Manuel Marrero, Cuba’s Prime Minister, has admitted that many of the consumer prices at its state-owned Foreign Currency Collection Stores (TRDs) are more expensive for the same products sold in the privately owned stores (MSMEs).[1]
Nevertheless, Marrero asserted, “It is unfair to make that analysis. Our TRDs are faced with a complex scenario, they do not buy those resources, chicken, oil, in the same markets where private companies do; they do not work with the illegal currency market, but rather they value the dollar at 120 pesos, therefore, the analysis is different. The TRDs have to buy in more distant markets at more expensive prices.”
That assertion is faulty. “Container terminals, warehouses in ports, means of transport, dry and refrigerated warehouses located throughout the country, thousands of retail outlets and banks to finance the process, all of that is owned by the State and none of it by the private sector.”
Moreover, the State enterprises have “Tens of thousands of workers earning miserable wages, more than 60 years of experience in the business, discounts for purchase and freight volumes, decades of relationships with suppliers around the world, beneficial agreements with allied governments such as China, Vietnam, Venezuela or Mexico, subsidies and billions in forgiven debts.” And “the private sector has none of” those benefits.
In other words, Marrero has implicitly acknowledged that the Cuban “Government knows – as the entire universe knows – that the private sector is infinitely more efficient than the state sector and, therefore, this miserable Cuba is the product of the stubbornness of maintaining socialism as a policy , a system that has demonstrably failed to generate wealth, although extremely efficient to sustain dictatorships, which is what matters to Marrero and his gang.”
In short, Marrero recognizes that “Cuba’s problem is not the [U.S.] embargo, but the Castro regime’s insistence on maintaining an absolutely inefficient political-economic model that, on top of that, has limited its ability to negotiate in the closest and cheapest market [the U.S.] for Cuba. The prime minister has made it clear that the problem of this island is not the American embargo on the state sector, but the Castro blockade of the private sector.”
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[1] Cruz, Justifying the Cuban regime, Marrero buries it, Diario de Cuba (July 19, 2024).