Cuba opens the door to foreign investment in domestic trade

Cuba opens the door to foreign investment in domestic trade

Cuba plans to allow some foreign investment in local wholesale and retail trade for the first time since Fidel Castro’s 1959 revolution, the government said, in a bid to emerge from the worst economic crisis in decades.

Deputy Commerce Minister Ana Teresita González said late Monday on a television show that foreign investors would be allowed to own local wholesalers for the first time or enter the market through joint ventures.

Retail would be more restricted, but it also opened the door for some public/private companies in that space.

The reforms would allow foreign-owned entities to invest in warehousing and back-end logistics operations that supply state and private companies, for example, supporting the country’s effort to improve efficiency in a notoriously unproductive retail sector.

Gonzalez also said that Cuba would “selectively” allow some foreign investors to enter the retail market, as long as the investment contributes to the country’s socialist goals and cuts prices.

Domestic Trade Minister Betsy Díaz Velázquez said on the same talk show that the state would maintain its dominance in retail but would allow some public-private joint ventures.

“We are going to prioritize and offer these business proposals to companies that have remained in the country,” she said.

The moves come as Cuba struggles to redefine its state economy, after two years of pandemic-induced woes and sweeping US sanctions that have hampered recovery.

Cubans’ growing discontent over long lines for basic goods, fuel shortages and rolling blackouts have prompted Communist Party officials to speed up long-delayed plans to overhaul the Soviet-style state economy.

Both officials said Monday night that the goal was to put more raw materials and goods into the hands of the island’s producers and consumers, but economists and businessmen consulted by Reuters said the measures were likely to fall short.

“It’s a step in the right direction, but it’s too small and too late,” said Cuban economist Omar Everleny.

And he added that the measures were riddled with caveats and red tape.

“Both ads were full of words like ‘exceptions, control, conditions,’ as if they didn’t understand the seriousness of the crisis,” he noted.

Melissa Galbraith
Melissa Galbraith is the World News reporter for Globe Live Media. She covers all the major events happening around the World. From Europe to Americas, from Asia to Antarctica, Melissa covers it all. Never miss another Major World Event by bookmarking her author page right here.