Summary of the28th Annual Conference of the Association for the Study of the Cuban Economy (ASCE)
The 28th Annual Conference of the Association for the Study of the Cuban Economy (ASCE), held in Miami, FL, was slightly different from prior meetings. As in recent meetings, an increasing amount of Cuban-based economists and students attended; indeed the two student essay prizes were won by students living in Cuba. The papers presented, and there were many good ones, seemed to sum up the disastrous state of the Cuban economy, its very poor prospects, and then fatalistically concluded there would be little or no light at the end of the tunnel. There was little preaching or suggested reforms; virtually no participant expected further significant political or economic reforms or an economic recovery. Short of finding a new Sugar Daddy like the USSR or Venezuela, one would have to conclude Cuba runs a high risk of becoming a failed state.
The present situation. Cuba claims its real GDP grew by about 2 percent last year, but there are strong reasons (see below) to doubt this, and little to expect growth this year. The fiscal deficit seems unsustainable, real salaries remain well below those of the late 1980's--i.e., before Soviet aid ended--and investment remains at just over one tenth of GDP. The steady net disinvestment in many areas--transport, energy, and water/sewerage infrastructure, let alone housing (the deficit is now estimated at over 880,000 units)--continues. Some indices for this year show a distinct decline. Tourist arrivals are down the first half of 2018, and the sugar harvest (which runs from about December to April) produced virtually a record low of only 1.1 million tons of sugar. One of Cuba's best economists noted a continued rigidity of the bureaucracy, reversal of some reforms, and a drop in the expectations of younger Cubans.
Some of the recent reforms--freer international travel and house/car sales--seem to have worked; some such as "cuenta propista" (informal, but semi-legal family enterprises) workers and agricultural liberalization have been reversed; and some have either failed--such as the sugar rationalization--or after much talk (currency unification)have never been undertaken. The emigration of so many skilled and experienced workers has had some effect on the quality of teachers, the capacity of government, and the general productivity of the economy. A variety of recent estimates of Cuba's GDP seem to show recent per capita incomes may be either similar to those of 1959, when Fidel first took office, or at most had 1 percent annual growth over the period. Cuba, once ranked in per capita income equal to Spain, Italy, or Argentina, now is about equal to some of the poorest Central American countries. Surveys show those Cubans born after 1990 now have little hope of an economic recovery; many want to leave Cuba.
Some details. Pre-Castro, Cuba was the world's largest exporter of sugar. Indeed, during the 1950s Cuban governments' main concern was to keep the sugar harvest down, usually below 7 million tons, since after filling its US quota, too large an excess export amount could depress the world market price.Add a comment Leer más...