{"id":2176,"date":"2013-01-07T17:49:39","date_gmt":"2013-01-07T17:49:39","guid":{"rendered":""},"modified":"2013-06-21T23:16:29","modified_gmt":"2013-06-21T23:16:29","slug":"inadequacies-wages-and-incomes-cuba","status":"publish","type":"post","link":"https:\/\/oncubanews.com\/en\/economy-business\/inadequacies-wages-and-incomes-cuba\/","title":{"rendered":"The inadequacies of wages and incomes in Cuba"},"content":{"rendered":"<p><span lang=\"EN-US\">The recurrent theme of wages and incomes in any analysis of the daily life of the Cuban people demands a deeper analysis on the complicated reality of what is necessary and possible: increasing wages and income must correspond to the growth in production.<o p=\"\"><\/o><\/span><\/p>\n<p class=\"MsoNormal\"><span lang=\"EN-US\">&nbsp;<\/span><\/p>\n<p class=\"MsoNormal\"><span lang=\"EN-US\">How far can the Cuban economy go today in terms of raise wages to those working in state payrolls to thereby enable them to have better access to an increasingly more expensive market?<o p=\"\"><\/o><\/span><\/p>\n<p class=\"MsoNormal\"><span lang=\"EN-US\">&nbsp;<\/span><\/p>\n<p class=\"MsoNormal\"><span lang=\"EN-US\">We have often heard and read ideas and thoughts on how to solve this paramount problem, not only in terms of economic growth, but on the social effect it implies and on the very development of the socialist model Cuba is currently updating.<o p=\"\"><\/o><\/span><\/p>\n<p class=\"MsoNormal\"><span lang=\"EN-US\">&nbsp;<o p=\"\"><\/o><\/span><\/p>\n<p class=\"MsoNormal\"><span lang=\"EN-US\">People link the need for higher salaries, or better put, the improvement of solvency with the essential elimination of dual circulation of the currency and of the two markets that it creates.<o p=\"\"><\/o><\/span><\/p>\n<p class=\"MsoNormal\"><span lang=\"EN-US\">&nbsp;<\/span><\/p>\n<p class=\"MsoNormal\"><span lang=\"EN-US\">Other experts, and even prestigious academics, reiterate as their proposal the gradual decrease of the &ldquo;market&rdquo; exchange rate (Money Exchange-CADECA) between the Cuban peso and the convertible peso.<o p=\"\"><\/o><\/span><\/p>\n<p class=\"MsoNormal\"><span lang=\"EN-US\">&nbsp; <o p=\"\"><\/o><\/span><\/p>\n<p class=\"MsoNormal\"><span lang=\"EN-US\">The official currency appreciation will undoubtedly increase the solvency of the general population. Expert estimate that for each peso down in the rate purchasing power would have increased 4 percent.<o p=\"\"><\/o><\/span><\/p>\n<p class=\"MsoNormal\"><span lang=\"EN-US\">&nbsp;<o p=\"\"><\/o><\/span><\/p>\n<p class=\"MsoNormal\"><span lang=\"EN-US\">Such a decision would be supported by expenditure in foreign currency the country&#8217;s finances would support for the necessary import of goods to supply markets to meet the growing demand resulting from higher purchasing power.<o p=\"\"><\/o><\/span><\/p>\n<p class=\"MsoNormal\"><span lang=\"EN-US\">&nbsp;<\/span><\/p>\n<p class=\"MsoNormal\"><span lang=\"EN-US\">Having these resources available will mean to take them out of what the country accumulates as part of its economic performance, reduce the current level of investment, and increase personal consumption, but bear in mind the limited growth of the available resources.<o p=\"\"><\/o><\/span><\/p>\n<p class=\"MsoNormal\"><span lang=\"EN-US\">&nbsp;<\/span><\/p>\n<p class=\"MsoNormal\"><span lang=\"EN-US\">How far can we sacrifice the much needed investment for capitalization of the economy, thus compromising the future? Let&rsquo;s consider now the possibility that the Cuban economy has to realize this proposal. <o p=\"\"><\/o><\/span><\/p>\n<p class=\"MsoNormal\"><span lang=\"EN-US\">&nbsp;<\/span><\/p>\n<p class=\"MsoNormal\"><span lang=\"EN-US\">&nbsp;According to information gathered in the Statistical Yearbook of Cuba in 2010, published by the National Bureau of Statistics and Information (Onei), the amount of resources in the national economy for investments between 2005 and 2009 averaged 11.1 percent of all resources to distribute. Meanwhile, final consumption used 88.9 percent in the same period.<o p=\"\"><\/o><\/span><\/p>\n<p class=\"MsoNormal\"><span lang=\"EN-US\">&nbsp;<\/span><\/p>\n<p class=\"MsoNormal\"><span lang=\"EN-US\">It should be added that the actual final expenditure of households, reflecting the goods and services consumed by the inhabitants of the country, between 2005- and 2010 grew at an average annual rate of 7.8 percent.<o p=\"\"><\/o><\/span><\/p>\n<p class=\"MsoNormal\"><span lang=\"EN-US\">&nbsp;<\/span><\/p>\n<p class=\"MsoNormal\"><span lang=\"EN-US\">To take this route as a solution, the central coffers of the nation would have to spend additional currency to the currently planned, to be obtained either by an increase in exports or the substitution of imports.<o p=\"\"><\/o><\/span><\/p>\n<p class=\"MsoNormal\"><span lang=\"EN-US\">&nbsp;<\/span><\/p>\n<p class=\"MsoNormal\"><span lang=\"EN-US\">The short-term credit would not be the most convenient alternative because obviously it will increase debts which pose so many obstacles to foreign finances.<o p=\"\"><\/o><\/span><\/p>\n<p class=\"MsoNormal\"><span lang=\"EN-US\">&nbsp;<\/span><\/p>\n<p class=\"MsoNormal\"><span lang=\"EN-US\">It is worth recalling the crisis in the current account of the balance of payments in 2008 (latest data available in the Statistical Yearbook), with a negative balance of just over 2.3 billion dollars.<o p=\"\"><\/o><\/span><\/p>\n<p class=\"MsoNormal\"><span lang=\"EN-US\">&nbsp;<\/span><\/p>\n<p class=\"MsoNormal\"><span lang=\"EN-US\">This regardless of the external debt, which until that year was over 11.5 billion dollars, of which 25.5 percent was short term, therefore some of them are already due or payable in these years, which also competes with consumption and investment. <o p=\"\"><\/o><\/span><\/p>\n<p class=\"MsoNormal\"><span lang=\"EN-US\">&nbsp;<\/span><\/p>\n<p class=\"MsoNormal\"><span lang=\"EN-US\">&nbsp;<o p=\"\"><\/o><\/span><\/p>\n<p class=\"MsoNormal\"><span lang=\"EN-US\">Cuban President Raul Castro Ruz has reiterated the in almost every speech related to the economy a criterion: &quot;You cannot spend more than what you have&quot;, equivalent to a critic to the times when Cuba&rsquo;s consumption was based on borrowing.<o p=\"\"><\/o><\/span><\/p>\n<p class=\"MsoNormal\"><span lang=\"EN-US\">&nbsp;<\/span><\/p>\n<p class=\"MsoNormal\"><span lang=\"EN-US\">Rearranging the economy, with due flexibility and liberalization of the productive forces, must be the way-perhaps the only-to solve the serious problem of revenue for state workers and that they are consistent with the work they do.<o p=\"\"><\/o><\/span><\/p>\n<p class=\"MsoNormal\"><span lang=\"EN-US\">&nbsp;<\/span><\/p>\n","protected":false},"excerpt":{"rendered":"<p><span lang=\"EN-US\">The recurrent theme of wages and incomes in any analysis of the daily life of the Cuban people demands a deeper analysis on the complicated reality of what is necessary and possible: increasing wages and income must correspond to the growth in production.<o p=\"\"><\/o><\/span><\/p>\n<p class=\"MsoNormal\"><span lang=\"EN-US\">&nbsp;<\/span><\/p>\n","protected":false},"author":2173,"featured_media":5129,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"_acf_changed":false,"footnotes":""},"categories":[40,478],"tags":[],"ppma_author":[33650],"class_list":["post-2176","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-economy-business","category-reports"],"acf":[],"yoast_head":"<!-- This site is optimized with the Yoast SEO plugin v27.3 - https:\/\/yoast.com\/product\/yoast-seo-wordpress\/ -->\n<title>The inadequacies of wages and incomes in Cuba | OnCubaNews English<\/title>\n<meta name=\"robots\" content=\"index, follow, max-snippet:-1, max-image-preview:large, max-video-preview:-1\" \/>\n<link rel=\"canonical\" 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