Cuba Shaken by Rumors of Currency Unification

Cuba Shaken by Rumors of Currency Unification / Orlando Freire Santana
Posted on November 7, 2013

HAVANA, Cuba, October, www.cubanet.org — The official announcement in
the newspaper Granma this Tuesday, October 2, with its timeline for
instituting the changes regarding currency unification, unleashed a
torrent of rumors, which some say circulate faster that news from the
Communist Party.

But there wasn't much to it. There was no change of any importance in
the value of the two currencies. Stressed-out Cubans, who must rely on
an average monthly salary of some 445 CUP (or Cuban pesos), will still
have a "rope around their necks," worrying about how to pay for goods
priced in CUC (or convertible pesos) at the fixed exchange rate of 1 CUC
to 25 CUP. Given the sensitive nature of this topic, however, it was
inevitable that contradictory analyses would start cropping up first
thing Tuesday morning.

Almost everyone believed that there would be a gradual strengthening of
the Cuban peso until the two currencies reached parity and the CUC was
finally phased out. In the opinion of some, the rate of exchange could
be around 1 CUC to 20 CUP within a few months.

A neighbor in my building, who subscribes to this line of reasoning,
noted that this could create pressure on the currency exchange bureaus
(CADECAS) if people tried to gradually get rid of their CUCs, especially
now that the rate of exchange is still at 1 CUC to 25 CUP.

A diametrically opposite point of view was expressed by a self-employed
worker as he was preparing to begin his day. He believed it might be a
trap by the government to collect the money in circulation and deal a
fatal blow to the new "potted plants.*" According to this worker, a
third currency would be created and this would be the one to survive.
All Cuban pesos and CUCs would have to be exchanged for it but there
would be a maximum amount that could be exchanged. Anything exceeding
that figure would represent a loss to its owners. It would be a kind of
punishment for those who sold their homes at astronomic prices in hopes
of leaving the country.

Twenty-four hours after the release of the official announcement I
decided, one way or another, to gauge the public mood by visiting
various CADECAS around the capital. There seemed to be a prevailing calm
and the lines of customers were no longer than usual at the entrances to
currency exchanges in the Focsa building — located at 23rd street in
front of Copelia — and at the National Bus Terminal. I joined a line of
customers at the latter to exchange some money so that I could make
inquiries with the cashiers.

The two or three people with whom I was able to speak did not completely
understand the announcement which appeared in Granma, though I did
detect a certain level of anxiety about what could happen. One of the
people in line with me, an older gentleman, did not hide his mistrust of
the authorities and recalled what happened with the currency change in
the 1960s when people lost a substantial part of their savings. For her
part, the cashier who waited on me acknowledged that on Tuesday morning
people were asking for Cuban pesos with some insistence. However, by
Wednesday — the day of my visit — demand was back to normal.

After chatting with some of my colleagues, an interesting point of view
emerged. It was felt that this could be a public relations maneuver on
the part of the government to calm the many gullible people who believe
that, with the end of the dual currency system, the country's economic
problems will be solved. The Party Guidelines indicate that officials
contemplated currency unification but they now know neither when nor how
to properly pull it off. At least the published timeline shows they are
giving themselves a little more time.

Orlando Freire Santana

*Translator's note: Cuban slang for the nouveau riche.

Cubanet, October 25, 2013

Source: "Cuba Shaken by Rumors of Currency Unification / Orlando Freire
Santana | Translating Cuba" -
http://translatingcuba.com/cuba-shaken-by-rumors-of-currency-unification-orlando-freire-santana-hemosoido/