{"id":213061,"date":"2020-01-30T00:00:27","date_gmt":"2020-01-30T05:00:27","guid":{"rendered":"https:\/\/oncubanews.com\/en\/?p=213061"},"modified":"2020-01-30T22:15:36","modified_gmt":"2020-01-31T03:15:36","slug":"cuban-smes-still-waiting-for-law-to-regulate-them","status":"publish","type":"post","link":"https:\/\/oncubanews.com\/en\/cuba\/cuban-smes-still-waiting-for-law-to-regulate-them\/","title":{"rendered":"Cuban SMEs still waiting for law to regulate them"},"content":{"rendered":"<p><span style=\"font-weight: 400;\">In 2006, Geraudis Mustelier was an employee of the Cuban government whose job was to support the organization and accounting of several firms. Now he has his own management business and important corporations on the island stand out among his 400 clients, but by law his business is not an enterprise.<\/span><\/p>\n<p><span style=\"font-weight: 400;\">The lack of a norm that formalizes small and medium-sized enterprises (SMEs) in Cuba\u2015inherited from Soviet statism that stigmatized the private sector\u2015still limits the development of entrepreneurs like Mustelier.<\/span><\/p>\n<p><span style=\"font-weight: 400;\">\u201cThere\u2019s a cultural, mental resistance to change,\u201d Mustelier said to <em>AP<\/em>.<\/span><\/p>\n<blockquote class=\"wp-embedded-content\" data-secret=\"K7GD6gDx5H\"><p><a href=\"https:\/\/oncubanews.com\/cuba\/las-cifras-de-desempleo-en-cuba-disminuyeron-en-2019-segun-el-gobierno\/\">D\u00edaz-Canel reconoce que hay que \u201cdestrabar\u201d las cooperativas y las PYMES en Cuba<\/a><\/p><\/blockquote>\n<p><iframe loading=\"lazy\" class=\"wp-embedded-content\" sandbox=\"allow-scripts\" security=\"restricted\" style=\"position: absolute; clip: rect(1px, 1px, 1px, 1px);\" title=\"\u00abD\u00edaz-Canel reconoce que hay que \u201cdestrabar\u201d las cooperativas y las PYMES en Cuba\u00bb \u2014 OnCubaNews\" src=\"https:\/\/oncubanews.com\/cuba\/las-cifras-de-desempleo-en-cuba-disminuyeron-en-2019-segun-el-gobierno\/embed\/#?secret=wB9xiq3R1V#?secret=K7GD6gDx5H\" data-secret=\"K7GD6gDx5H\" width=\"500\" height=\"282\" frameborder=\"0\" marginwidth=\"0\" marginheight=\"0\" scrolling=\"no\"><\/iframe><\/p>\n<p><span style=\"font-weight: 400;\">He and other colleagues operate as \u201c<\/span><a href=\"https:\/\/oncubanews.com\/tag\/trabajo-por-cuenta-propia\/\" target=\"_blank\" rel=\"noopener noreferrer\"><span style=\"font-weight: 400;\">self-employed<\/span><\/a><span style=\"font-weight: 400;\">,\u201d which implies that, among other things, they cannot separate their personal finances from those of their businesses, have schemes for bankruptcies or differentiated tax systems.<\/span><\/p>\n<p><span style=\"font-weight: 400;\">At the end of December, it was reported that Parliament was studying the possibility of enacting a Law on Enterprises that would regulate state and private enterprises, but there are no details about it. It would be ready by April 2022, deputies said, although officials said progress could be made in regulatory measures starting this year.<\/span><\/p>\n<p><span style=\"font-weight: 400;\">Mustelier and half a dozen entrepreneurs with whom AP spoke indicated, in addition, that the norm would benefit them because it would free them from being exposed to the swings of leaders who urge them to wait or dictate contradictory decrees, give security to their clients and allow them to import inputs and export products. Likewise, they could participate in a wholesale market when it is opened and benefit in fiscal matters by deducting taxes for investment in innovation or according to the size of their operations.<\/span><\/p>\n<div id='gallery-1' class='gallery galleryid-213061 gallery-columns-1 gallery-size-full'><figure class='gallery-item'>\n\t\t\t<div class='gallery-icon landscape'>\n\t\t\t\t<a href='https:\/\/oncubanews.com\/en\/cuba\/cuban-smes-still-waiting-for-law-to-regulate-them\/attachment\/cuba-empresas-privadas-9\/'><img loading=\"lazy\" decoding=\"async\" width=\"1024\" height=\"668\" src=\"https:\/\/oncubanews.com\/en\/wp-content\/uploads\/2020\/01\/cuba-empresas-privadas-7-1.jpg\" class=\"attachment-full size-full\" alt=\"\" aria-describedby=\"gallery-1-213063\" srcset=\"https:\/\/oncubanews.com\/en\/wp-content\/uploads\/2020\/01\/cuba-empresas-privadas-7-1.jpg 1024w, https:\/\/oncubanews.com\/en\/wp-content\/uploads\/2020\/01\/cuba-empresas-privadas-7-1-300x196.jpg 300w, https:\/\/oncubanews.com\/en\/wp-content\/uploads\/2020\/01\/cuba-empresas-privadas-7-1-768x501.jpg 768w, https:\/\/oncubanews.com\/en\/wp-content\/uploads\/2020\/01\/cuba-empresas-privadas-7-1-750x489.jpg 750w\" sizes=\"auto, (max-width: 1024px) 100vw, 1024px\" \/><\/a>\n\t\t\t<\/div>\n\t\t\t\t<figcaption class='wp-caption-text gallery-caption' id='gallery-1-213063'>\n\t\t\t\tPhoto: AP\/Ismael Francisco.\n\t\t\t\t<\/figcaption><\/figure><figure class='gallery-item'>\n\t\t\t<div class='gallery-icon landscape'>\n\t\t\t\t<a href='https:\/\/oncubanews.com\/en\/cuba\/cuban-smes-still-waiting-for-law-to-regulate-them\/attachment\/cuba-empresas-privadas-10\/'><img loading=\"lazy\" decoding=\"async\" width=\"1024\" height=\"602\" src=\"https:\/\/oncubanews.com\/en\/wp-content\/uploads\/2020\/01\/cuba-empresas-privadas-4-1.jpg\" class=\"attachment-full size-full\" alt=\"\" aria-describedby=\"gallery-1-213064\" srcset=\"https:\/\/oncubanews.com\/en\/wp-content\/uploads\/2020\/01\/cuba-empresas-privadas-4-1.jpg 1024w, https:\/\/oncubanews.com\/en\/wp-content\/uploads\/2020\/01\/cuba-empresas-privadas-4-1-300x176.jpg 300w, https:\/\/oncubanews.com\/en\/wp-content\/uploads\/2020\/01\/cuba-empresas-privadas-4-1-768x452.jpg 768w, https:\/\/oncubanews.com\/en\/wp-content\/uploads\/2020\/01\/cuba-empresas-privadas-4-1-750x441.jpg 750w\" sizes=\"auto, (max-width: 1024px) 100vw, 1024px\" \/><\/a>\n\t\t\t<\/div>\n\t\t\t\t<figcaption class='wp-caption-text gallery-caption' id='gallery-1-213064'>\n\t\t\t\tPhoto: AP\/Ismael Francisco.\n\t\t\t\t<\/figcaption><\/figure><figure class='gallery-item'>\n\t\t\t<div class='gallery-icon landscape'>\n\t\t\t\t<a href='https:\/\/oncubanews.com\/en\/cuba\/cuban-smes-still-waiting-for-law-to-regulate-them\/attachment\/cuba-empresas-privadas-11\/'><img loading=\"lazy\" decoding=\"async\" width=\"1024\" height=\"683\" src=\"https:\/\/oncubanews.com\/en\/wp-content\/uploads\/2020\/01\/cuba-empresas-privadas-1-1.jpg\" class=\"attachment-full size-full\" alt=\"\" aria-describedby=\"gallery-1-213065\" srcset=\"https:\/\/oncubanews.com\/en\/wp-content\/uploads\/2020\/01\/cuba-empresas-privadas-1-1.jpg 1024w, https:\/\/oncubanews.com\/en\/wp-content\/uploads\/2020\/01\/cuba-empresas-privadas-1-1-300x200.jpg 300w, https:\/\/oncubanews.com\/en\/wp-content\/uploads\/2020\/01\/cuba-empresas-privadas-1-1-768x512.jpg 768w, https:\/\/oncubanews.com\/en\/wp-content\/uploads\/2020\/01\/cuba-empresas-privadas-1-1-750x500.jpg 750w\" sizes=\"auto, (max-width: 1024px) 100vw, 1024px\" \/><\/a>\n\t\t\t<\/div>\n\t\t\t\t<figcaption class='wp-caption-text gallery-caption' id='gallery-1-213065'>\n\t\t\t\tPhoto: AP\/Ismael Francisco.\n\t\t\t\t<\/figcaption><\/figure>\n\t\t<\/div>\n\n<p><span style=\"font-weight: 400;\">For some entrepreneurs and experts, this law would be positive for the country and the development of SMEs would contribute to supply the population, which in recent months ran into empty shelves in the midst of an intensification of U.S. sanctions\u2015which limits imports\u2015, and absorb the million state posts that could disappear because of a previously announced reform.<\/span><\/p>\n<p><span style=\"font-weight: 400;\">In the last decade, Cuba took some steps towards private initiative\u2015which allowed for example the emergence of Gemus, Mustelier&#8217;s firm, and other businesses\u2015but in recent years their level seems to have hit a ceiling.<\/span><\/p>\n<p><span style=\"font-weight: 400;\">Former President Ra\u00fal Castro started in 2010 an opening policy in a country where 80% of the workforce was linked to the State and the entrepreneurship of individuals was stigmatized as a capitalist danger. Even private property achieved recognition just a few months ago, under the new Constitution, in force since April 2019.<\/span><\/p>\n<p><span style=\"font-weight: 400;\">In the heat of the changes, many areas were transformed with the establishment of cafes, restaurants, lodging houses, workshops or sale of products. Entrepreneurs sought ways to attract customers and tripled the income of many families.<\/span><\/p>\n<p><span style=\"font-weight: 400;\">Of the 157,351 licenses that existed in 2010 in some trades, such as cobblers or taxi drivers, they now reached 600,000 in many sectors.<\/span><\/p>\n<blockquote class=\"wp-embedded-content\" data-secret=\"S8tfgkY882\"><p><a href=\"https:\/\/oncubanews.com\/cuba\/cuba-sobrepasa-los-600-000-trabajadores-en-el-sector-privado\/\">Cuba sobrepasa los 600.000 trabajadores en el sector privado<\/a><\/p><\/blockquote>\n<p><iframe loading=\"lazy\" class=\"wp-embedded-content\" sandbox=\"allow-scripts\" security=\"restricted\" style=\"position: absolute; clip: rect(1px, 1px, 1px, 1px);\" title=\"\u00abCuba sobrepasa los 600.000 trabajadores en el sector privado\u00bb \u2014 OnCubaNews\" src=\"https:\/\/oncubanews.com\/cuba\/cuba-sobrepasa-los-600-000-trabajadores-en-el-sector-privado\/embed\/#?secret=ftUXPRp1K5#?secret=S8tfgkY882\" data-secret=\"S8tfgkY882\" width=\"500\" height=\"282\" frameborder=\"0\" marginwidth=\"0\" marginheight=\"0\" scrolling=\"no\"><\/iframe><\/p>\n<p><span style=\"font-weight: 400;\">During this time, the relationship between the government and the entrepreneurs was not exempt from ups and downs. At some point the authorities canceled giving licenses, although they later resumed it.<\/span><\/p>\n<p><span style=\"font-weight: 400;\">The <\/span><a href=\"https:\/\/oncubanews.com\/tag\/economia-cubana\/\" target=\"_blank\" rel=\"noopener noreferrer\"><span style=\"font-weight: 400;\">Cuban economy<\/span><\/a><span style=\"font-weight: 400;\"> is facing challenges in addition to the U.S. sanctions\u2015to unify its currency, among them\u2015so some experts believe that the possible Law on Enterprises would boost finances.<\/span><\/p>\n<p><span style=\"font-weight: 400;\">At the end of 2019 the authorities reported that Cuba&#8217;s GDP had grown 0.5%, instead of the 5% or 7% that the leaders themselves mentioned was necessary to get the country out of the crisis.<\/span><\/p>\n<p><span style=\"font-weight: 400;\">\u201cTo the point where the Cuban economy is unable to continue functioning on the basis of emergencies, there must be a sedimentation in the future,\u201d Cuban economist Omar Everleny P\u00e9rez, who supports the early sanction of the Law on Enterprises, told <em>AP<\/em>.<\/span><\/p>\n<p><span style=\"font-weight: 400;\">Since there are several exchange rates in the country that benefit some large state-owned enterprises, the financial reform would show which ones are inefficient and should be closed, which would leave workers without jobs.<\/span><\/p>\n<p><span style=\"font-weight: 400;\">\u201cIf you are going to allow the bankruptcy of the state enterprise (with the reform), those workers, where would they go?\u201d P\u00e9rez asked. \u201cIt&#8217;s not about installing the capitalist germ or the market economy, but about balance.\u201d<\/span><\/p>\n<p><span style=\"font-weight: 400;\">Economies such as the Japanese, the Mexican and those of some European nations base their development and generate jobs through small and medium-sized entrepreneurs.<\/span><\/p>\n<div id='gallery-2' class='gallery galleryid-213061 gallery-columns-1 gallery-size-full'><figure class='gallery-item'>\n\t\t\t<div class='gallery-icon landscape'>\n\t\t\t\t<a href='https:\/\/oncubanews.com\/en\/cuba\/cuban-smes-still-waiting-for-law-to-regulate-them\/attachment\/cuba-empresas-privadas-12\/'><img loading=\"lazy\" decoding=\"async\" width=\"1024\" height=\"668\" src=\"https:\/\/oncubanews.com\/en\/wp-content\/uploads\/2020\/01\/cuba-empresas-privadas-2-1.jpg\" class=\"attachment-full size-full\" alt=\"\" aria-describedby=\"gallery-2-213067\" srcset=\"https:\/\/oncubanews.com\/en\/wp-content\/uploads\/2020\/01\/cuba-empresas-privadas-2-1.jpg 1024w, https:\/\/oncubanews.com\/en\/wp-content\/uploads\/2020\/01\/cuba-empresas-privadas-2-1-300x196.jpg 300w, https:\/\/oncubanews.com\/en\/wp-content\/uploads\/2020\/01\/cuba-empresas-privadas-2-1-768x501.jpg 768w, https:\/\/oncubanews.com\/en\/wp-content\/uploads\/2020\/01\/cuba-empresas-privadas-2-1-750x489.jpg 750w\" sizes=\"auto, (max-width: 1024px) 100vw, 1024px\" \/><\/a>\n\t\t\t<\/div>\n\t\t\t\t<figcaption class='wp-caption-text gallery-caption' id='gallery-2-213067'>\n\t\t\t\tPhoto: AP\/Ismael Francisco.\n\t\t\t\t<\/figcaption><\/figure><figure class='gallery-item'>\n\t\t\t<div class='gallery-icon landscape'>\n\t\t\t\t<a href='https:\/\/oncubanews.com\/en\/cuba\/cuban-smes-still-waiting-for-law-to-regulate-them\/attachment\/cuba-empresas-privadas-13\/'><img loading=\"lazy\" decoding=\"async\" width=\"1024\" height=\"697\" src=\"https:\/\/oncubanews.com\/en\/wp-content\/uploads\/2020\/01\/cuba-empresas-privadas-3-1.jpg\" class=\"attachment-full size-full\" alt=\"\" aria-describedby=\"gallery-2-213068\" srcset=\"https:\/\/oncubanews.com\/en\/wp-content\/uploads\/2020\/01\/cuba-empresas-privadas-3-1.jpg 1024w, https:\/\/oncubanews.com\/en\/wp-content\/uploads\/2020\/01\/cuba-empresas-privadas-3-1-300x204.jpg 300w, https:\/\/oncubanews.com\/en\/wp-content\/uploads\/2020\/01\/cuba-empresas-privadas-3-1-768x523.jpg 768w, https:\/\/oncubanews.com\/en\/wp-content\/uploads\/2020\/01\/cuba-empresas-privadas-3-1-750x510.jpg 750w\" sizes=\"auto, (max-width: 1024px) 100vw, 1024px\" \/><\/a>\n\t\t\t<\/div>\n\t\t\t\t<figcaption class='wp-caption-text gallery-caption' id='gallery-2-213068'>\n\t\t\t\tPhoto: AP\/Ismael Francisco.\n\t\t\t\t<\/figcaption><\/figure><figure class='gallery-item'>\n\t\t\t<div class='gallery-icon landscape'>\n\t\t\t\t<a href='https:\/\/oncubanews.com\/en\/cuba\/cuban-smes-still-waiting-for-law-to-regulate-them\/attachment\/cuba-empresas-privadas-14\/'><img loading=\"lazy\" decoding=\"async\" width=\"1024\" height=\"683\" src=\"https:\/\/oncubanews.com\/en\/wp-content\/uploads\/2020\/01\/cuba-empresas-privadas-6-1.jpg\" class=\"attachment-full size-full\" alt=\"\" aria-describedby=\"gallery-2-213069\" srcset=\"https:\/\/oncubanews.com\/en\/wp-content\/uploads\/2020\/01\/cuba-empresas-privadas-6-1.jpg 1024w, https:\/\/oncubanews.com\/en\/wp-content\/uploads\/2020\/01\/cuba-empresas-privadas-6-1-300x200.jpg 300w, https:\/\/oncubanews.com\/en\/wp-content\/uploads\/2020\/01\/cuba-empresas-privadas-6-1-768x512.jpg 768w, https:\/\/oncubanews.com\/en\/wp-content\/uploads\/2020\/01\/cuba-empresas-privadas-6-1-750x500.jpg 750w\" sizes=\"auto, (max-width: 1024px) 100vw, 1024px\" \/><\/a>\n\t\t\t<\/div>\n\t\t\t\t<figcaption class='wp-caption-text gallery-caption' id='gallery-2-213069'>\n\t\t\t\tPhoto: AP\/Ismael Francisco.\n\t\t\t\t<\/figcaption><\/figure>\n\t\t<\/div>\n\n<p><span style=\"font-weight: 400;\">\u201cEighty-five percent of jobs in Europe are SMEs,\u201d the ambassador of the European Union in Cuba, Alberto Navarro, told AP. \u201cWe would like to have a relevant investment fund to boost European and Cuban SMEs, but for that it is necessary that Cuba also approves small and medium-sized enterprises.\u201d<\/span><\/p>\n<p><span style=\"font-weight: 400;\">The SME \u201cis more resistant against sanctions, against the U.S. <\/span><a href=\"https:\/\/oncubanews.com\/tag\/bloqueo\/\" target=\"_blank\" rel=\"noopener noreferrer\"><span style=\"font-weight: 400;\">blockade<\/span><\/a><span style=\"font-weight: 400;\"> because the United States can fine or sanction a large company, a large bank, but it will be much harder for it to attack the small and medium-sized enterprises,\u201d Navarro predicted.<\/span><\/p>\n<p><span style=\"font-weight: 400;\">The United States imposed such strong sanctions on Cuba this year to stifle its economy and press for a change in the political model, that Washington even pursued ships that bring oil to the island or limited travel to prevent the Caribbean nation from receiving tourism revenue.<\/span><\/p>\n<figure id=\"attachment_213070\" aria-describedby=\"caption-attachment-213070\" style=\"width: 1024px\" class=\"wp-caption aligncenter\"><a href=\"https:\/\/oncubanews.com\/en\/wp-content\/uploads\/2020\/01\/cuba-empresas-privadas-5-1.jpg\"><img loading=\"lazy\" decoding=\"async\" class=\"size-full wp-image-213070\" src=\"https:\/\/oncubanews.com\/en\/wp-content\/uploads\/2020\/01\/cuba-empresas-privadas-5-1.jpg\" alt=\"\" width=\"1024\" height=\"670\" srcset=\"https:\/\/oncubanews.com\/en\/wp-content\/uploads\/2020\/01\/cuba-empresas-privadas-5-1.jpg 1024w, https:\/\/oncubanews.com\/en\/wp-content\/uploads\/2020\/01\/cuba-empresas-privadas-5-1-300x196.jpg 300w, https:\/\/oncubanews.com\/en\/wp-content\/uploads\/2020\/01\/cuba-empresas-privadas-5-1-768x503.jpg 768w, https:\/\/oncubanews.com\/en\/wp-content\/uploads\/2020\/01\/cuba-empresas-privadas-5-1-750x491.jpg 750w\" sizes=\"auto, (max-width: 1024px) 100vw, 1024px\" \/><\/a><figcaption id=\"caption-attachment-213070\" class=\"wp-caption-text\">Iv\u00e1n Rodr\u00edguez, 25, and owner of Futurecell, a cell phone repair shop, in his shop in Havana, Cuba, on Monday, January 13, 2020. Photo: AP\/Ismael Francisco.<\/figcaption><\/figure>\n<p><span style=\"font-weight: 400;\">The <\/span><a href=\"https:\/\/oncubanews.com\/tag\/donald-trump-es\/\" target=\"_blank\" rel=\"noopener noreferrer\"><span style=\"font-weight: 400;\">Donald Trump<\/span><\/a><span style=\"font-weight: 400;\"> administration went so far as to allow third-country companies that dare to operate with Cuba to be brought to trial in order to deter their participation here.<\/span><\/p>\n<p><span style=\"font-weight: 400;\">\u201cThe non-existence of a law on enterprises&#8230;greatly limits the private sector in Cuba,\u201d Camilo Condis, an industrial engineer who has an electric service business, told AP. \u201cIt is our own internal blockade. The private sector is bound hand and foot and prevented from growing organically to play a greater role in the development of the economy.\u201d<\/span><\/p>\n","protected":false},"excerpt":{"rendered":"<p>In 2006, Geraudis Mustelier was an employee of the Cuban government whose job was to support the organization and accounting of several firms. Now he has his own management business and important corporations on the island stand out among his 400 clients, but by law his business is not an enterprise. The lack of a [&hellip;]<\/p>\n","protected":false},"author":3612,"featured_media":213071,"comment_status":"open","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":{"_acf_changed":false,"footnotes":""},"categories":[13902],"tags":[14816,14914],"ppma_author":[34014,17428],"class_list":["post-213061","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-cuba","tag-cuban-economy","tag-cuban-private-sector"],"acf":[],"yoast_head":"<!-- This site is optimized with the Yoast SEO plugin v27.3 - https:\/\/yoast.com\/product\/yoast-seo-wordpress\/ -->\n<title>Cuban SMEs still waiting for law to regulate them | OnCubaNews English<\/title>\n<meta name=\"description\" content=\"The lack of a norm that formalizes small and medium-sized enterprises (SMEs) in Cuba\u2015inherited from Soviet statism that stigmatized the private sector\u2015still limits the development of entrepreneurs.\" \/>\n<meta name=\"robots\" content=\"index, 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