Cuba will start 2021 with a single currency

Cuba will start 2021 with a single currency

Business

Cubaplus courtesy of Prensa Latina

Cuba will start 2021 with the peso as its only national currency as part of the monetary system, a decision that will entail a process of information to the population about this momentous decision.

As President Miguel Díaz-Canel announced the day before, in the presence of the first secretary of the Communist Party of Cuba, Raúl Castro Ruz, this step is part of the Economic and Social Strategy to promote the economic development of the country.

In the information offered to the people by radio and television, the head of State said that as of January 1, a single exchange rate of 24 pesos to one dollar will be applied.

As has been explained, this monetary ordering process implies a new exchange rate, the cessation of the circulation of the CUC, the elimination of excessive subsidies and undue gratuities, and a modification in income distribution.

The dignitary specified that for the implementation of the monetary and exchange unification, the corresponding elaboration and analysis were concluded, as well as all the necessary legal norms, so it is considered that the conditions for the start of the Ordering Task have been created.

Díaz-Canel explained that in the new economic and social strategy to boost the economy approved this year, the monetary order is ratified as one of the fundamental and transcendentally important components with a cross-cutting impact throughout the economy.

The objective of this task is to put the country in better conditions to carry out the transformations for updating the economic and social model to guarantee for all Cubans greater opportunities, rights and social justice, added the president.

Such a purpose will be possible not through egalitarianism, but by promoting interest and motivation in work, while ratifying the principle of not leaving any citizen helpless, since shock therapies will not be applied against the people, says the government.

The information offered insists on the complexity of this order, increased by the effects of the intensified US blockade, the situation of the COVID-19 pandemic, the international economic crisis and the impacts on the national economy.

Cuba currently has an exchange rate for the population (25 CUP = 1 CUC = 1 USD), and another for state enterprises or legal persons (1 CUC = 1 CUP = 1 USD), which generates confusion as to the real costs of business activity and distorts profitability analyses.

The Cuban president warned last October that 'monetary and exchange unification does not constitute the magic solution to economic and financial problems, but it should lead the country to increase labor productivity and a more efficient performance of productive forces'.