Category Archives: Cuba

The Technology Boom and Latin America

 

2015 Paper Reveals Important Insights into Cuban Economy

Jorge Dominguez
Image: people.fas.harvard.edu

A former professor at Harvard University, Jorge Dominguez achieved the distinction of becoming the institution’s first vice provost for international affairs before retiring in 2018. With a focus on Latin American politics, Jorge Dominguez regularly shared his insights in newspaper and magazine articles, including the paper “What You Might not Know About the Cuban Economy,” published in the Harvard Business Review.

The article furnished a comprehensive look at the history of the Cuban economy, backed up by statistics to help readers understand how the country may develop following the restoration of Cuban-U.S. ties in 2014. For instance, it highlighted the fact that the country’s gross domestic product per capita in 1985 was approximately the same as in 2015. Further, the Cuban economy hadn’t effectively recovered since the 2008-2009 financial crisis, and, at the time of the article’s publication, the annual growth rate had the potential to be close to zero.

One of the positive aspects of the Cuban economy the article focused on was the country’s sustained investment in human capital. Individuals in the Cuban workforce are well-educated and furnished inexpensive services, and these assets could be enhanced through smart investment and government legislation.

The Cuban Economy in a New Era

Recently retired Harvard University professor Jorge Dominguez taught at the school from 1972 to 2018. Over the course of his career, Jorge Dominguez has authored and edited a wide range of books and articles on political science and international affairs. One of Dr. Dominguez’ most recent projects was co-editing The Cuban Economy in a New Era.

Subtitled “An Agenda for Change toward Durable Development,” the book features contributions from leading Cuban economists who have been collaborating with Harvard scholars for more than a decade. The Harvard University David Rockefeller Center for Latin American Studies published the book in 2017 for distribution through the Harvard University Press.

The Cuban Economy in a New Era begins by examining a range of challenges within the Cuban economic system, including its bankrupt sugar industry and dilapidated public infrastructure. The book then outlines possible solutions to Cuba’s economic woes in areas that include macroeconomic policy, central planning, state enterprise management, and partnerships with global financial institutions.

New U.S. Policies Target Cuban Socialism While Hurting Entrepreneurs

Jorge Dominguez
Image: people.fas.harvard.edu

As a Harvard University professor emeritus, Jorge I. Dominguez, PhD, brought focus to Latin American politics while expanding the institution’s presence in international affairs. One of Dr. Jorge Dominguez’s areas of focus was on developing a fuller understanding of, and explicating, the complex social and economic underpinnings of Cuba’s oft-dysfunctional communist government.

A recent article in Quartz brought attention to recent moves by the Trump administration to restrict movement of people and cash between Cuba and the United States. The new policies announced by National Security Advisor John Bolton include severely restricting U.S. travel to Cuba and limiting the amount of money Cuban Americans can send to family members in Cuba to $1,000 per three-month period.

Many of the existing sources of hard currency revenue and capital are in tourist sectors such as hotels, restaurants, tours, and travel guides. With Cuba at high risk of losing Venezuela as an oil-backed economic patron, food and fuel shortages are an increasing concern, and continuing economic stagnation looms large.

Unfortunately, the effect of the new U.S. policies will be most impactful against a nascent community of entrepreneurs who have responded to economic liberalization in recent years. The post-Castro government is one that has weathered six decades of crippling embargoes and knows about subsistence survival.

Travel restrictions are likely to prevent the emergence of an alternative to “stagnant state-owned enterprises.” Additionally, by pushing Cuba away, the U.S. will effectively incentivize the communist country to forge stronger ties with China and Russia.

Raul Castro Gives Speech at Communist Cuba’s 60-Year Celebration

 

Jorge Dominguez
Image: people.fas.harvard.edu

Former Harvard University professor Jorge Dominguez served as the chair of the Harvard Academy for International and Area Studies. Over the course of his academic career, Dr. Jorge Dominguez authored several publications on Cuba, its communist politics, and its relations with the United States.

On January 1, 2019, Cuba celebrated the 60th anniversary of the communist revolution spearheaded by the late former president Fidel Castro. In commemoration, 87-year-old Raul Castro, the brother of Fidel and the first secretary of the ruling Communist Party, delivered an address to the Cuban people and the world in which he reiterated Cuba’s openness to diplomatic engagement while criticizing the resurgence of confrontation by Washington. He particularly cited the current US administration’s dissemination of “falsehoods” to discredit Cuba and blame it for various ills in the region.

Dressed in full military attire, Raul Castro highlighted how, over the 60 years, Cuba had shown that it would not be cowed by threats. He followed by reiterating the island nation’s commitment to peaceful co-existence and its openness to economically beneficial trade. The widely publicized address was given at Santiago de Cuba, the burial site of Fidel Castro.

The State of US-Cuba Relations

A former Harvard professor focused on Latin American studies, Jorge Dominguez has published several books that explore Cuba’s political and economic landscapes. On June 27, 2017, Jorge Dominguez published an op-ed in the New York Times that discussed America’s relations with Cuba in the aftermath of Donald Trump’s June 16 speech in Miami in which he announced the cancellation of former President Obama’s deals with Cuba.

As of the date of publication of the op-ed, many of the previous US administration’s policies toward Cuba were still in effect, despite Trump’s assertions that he had canceled all deals made between former President Obama and Cuba. In fact, Trump had even ratified some of those policies, including military cooperation between the two states along Guantanamo’s perimeter, air and sea collaboration against drug trafficking, and security cooperation to halt undocumented migration. On the economic front, the United States’ commercial flights to Cuba were still in operation, and agricultural exports to Cuba were still flowing, as were financial remittances from the US to Cuba.

The reason for this? According to the US Treasury, the changes announced by Trump could take effect only when new regulations were issued. The White House later said that the issuance of new regulations could take months, which ensured that the status quo remains. As it stands, Trump’s reluctance to reopen bilateral negotiations and political debate over US-Cuba policy, despite his strong rhetoric, implies an openness to maintaining US-Cuba relations as they are.

Cuba – Challenges, Despite Unofficial Opening of Some Restrictions

Jorge Dominguez
Image: people.fas.harvard.edu

Most recently serving as Harvard University’s Department of Government Antonio Madero Professor for the Study of Mexico, emeritus, Jorge Dominguez focused on Latin America. Jorge Dominguez recently edited The Cuban Economy in a New Era: An Agenda for Change Toward Durable Development and was interviewed in-depth by Readara on the subject.

With Cuba under president Miguel Diaz-Canel having made moves to increase foreign direct investment (FDI) and authorize private businesses in some areas of the economy, there are still major challenges. Beyond the inherent inefficiencies of most of Cuba’s state run sectors, there are no officially sanctioned wholesale markets or international supply chains for imported products, which would allow critical supplies to be accessed at competitive prices.

As Professor Dominguez describes it, ordinary people must do “crazy and illegal stuff” to access needed supplies. The government on some level recognizes the necessity of this, as tourism is a positive area in the Cuban economy that would be hurt if those entrepreneurs who do access supplies illegally were shut down.

If the system whereby private restaurants are allowed to operate within the law was extended to other parts of the Cuban economy “it would make a great deal of sense.” Unfortunately, there is a lingering fear among the leadership that things might get out of control and their primacy would be threatened by U.S. government pressure.