Credit policy expanding privately owned Cuban businesses

By Admin Wednesday July 25 2012 in Caribbean
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HAVANA, Cuba: A new credit policy implemented in Cuba has thus far benefitted over 49,900 citizens, according to the president-minister of Central Bank of Cuba (BCC), Ernesto Medina.


In his recent report to Cuban lawmakers, Medina said that the total bulk of credit lines have reached 347-million Cuban pesos, particularly granted to citizens for home repairs and the purchase of construction materials.


Medina said that as credit lines continue to be granted, the institutions involved in the initiative continue to improve their work to expand the access to credit. The official explained that the measure also benefits the sugar and agriculture sectors, in an effort to encourage production.


Cubans are increasingly renting state-owned facilities to develop private businesses after a resolution allowing this initiative was adopted last December by the ministries of Foreign Trade, Finance and Prices, and Labour and Social Security.


The measure, in tune with the updating of the Cuban economy, aims at making more efficient use of former state facilities by renting them to self-employed workers in modalities, such as barber shops, beauty parlours and shoe repairers. In the eastern Camaguey province, for instance, the Technical, Personal and Home Services Enterprise has seen its income grow with the rental of its facilities to private workers.


Enterprise vice-director, Martha Pichs, described the initiative as effective.


While the measure was first implemented as a pilot project in June 2010, 80 facilities have already been rented and 182 private workers are developing their businesses.


Ariel Garcia is a regular client at one of these barber shops and he told the Cuban news agency that he considers the quality and performance of the service very appropriate given the attention he has received by the workers. Meanwhile, Eralides Araujo, a barber, said he is happy to have rented the place for his private activity, which helps him get a higher income.


Barber shops and beauty parlours used to be state-run services guaranteeing a fixed, low cost to the public and a monthly salary to workers for eight hours of work daily. With the new initiative, the prices of different services offered are set by the private workers, according to demand and the quality of their work.


Other trades are currently developing in the province as part of the initiative, such as jewellery making, photography, carpentry and shoe making and repairs, said the executive.


Though the number of private services in these modalities is increasing as encouraged by the new rental opportunities, there are still state-run services, such as barber shops for children and beauty parlours.


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