Monday, August 11, 2008

Cubans see economic reforms as symbolic

Mon 11 Aug 2008

By Jeff Franks

HAVANA (Reuters) - President Raul Castro came into office with a flurry of economic reforms but many Cubans say their value has been more symbolic than real so far. Changes by Castro, who replaced his ailing older brother Fidel Castro in February after a vote of the National Assembly, have included allowing Cubans to buy cell phones and computers for the first time and stay in hotels that were previously off-limits. Cubans interviewed by Reuters said they are happy to have their new rights, but most have a problem -- they do not have money to pay for them. Computer sales have been limited by price and availability, cell phone vendors were initially confronted by long lines of customers but that has already tapered off, and hotel managers say the number of Cuban guests has not been significant.

"Really, they make things better," a 26-year-old student called David said of the reforms as he came out empty-handed from a Havana store that sells computers. But "for me the sale of computers isn't an improvement if you don't have the money to buy," he said, not wanting to give his full name. "The prices are abusive." Lack of money is a frequent complaint in socialist Cuba where people get social benefits at little or no cost, but the average person earns less than $20 a month.

Computers, assembled in Cuba from Chinese parts, sell for between $750 (390 pounds) and $1,600. A clerk at one of Havana's most popular shopping centers said they had sold 200 computers since they went on sale on May 2, but now had none in stock and did not know when more would come in. At another store, the manager said they had sold about 30 computers, and had only the most expensive computers still available. He also did not know when he would get more. "There is demand, but it's for the cheaper units," he said.


Cubans lined up to buy cell phones when they went on sale in April, and in the first three weeks, Cuban officials said 7,400 lines were sold. That number has since dropped to about 300 a week, a phone company official said. Cuba, with a population of 11 million, had 330,000 cell phone lines in use in 2007, according to a recent report by the National Statistics Office. By comparison, nearby Mexico has 50 million cell phone users, close to half its population.

Cuban cell phone service, including the line and phone, costs a minimum of about $200 to start, then 39 cents to 50 cents a minute to use. "Maybe some day, but right now I couldn't pay for that in my dreams. I make 300 pesos (7.50 pounds) a month," said a construction worker who did not want to give his name. On a recent day in the beach resort of Varadero, 90 miles (145 km) east of Havana, vacationing Cubans floated in the azure waters, but all interviewed said they were there on government incentive programs for productive workers.

The plans allow them to stay in nice hotels at drastically reduced prices - 1 peso for every 24 paid by tourists -- or for free. They said money was not an issue and praised the pace of reforms. "You make an opening and you go gathering the fruit little by little. You can't make the changes totally, one after another," said Aurelio Gonzales Sanchez, while sunning in a beach chair.

A tourism industry manager who asked not to be identified said "there are not big numbers" of Cubans staying in the tourist hotels apart from those on the government program. Castro has made other reforms that touch the people less immediately but have potentially broader impact, particularly in agriculture where private farmers and cooperatives are getting more land to raise food production. Other changes appear to be afoot.

Last week, a government-owned home-and-hardware store opened in central Havana that, with its well-stocked shelves and varied merchandise, looks like a chain store from the United States or Mexico. Accustomed to more spartan commercial establishments, Cubans waited in long lines to enter and once inside walked about with looks of wonderment at both the plentiful selection and the sky-high prices. For a few moments, said 70-year-old pensioner Clara Consuegra, the store gave her new hope for her country. "When you're inside the store you think something is changing in Cuba," she said. "But when you go out to the street you see that everything is the same."

(Additional reporting by Rosa Tania Valdes and Esteban Israel; editing by Michael Christie and Kieran Murray)

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