Cuban Situation :: Cuba Politics Economy Economics Essays

Cuban SituationCuba needs cows. In January of 2004, a Cuban delegation visited Florida to inspect beef and dairy cows to patch Cubas languishing cattle industry. Moreover, under the auspices of the U.S. Trade Sanctions Reform and exporting Enhancement Act in 2000, the United States exported $350 million dollars worth of American agriculture products to its island neighbor in 2000 (Bussey 1). This budding trade relationship is diagnostic of a broader move by Cuba to fully re-insert itself in the global economy. deprive of the protective cocoon of Soviet trade agreements and faced with economic crisis and stagnation, Cubas leaders have responded with limited economic reforms. It is clear, however, that Cuba will not copy the rapid liberalization of much of Eastern Europe and Latin America. A brief review of Cubas economic performance since the fall of the Soviet Union reveals a trend of liberalization bred of necessity. Nevertheless, the mixed performance of the Export-Processing Zones and the giving medications grudging acceptance of tourism reveal a tensity between Cubas need for hostile currency and direct foreign investment and a desire to insulate and preserve Cubas existing domestic help apparatus. This tension underlies Cubas ongoing economic transition and has prevented in large quantities market liberalization. Cubas future movement towards market reforms will be carefully managed by the Castro government to protect Cubas revolutionary bequest and to maintain control of political opposition. The fall of the Soviet Union devastated the Cuban economy. Cubas GDP contracted by 35-50% from 1989-1993 (LeoGrande quest 5). As a percentage of total Cuban trade, the Soviet Unions plow fell from 66% in 1990 to 15% in 1994 (5). Moreover, Russia reneged on its anele agreement, and fitful exports caused energy shortages in Cuba. Production and consumption plummeted. From 1986-1991, Castro undertook a rectification campaign to stabilize the economy as th e Soviet Union reduced its support and eventually collapsed. The plan focused on re-centralizing economic readiness authority, dismantling the Soviet-sponsored socialist management system and market mechanisms, abolishing the free farmers markets launched in 1980, and combating degeneration (4). In addition, Castro tried to address the massive trade imbalance by reducing imports and reinvigorating the export sector. This program was a resounding failure. More domestic and far-reaching reforms were necessary to save the economy from crisis. Economic disaster had erected a life-threatening challenge to Cubas socialist program.In 1991, Castros announcement of a Special Period in a Time of Peace tag the beginning of Cubas new era of liberalization.