Cuba opens up its economy to private businesses

Cuba opens up its economy to private businesses
Many private businesses work in Cuba's tourist industry which has been hit hard by the pandemic. Source: Getty Images
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Daily US Times: Cuba has announced that it will allow private businesses to operate in most industries of the country, in what is a major reform to its state-controlled economy.

Cuban Labour Minister Marta Elena Feito said the list of authorised industries had expanded from 127 to more than 2,000.

She said only a minority of industries would be reserved for the state.

The communist country’s economy has been hit hard by the coronavirus pandemic and US sanctions introduced by the Trump administration.

Last year Cuba’s economy shrank by 11% – its worst decline in almost three decades – and Cubans have been facing shortages of basic goods.

Ms Feito said just 124 industries would be exempt from private involvement although she didn’t mention which ones.

Ms Feito was quoted by AFP as saying: “That private work continues to develop, is the objective of this reform.”

She stressing that the decision “will help free the productive forces” of the private sector.

Experts on Cuba’s tangled and complicated economy say the step essentially opens up almost all economic activity on the island to some form of private enterprise, the BBC’s Will Grant in Havana says.

This will be a significant shot in the arm for those individuals and families who harbour hopes of moving beyond just the very small businesses into medium-sized ventures, he notes.

Apart from hundreds of thousands of small farms, the non-state sector of Cuba is composed mainly of small private businesses run by artisans, taxi drivers and tradesmen. Around 600,000 people, around 13% of the workforce, joined the private sector when the opportunity arose.

However a large number of private businesses are involved in the Cuban tourist industry, which has been hard hit by the pandemic and sanctions.

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