The Challenges of Cuba's Economy

An Interview with Dr. Antonio Romero

Director of Havana University's Center for 
Research on International Economy (CIEI)
I S L A :Tell us about the role CIEI (Center for Research on International Economy) plays in the study and analysis of Cuba's international relations.

Romero: The CIEI was established in 1970, and is affiliated with Havana University. Our main objective is teaching and research in the field of international economic relations. Thus, we work not only with Havana University, but with other higher education centers in Cuba, developing study plans for international relations courses. We are also a specialized research center, so we respond to queries from other Cuban organizations that need information on Cuba's international economic situation.

I S L A :How has Cuba responded to international pressure, especially from the U.S., to carry out changes in its economy in order to become incorporated into the global market?

A. R. : That is a complex question. In the first place, I'd say that any discussion about change in Cuba must first begin by clarifying what is understood by "change." In my opinion, important changes have happened in the Cuban economy and society during the last years. These changes are complex and often contradictory, but without doubt they point towards a more diversified society, and towards the establishment of communication channels with the outside world. Transformations have occurred in property ownership, employment systems, and income levels to the extent that today we have a particular kind of mixed economy. 

Now, the question is to what extent these changes are in tune with Cuba's alternative project. The strategies followed thus far in the economic arena can be seen as an adequate response to external pressures. Let's remember that the Cuban economic situation had deteriorated so badly by 1994, that no one believed the country's socialist system could survive another year. Although the measures taken to cope with the crisis have resulted in sometimes contradictory policies, our situation has turned better, and international debates on Cuba no longer predict a "domino effect" collapse of our system.

I S L A :Could changes taking place in Cuba be compared to the Soviet Perestroika?

A. R. : To begin with, it must be stressed that Cuba is not a world power as the Soviet Union used to be. In second place, the international context and strategic location of Cuba is very different from the context in which the Perestroika process developed. Cuba is a country that suffers from a blockade by the U.S. It struggles within a unipolar world, that is, a world where military, ideological and economic power is controlled mainly from the U.S. Given these conditions, it is unlikely that Cuba's historical leadership will soon undertake a transformation of its political structure. Moreover, there's no consensus within Cuban society on what kind of transformation should take place. I do believe that the advances and contradictions within Cuban economy today call for a step forward, regardless of what you call it, reform, opening, or economic restructuring. I don't know to what extent that would entail changes in the political system. Of course, Marxist theory holds that any changes in economic structure have to be accompanied by political transformations. However, I doubt this means Cuba is moving towards a capitalist regime, especially since there's no consensus in Cuban society regarding such a move. 

I S L A :Tell us about the multilateral treaties that Cuba has been developing in order to overcome the U.S. blockade. Has the Helms-Burton law hampered these agreements?

A. R. : Presently, there's a process of rearticulating Cuba's international economic relations. In spite of its contradicitons, the process has been successful, especially if we consider that Cuba had to break its economic relations with the countries of COMECON (Council for Mutual Economic Aid, an economic association of European socialist countries abolished in 1991) which made up 85% of all our foreign trade. This forced our top economists and policy makers to work towards restructuring our foreign trade networks. We have been gaining experience in placing our products in international markets within this difficult context.

A complex situation, for example, is our trade with other Latin American countries. Let's remember that the U.S. has strong economic ties with the region. With this in mind, any agreement that Cuba reaches with a Latin American country must take into account the strong U.S. interests at stake there.

I S L A :What's the nature of Cuba's new relationship with Caribbean countries?

There have been a series of efforts during the last months to reach official agreements with our neighboring Caribbean countries. Cuba has been admitted as a member of the ACP (African, Caribbean and Pacific Countries) group. We are also trying to reach a higher status in the ALADI (Latin American Integration Association) group, and we are exploring a new relationship with the MercoSur countries. I see these as important developments. Moreover, let's remember that Cuba is a member of OMC (OrganizaciÛn Mundial de Comercio/World Trade Organization). One of the key challenges facing Cuba today is to follow up on the commitments it adopted, as an OMC member, when signing the Marrakech Agreements during the last Uruguay Round (in April of 1994).

As you can see, there are diverse multilateral efforts that Cuba is involved with in order to maintain foreign trade, and this is within the context of a hemispheric free trade initiative from which Cuba is the region's only excluded country.

I S L A :Lifting the blockade and becoming integrated into global capitalism would be a huge change for the Cuban people, yet a possible effect of that scenario might be losing the path of the Revolution. How are Cuban authorities facing that dilemma?

A. R. : Indeed, lifting the blockade would bring about important changes, especially in Cuba's foreign economic relations. But to say that that would lead to an erosion of the Cuban political regime is questionable. And I say this for a very simple reason. Regardless of the criticism of Cuba's regime, I think our leaders have experience and intelligence. How, then, could we explain our leaders calling for an end to the blockade, if such a move would supposedly destabilize the regime? 

From my perspective as an economist, I think that lifting the blockade is important, and it would bring positive things to the island. It will also create big challenges for Cuba. In a post-blockade scenario, Cuba's biggest challenge will be to maintain both national and economic sovereignty. Our country would need to move forward in its level of productivity and efficiency, in order to guarantee international competetiveness. This way, we might attain a less asymmetrical relationship with a world power such as the U.S.

Interview by Antonio Prieto


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