Cuba heading away from economic crisis
Friday Dec 23 07:13 AEDT
Cuban President Fidel Castro said on Thursday the economy grew a spectacular 11.8 per cent this year based on a locally devised formula, after 15 years of hard times that began with the collapse of the Soviet Union.
"We grew 11.8 per cent, but I think we grew 12 per cent and we expect 10 per cent in 2006," Castro said as a year-end session of parliament opened to review the country's economic situation.
Cuba reported 5 per cent growth in 2004.
The increase was calculated using a new formula that estimated the market value of free social services and subsidised goods and services to Cubans and included massive medical and other services exported mainly to Venezuela.
The UN Economic Commission for Latin America (ECLAC) and the Caribbean said this month it was omitting Cuba from statistical comparisons this year and next while it evaluated the new method which differs from the international standard.
Cuba was plunged into a deep crisis when the Soviet Union collapsed, depriving it of massive subsidies and markets and resulting in shortages of food, energy, transportation and capital.
Since then the import-dependent Communist nation has moved away from sugar as its main export, with tourism, medical services, nickel, family remittances and pharmaceuticals now accounting for most of its foreign exchange earnings.
Cuba began bartering medical and other services for 90,000 bpd of Venezuelan oil this year and the South American country also began paying Cuba for additional medical and other services, for a total value estimated at close to $3 billion by local economists.
"The biggest change is that Venezuela began this year paying for 25,000 doctors working there, 8,000 sports trainers and others, and for more than 150,000 eye operations carried out in Cuba," said a foreign banker based in Havana.
"That is $3 billion odd of new revenues over a total gross domestic product of 35 billion, or 8,5 per cent of the increase," he said.
China is supplying the Caribbean island with hundreds of millions of dollars of soft trade and development credits the government has announced, neutralising recent US measures to tighten further a decades-old trade embargo.
"The country has begun to overcome the shortages of the crisis," Economy and Planning Minister Jose Luis Rodriguez said in a report to deputies long on optimism but short on figures.
Cuba did raise wages and pensions some 25 per cent this year and began offering to the population Chinese appliances at cost. ECLAC reported just a 4 per cent inflation rate.
Cuba's economy is more than 90 per cent in state hands with most of the population employed by the government.
Rodriguez said imports increased 36.4 per cent or more than $2 billion over $5.6 billion reported in 2004, while the export of goods and services were up 27.9 per cent or 1.6 billion over the 5.9 billion ECLAC reported in 2004.
Rodriguez provided no further information to calculate the current account balance of payments, reported by the Central Bank as a $120 million surplus last year.
Various officials have said the surplus increased this year, without providing details.
Rodriguez for the first time in years gave little sectoral data and said nothing about Cuba's foreign debt, which the government said was $13.8 billion in 2004.
©AAP 2005
Friday Dec 23 07:13 AEDT
Cuban President Fidel Castro said on Thursday the economy grew a spectacular 11.8 per cent this year based on a locally devised formula, after 15 years of hard times that began with the collapse of the Soviet Union.
"We grew 11.8 per cent, but I think we grew 12 per cent and we expect 10 per cent in 2006," Castro said as a year-end session of parliament opened to review the country's economic situation.
Cuba reported 5 per cent growth in 2004.
The increase was calculated using a new formula that estimated the market value of free social services and subsidised goods and services to Cubans and included massive medical and other services exported mainly to Venezuela.
The UN Economic Commission for Latin America (ECLAC) and the Caribbean said this month it was omitting Cuba from statistical comparisons this year and next while it evaluated the new method which differs from the international standard.
Cuba was plunged into a deep crisis when the Soviet Union collapsed, depriving it of massive subsidies and markets and resulting in shortages of food, energy, transportation and capital.
Since then the import-dependent Communist nation has moved away from sugar as its main export, with tourism, medical services, nickel, family remittances and pharmaceuticals now accounting for most of its foreign exchange earnings.
Cuba began bartering medical and other services for 90,000 bpd of Venezuelan oil this year and the South American country also began paying Cuba for additional medical and other services, for a total value estimated at close to $3 billion by local economists.
"The biggest change is that Venezuela began this year paying for 25,000 doctors working there, 8,000 sports trainers and others, and for more than 150,000 eye operations carried out in Cuba," said a foreign banker based in Havana.
"That is $3 billion odd of new revenues over a total gross domestic product of 35 billion, or 8,5 per cent of the increase," he said.
China is supplying the Caribbean island with hundreds of millions of dollars of soft trade and development credits the government has announced, neutralising recent US measures to tighten further a decades-old trade embargo.
"The country has begun to overcome the shortages of the crisis," Economy and Planning Minister Jose Luis Rodriguez said in a report to deputies long on optimism but short on figures.
Cuba did raise wages and pensions some 25 per cent this year and began offering to the population Chinese appliances at cost. ECLAC reported just a 4 per cent inflation rate.
Cuba's economy is more than 90 per cent in state hands with most of the population employed by the government.
Rodriguez said imports increased 36.4 per cent or more than $2 billion over $5.6 billion reported in 2004, while the export of goods and services were up 27.9 per cent or 1.6 billion over the 5.9 billion ECLAC reported in 2004.
Rodriguez provided no further information to calculate the current account balance of payments, reported by the Central Bank as a $120 million surplus last year.
Various officials have said the surplus increased this year, without providing details.
Rodriguez for the first time in years gave little sectoral data and said nothing about Cuba's foreign debt, which the government said was $13.8 billion in 2004.
©AAP 2005
