costa Rican people, who attended in past months so timely and generously to Cuban migrants.”
  • “Declares that Costa Rica has no economic or logistical capacity to host new groups of migrants. The Costa Rican people have given more than our ability is to sustain these groups of people.”
  • “Announced that efforts are made with the government of Panama to return all migrants irregularly entering our territory.”
  • “Repudiates and rejects all acts of violence and anyone who enters that way will be stopped.”
  • “Reports that Costa Rica had an active participation in the meeting held yesterday in San Jose, Costa Rica with chancellors, vice chancellors, members of government, immigration authorities and officials from UNHCR, UNDP, IOM. This meeting did not produce the expected results.” (Emphasis added.)

In addition, the President of Costa Rica, Luis Guillermo Solis Rivera, issued an order to implement this statement. In addition, the President stated that his government will write to President Obama to express his country’s “repudiation of . . . the effect of U.S. legislation which encourages [Cuban] migrants to continue a dangerous transit to that country using our territories.”

On April 15, the Government of Costa Rica issued another statement about the situation. This statement reiterated the previous points and declared that “Costa Rica and Panama are working to find joint and sustainable international solutions” to this problem.

Panama’s Response

On April 15, the Panama Foreign Ministry expressed “its concern about the current crisis of Cuban migrants in Latin America and their interest and willingness to find a sustainable and joint solution with the countries of the region.” It called on “the migrants living in our country to respect the peace and rules of both countries, especially in such a difficult situation.” At the same time, Panama has made significant efforts to safeguard the human rights of the migrants and has obtained Mexico’s agreement for nearly 1,300 Cuban migrants to fly from Panama to Mexico so they can continue their transit to the U.S. [4]

Cuba’s Response

Although invited to the Costa Rica meeting about the problem, Cuba did not attend, and no official Cuban statement on the matter has been found.

However, Raúl Castro as First Secretary of the Communist Party of Cuba on April 16 delivered the Central Report to the Party’s Seventh Congress. He said that U.S. migration policies that encourage Cubans to defect were “a weapon against the revolution.”[5]

 U.S. Response

 To my amazement and regret, I have not found any response to this situation from the U.S. Government.

However, prior posts have argued that the U.S. should terminate its ”dry feet” policy that allows Cubans automatic entry into the country without a visa when arriving by land as well as the U.S. Cuban Medical Personnel Parole Policy that grants such personnel parole into the U.S. These policies are based upon the obsolete U.S. notion that every Cuban leaving the island is escaping persecution.[6]

These recent problems in Central America provide another reason for the U.S. to terminate these programs. Our friends in Central and South America are being subjected to intolerable burdens from Cuban migrants and our friends also see what they regard as unfair harsh U.S. immigration policies for their people seeking to go to the U.S. when compared with the Cubans.

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[1] This earlier crisis was discussed in these blog posts: Cubans in Central America Provide Cuba with an Opportunity To Reiterate Its Objections to U.S. Immigration Policies (Nov. 20, 2015); Update on Cuban Migrants in Central America (Nov. 27, 2015); Status of Cuban Migrants in Central America Still Unresolved (Dec. 11, 2015); Resolution of Problem of Cuban Migrants Stranded in Central America (Dec. 30, 2015).

[2] Robles, U.S. Pays to Feed and Shelter Cuban Migrants Stranded in Costa Rica, N.Y. Times (Mar. 4, 2016;

[3] Meléndez, Costa Rica says its doors are closed to Cubans, Miami Herald (April 11, 2016); Costa Rica Foreign Ministry, Deputy Foreign Ministers Meeting in Costa Rica allowed constructive dialogue on the issue of migration flows (April 12, 2016); San Martin, Central American countries meet to resolve new Cuban migration wave, Miami Herald (April 12, 2106); Costa Rica Foreign Ministry, Declaration by the Government of Costa Rica to irregular entry of migrants (April 13, 2016); Assoc. Press, Migrants Force Way Into Costa Rica From Panama, N.Y. Times (April 13, 2016); Dyer, Costa Rica pushed greater regional cooperation on Cuba, African migration, Tico Times (April 13, 2016); Fernandez, Cuban migrants force their way across the Panama-Costa Rica border,Miami Herald (April 14, 2016); Costa Rica Foreign Ministry, Statement of the Government of Costa Rica to the attempt of massive influx of Cuban migrants (April 15, 2016).

[4] Panama Foreign Ministry, Panama reiterates concern over problems of Cuban migrants (April 15, 2016).

[5] Reuters, Castro Hardens Rhetoric, Warns Cubans to Be Alert to U.S. Intentions, N.Y. Times (April 16, 2016).

[6] Prior posts about special U.S. immigration laws for Cubans: New York Times Calls for End of U.S. Program for Special Immigration Relief for Cuba Medical Personnel (Nov. 23, 2014); U.S. and Cuba Fail To Resolve Complaints About U.S. Immigration Policies (Dec. 1, 2015); President Obama Should Exercise His Legal Authority To End U.S. Admission of Cubans Arriving with “Dry Feet” (Dec. 4, 2015); New York Times Calls for End to Special U.S. Immigration Programs for Cubans (Dec. 21, 2015); U.S. Ending Its Cuban Medical Personnel Parole Program? (Jan. 8, 2016).

 

Cuban Communist Party Holding Its Seventh Congress

CongressOn April 16-19 the Communist Party of Cuba will hold its Seventh Congress to set the country’s economic path through 2030.[1]

Granma, the Party’s official newspaper, reported that he Congress will work in four commissions or committees on the following topics: (1) “the conceptualization of Cuba’s socio-economic model;” (2) “the development plan . . . for the nation’s vision, priorities and strategic sectors” through 2030; (3) “the implementation of the Guidelines approved by the 6th Congress [in 2011] and their updating for the next five years;” and (4) analysis of “progress made toward meeting the objectives agreed upon by the First Party Conference [in 1975].”

The Guidelines approved at the last Congress included legalizing home and car sales, encouraging the development of mid-size cooperatives with dozens of employees and eliminating exit permits for Cubans to travel outside the country.

There will be 1,000 delegates, including “Party cadres, deputies to the National Assembly, representatives from Central State Administration bodies, our civil society, combatants, researchers from scientific centers, university professors, intellectuals, and press editors.” Women constitute 43% of the delegates, while 36% are Black or of mixed race. In addition, there will be 280 invitees, including 14 “members of Party units in our international solidarity missions, from five countries: Venezuela, Brazil, Haiti, Bolivia and Ecuador.”

In anticipation of the Congress, some “party members [have been] complaining about a lack of the advance debate on economic and social reforms seen in the past.” In response, Granma published a lengthy article admitting it had received “expressions of concern from Party members (and non-members, as well) inquiring about the reasons for which, on this occasion, plans were not made for a popular discussion process, similar to that held five years ago regarding the proposed Economic and Social Policy Guidelines of the Party and Revolution.”

Such expressions of concern said Granma, were seen as “a demonstration of the democracy and participation which are intrinsic characteristics of the socialism we are building.” Nevertheless, after reviewing the elaborate processes leading up to the decisions of the prior Congress and the difficulties in implementing all of its resolutions, Granma said that “rather than launching another process of discussion on a national level, half way along the road, what is more appropriate is finishing what has begun – continuing to carry out the people’s will expressed five years ago, and continuing to advance in the direction charted by the 6th Congress.”

This Granma article also stated that the forthcoming Congress would be evaluating six documents: (1) evaluation of the national economy’s performance during the five year period, 2011-2015; (2) progress in the implementation of guidelines [set in 2011]; (3) an updating of these guidelines for 2016-2021: (4) the conceptualization of Cuba’s socio-economic model of socialist development; (5) the Economic Development Program through 2030; and (6) the implementation status of the First National Conference’s objectives approved in January of 2012. As a result, according to Granma, the Seventh Congress “will give continuity to the previous Congress and the First National Party Conference [in 1975], and provide a much more precise definition of the path to be taken by our country – sovereign and truly independent since the triumph of the Revolution, January 1, 1959 – in order to build a prosperous and sustainable socialism.”

U.S. observers thought Party officials have been “particularly secretive” about this meeting and wondering whether the party signals it wants faster steps toward a more free-market system—such as allowing Cubans to operate more types of businesses—or if it keeps the current pace or even slows things down.” So far, however, “the only article in the official Granma newspaper to deal substantially with the congress made no mention of new initiatives” and instead said that “officials will review the implementation of economic guidelines adopted in 2011, only 21% have been put fully into practice.” [2]

Some believe President Obama’s March visit to the island “stirred great enthusiasm among ordinary people who do want change and are pushing for a better life, thereby putting pressure on Cuba’s leaders. Related to this thought is speculation that there might be a move to more selection of leaders by popular vote. Doing so for the National Assembly seems exceedingly unlikely, but such a move might come with direct election of mayors.

The Congress will be facing a vastly different economy than when it met in 2011. Now about a quarter of the labor force are working in a growing private sector, many in the booming tourist trade and are doing well financially The other 75% of the population who depend on state-sector jobs are struggling to survive on salaries that average about $25 a month, as consumer prices spike.

Many of those in the private sector now are limited to an odd list of 201 occupations that runs from cutting hair to acting as clowns in parties and want to see a greater liberalization that would permit professionals, such as lawyers, engineers and architects, to strike out on their own.

Other economic issues facing the Congress are (a) whether foreign joint ventures will have the freedom to hire Cuban workers directly, instead of having to go through state employment companies that keep most of their salaries; and (b) whether the government will create a legal framework for small and medium-size businesses to be able to export and buy supplies from a now largely nonexistent wholesale sector.

Observers also are watching to see if Miguel Diaz Canel, who was named first vice president of Cuba’s Council of State three years ago, and is widely regarded as Raúl Castro’s successor, will be promoted to second secretary of the Communist Party, succeeding the 85-year-old hard-liner José Ramón Machado Ventura.

A New York Times’ editorial complained that any economic reforms to come out of the Congress “remain a mystery to all but a few senior leaders of the party. While the policy review that preceded the last party conference, in 2011, included broad debate by rank-and-file party members, this time top officials have not shared information with them or solicited their views.” [3]

This “surreptitious approach,” says the Times, “s shortsighted at a time of change and rising discontent. Ordinary Cubans, including those who are critical of the Communist Party, should have a say in how the country will be run and by whom, without fear of reprisal and persecution.” Moreover, “If reforms continue at a glacial pace, young Cubans will keep fleeing the island in droves, fueling a exodus that has become a referendum of sorts.”

Now we wait to see what happens.

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[1] Morales, Looking toward 7th Party Congress, Granma (Feb. 29, 2016); Party congress less than a month away, Granma (Mar. 28, 2016);Eight questions about the Party Congress, Granma (April 14, 2016); 7th Party Congress begins, Granma (April 16, 2016). Here is more general U.S. information about the Communist Party of Cuba and its Sixth Congress.

[2] Assoc. Press, Cuba’s Future Economic Model in Spotlight at Party Congress, N.Y. Times (April 8, 2016); Padgett, Party Time In Cuba—With Marx, Not Mojitos. Here is What the Congress Might Do,,WRLN (April 12, 2016); Córdoba, Post-Obama Visit, Cuba’s Communist Party to Signal Next Steps, W.S.J. (April 15, 2016); Whitefield, Cuba’s Communist Party meets at critical time for country, Miami Herald (April 15, 2016); Assoc. Press, In Slow Dance With Capitalism, Cuba’s Communists Turn to Future, N.Y. Times (April 16, 2016).

 

 

 

 

 

[3] Editorial, Cuba’s Path to the Future Is Shrouded in Secrecy, N.Y. Times (April 15, 2016) http://www.nytimes.com/2016/04/16/opinion/cubas-path-to-the-future-is-shrouded-in-secrecy.html?ref=opinion