Since the revolution in 1960, Cuba has been a democratic socialist country. To most Americans, the concept is extremely foreign. Many of the questions we have had during our meetings in the country thus far question if privatization is possible, and what it is like living day to day in a socialist country. A few highlights on this topic from the trip so far…
2013 marked a new era for the country, with the passing of legislation allowing private (mainly touristic) businesses to operate. Small business owners now have to pay taxes on their businesses, a concept that had been foreign to Cubans until this time.
Cubans receive free healthcare, education, some rationed food, and social services but are otherwise paid state sanctioned wages of the equivalent of $20-30 USD a month. There is opportunity to make more than the state wage in the private sector through tips and contact with foreign tourists.
The US Cuban Embargo means that businesses who need supplies need contacts in the US to buy supplies for them, and bring them back in their luggage. Anything that cannot fit in luggage is sent through other countries – for example, Julio who restores cars has large parts shipped through three different countries before it can come to Cuba.
Foreign investment has begun to bloom in Cuba – much to the benefit of the government. Swiss hotel company Manzana Kempinski operates a hotel in Havana. They earn 17% of revenues and 1% of profits, and the Cuban government takes the rest.
The journalists, lawyers, educators and urban planners all agree that public healthcare and education has worked well for Cuba, but changes have and will continue to occur in the market, as Cuba’s GDP has been contracting and private businesses have afforded Cuba new avenues of growth.
-Jill Wang ’18