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AFTER several years of promising to do so, the Cuban Government has finalised reforms begun when former President Raul Castro took over from his brother, Fidel, in 2008 — making it, possible for small and medium-size companies to operate above the radar.
The reforms were originally presented in a 32-page document detailing the party’s plan for economic development, and approved by Congress in 2016 when the nation was hopeful of better relations with the US.
Several changes have occurred under pandemic conditions, said to be due to July’s protests when thousands turned out to complain of economic conditions.
In that month, the authorities said they would allow travellers arriving in the country to bring in food, medicine and other essentials without paying import duties.
On September 20, 2021 news networks reported that the island’s Government has put into effect the legal framework that for the first time legalises small and medium-sized enterprises on the island starting this past Monday.
Under the new rules, enterprises with up to 100 employees will be allowed, with President Miguel Daz-Canel stating that Cuba was taking firm steps to update its economic model.
With this change, entrepreneurs in the Caribbean nation initiated the application process either online or by attending offices set up by the Government across the country’s over 160 municipalities.
Some analysts say the new status is a sign of the Government’s recognition that private enterprises will have a significant role in the future, although the main means of production could remain in the hands of the State.
The Government has sold the idea that new companies can help the state of the economy and improve connections between State and non-State sectors.
Small businesses expect as well that formalisation will position them to receive donations from international companies and import raw materials.
Legalisation will also aid access to funding from lenders.
It is estimated that the number of self-employed persons in the Caribbean nation is around 600,000.
The Cuban Ministry of Labor and Social Security indicates that small and medium-sized enterprises will only be restricted to operate in education, public health, defense, garbage management, mining and other defined segments.
However, local entrepreneurs on the island are now encouraged to export through State-operated enterprises.
It was reported that on Monday when the Platform of Economic Actors came into force it received 75 applications for micro, small and medium-size enterprises as well as non-agriculture cooperatives.
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