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New York Times: Cuban economy in a dilemma

Last Updated on Monday, 15 December 2014, 22:39 by GxMedia

New York, Dec 15 (EFE).- The New York Times said Monday in an editorial that the Cuban economy is in a dilemma and facing the need to push economic reforms but having to deal with the resistance of the “old guard” and the danger that Havana could lose subsidies from Venezuela.

The daily, in an editorial in its digital edition, provided also in Spanish, noted that Venezuela provides “heavily subsidized oil” to Cuba in exchange for medical services.

But the Venezuelan government “has struggled with a worsening economic and political crisis, which could force it to cut off subsidies to Havana.”

Venezuela is one of the oil producers that has been most affected by the recent plunge in the price of petroleum, to around $60 per barrel, which puts its economy in a very tight spot given that it is very much dependent on oil exports.

The “precariousness” of the relationship between Cuba and Venezuela “has added urgency to the debate over how fast the Cuban government needs to implement the reforms Raul Castro endorsed” starting in 2008, when he assumed power from his ill brother Fidel.

“The pace has been halting, with plenty of backtracking from the government’s old guard, which views further liberalization of the economy as an abdication of the socialist system Fidel Castro made sacrosanct,” the editorial adds.

While the old guard believes the economic liberalization would put social equality at risk, the reformers, “including some of the country’s leading economists, say the current state of the economy is untenable.”

The newspaper points to the possibility that the United States could help “help expand the role of Cuba’s small but growing entrepreneurial class by relaxing sanctions through executive authority and working with the growing number of lawmakers who want to expand business with Cuba.”

“Washington could empower the reformist camp by making it easier for Cuban entrepreneurs to get external financing and business training,” said the Times.

“That type of engagement is unlikely to succeed unless the United States abandons its policy of regime change. Cuba’s economic transformation may be proceeding slowly, but it could well lead to a more open society,” the paper adds.

For now, “continued antagonism from Washington is only helping the old guard,” the Times concludes.