Sunday, August 8, 2010

Cuba's double currency

One unusual fact about Cuba which I had already heard about before going there, but whose significance I didn't realize before arriving, is that the country has two different currencies in use. There is the National Peso and the Convertible Peso. The Convertible Peso (CUC) used to be pegged to the same value as the US dollar, although it is nowadays slightly more valuable. The National Peso is exactly 25 times less valuable than the CUC. This system with two different currencies has basically created two parallel economies within the country. As I understand it, basic goods and services are bought using the national peso, while any luxury items can only be bought with CUC. Items sold in national pesos tend to be extremely cheap by Western standards, while items sold in CUC tend to have similar prices to what you might find in Europe. Basically, the CUC is the currency of the rich, and the national peso is the currency of the poor. Most ordinary Cubans are paid in the national peso, which means that a whole host of goods and services are off-limits to them. Foreign tourists generally only use the CUC during their stay. The result is that Cuba is not a particularly cheap country to travel around in for foreigners, since taxis, hotels and good restaurants have prices in CUC and are no cheaper than they would be in a Western country (although the service is not necessarily as good).

Personally I only used national pesos during the last two days of my stay, and that was only because I and the other foreigner I was with wanted to do things in Havana like taking public transport and going to the cinema, which require the national currency. Both services tunred out to be extremely cheap: the bus cost less than one peso (remember, 25 national pesos make up one dollar), and the cinema cost exactly one peso. When my friend went into a bank in Havana and said he wanted to exchange two CUC for national pesos (that being quite enough for all our needs), the bank clerk gave him quite a surprised look, since very few foreigners ever use the national currency.

The moment when I got a real inkling into what it is like to live in Cuba only using the national peso came when my friend and I went to Coppelia, a famous ice-cream parlour in the middle of Havana. There is a large hall where the ice-cream is sold in national pesos, and a stand outside where it is sold in CUC. On the first day we went to the CUC stand, where there was almost no queue and lots of different flavours, although the price was 1 CUC (in other words one dollar) for a scoop. The next day we went to the section where the prices are in the national peso. We had to wait one hour (literally) in a queue just to get in, since the place is extremely popular with Cubans and there are huge queues to enter the building. When we did finally manage to get in, we sat down in the hall and had to wait quite a while for a bad tempered waitress to come and serve us. When she did we found out that there were only two available flavours (and since one of them was chocolate which I don't eat, I had to settle for one flavour). Apparently, the two flavours vary from day to day. On the other hand, the ice-cream was extremely cheap, with about five scoops costing 5 pesos, or 20 cents.

Basically, when you pay in national pesos the service and the queuing times are reminiscent of the former Soviet Union, while if you pay in CUC you get Western standards and Western prices. Most Cubans' wages are in the national peso, and the average wage amounts to around 400-700 pesos a month. This would translate to only 17-30 CUC or dollars a month. That is why using the CUC is out of reach for many Cubans. It also gives you an idea of how precious tourists' tips are to Cubans. When I was staying in a resort in Playa Jibacoa, I gave a maid a 10 CUC tip to wash my clothes for me (admittedly it was a very large tip). She was extremely grateful and told me "esto me va a ayudar mucho" (this will help me a lot). Later on I realized that I had given her about half her monthly wage just to wash a few clothes.

Que linda es Cuba?

I am back from a two week journey to Cuba. The reason for my trip to Cuba was the fact that the World Esperanto Congress was held in Havana this year, and my parents were also taking part. As a result they invited me to come along and meet them in the Caribbean island, which is literally on the other side of the world from Beijing.

Cuba was certainly an interesting (as well as a relaxing) place to visit, and the contrast between Havana and Beijing couldn't have been greater. I am aware of the fact that two weeks is not nearly enough to come to grips with a country and what it means to live there. However, I have gathered some impressions of Cuba and I have learnt a bit about the country, and my knowledge of Spanish allowed me to chat to people everywhere I went.

My first impression of Havana, to be honest, was one of decay and stagnation. Even the center of the city is full of crumbling old buildings, decaying pavements and ancient US and Soviet cars which are miracolously still running, as well as some shiny new ones. The lack of shops and commercial activity is especially stunning coming from Beijing. Although I found one modern supermarket in Miramar, the fancy embassy neighbourhood, there is a general scarcity of shops and businesses and a total lack of the large shopping malls you can find in most capital cities of the developing world. What shops there are usually only allow purchases in convertible pesos and not in national pesos (more on the double currency system in the next entry).

What the city lacks in shops, it makes up for in political rethoric. The walls are full of posters and slogans invoking Che Guevara, the revolution, defending Cuba from US intereferences etc... (in the photo on top, you can see a mural of the Committees in Defense of the Revolution on a Havana wall, saying "More united and combative in defending socialism"). Immediately ouside the airport, big billboards inform you that one hour of US embargo deprives Cuba of enough electricity to generate I don't know how many power plants, and similar sorts of things. What I didn't notice in the streets are large images of Fidel Castro himself. Perhaps that would seem too dictatorial.

One of the causes embraced with most passion in Cuba seems to be the liberation of the five Cubans who were imprisoned in Florida in the nineties on espionage charges. The five were apparently investigating some of the anti-Cuban terrorist groups who operate in Florida, mainly among Cuban exiles. Some such groups have certainly been responsible for shameful acts of terrorism directed against Cuba, like the bombing of a civilian Cuban flight from Barbados to Jamaica in 1976 which killed 73 people, whose culprits now live happily in the US. These five Cubans are now national heroes, and all over Havana posters demanding the release of "the five heroes prisoners of the empire" are in evidence. The museum of the revolution dedicates a whole floor to them.

As I stayed in Havana, I found that Cubans tend to be laid back, friendly and sociable. If you can speak Spanish it is quite easy to get chatting to people, although in the center of the city you have to avoid the touts who constantly try and start up a conversation with tourists for easily imaginable hidden motives. The city certainly has its charm, especially the historic center with its old colonial houses (in the photo, a street in central Havana). It is also quite safe, unlike most Latin American capitals. The laid back atmosphere is so different from Beijing's mad rush that in the beginning I felt like everyone was moving in slow motion.

I have to say that I feel quite ambiguous about the country's social and political situation, as the Cubans themselves obviously do. On the one hand, it is true that Cuba lacks the terrible slums and extreme poverty which many Latin American countries display, including economic powerhouses like Brazil. Education and health services really are free and accessible for everyone, as the Cuban government loves to remind everyone. As a result, the UN's human development index, which is calculated on the basis of indicators such as illiteracy rates, average life expectancy and average income so as to give a composite picture of human well-being, ranks Cuba 51st out of the 182 countries listed, above most Latin American and third world countries.

This is all undeniable. At the same time, the island is no paradise for most of its people. All the Cubans I spoke to complained about how hard life is, with average wages simply insufficient to support themselves. Most Cubans apparently have to supplement their income in some way, with the lucky ones receiving money from relatives abroad or working in the tourist industry, while others have to take on a second trade or work in the black market. A taxi driver told me how he had a university degree in economics, but he became a taxi driver because it is more profitable to do a job like driving a taxi which involves tourists in some way than to get a proper professional job. Although I doubt that the average person leads an easier life in the neighbouring countries of Central America and the Caribbean, life in Cuba is also no joke.

Of course, the strict US blockade certainly plays a big role in Cuba's troubles and economic stagnation, with the United States effectively making it very difficult even for European companies to trade with Cuba. Then again, the United States are simply unable to accept the idea that a Latin American country might slip out of their control, and their anti-Cuban extremism knows no bounds. It is illegal for US citizens to even visit Cuba (actually, in a typical twist, it is technically illegal only for them to spend money there, not to go there). Ones who do visit have to pass through Mexico or Canada. If they are found out, they have to pay a huge fine. A young man from California came to the esperanto congress in Cuba via Mexico. Before leaving Cuba, he made sure to throw out of his bag anything which might prove he had visited the place.

Another striking fact about Cuba is the extremely limited spread of the internet, which in 2010 is truly surprising. Good hotels in Havana usually have a few computers in the lobby which can be used to access the internet, but the service is slow and expensive, costing about 6 dollars an hour. The vast majority of Cubans apparently don't have an internet connection at home, and neither do they have other opportunities to access the internet. I never saw an internet cafe' in Cuba. I have read that some exist, but they are few and the price is far too high for ordinary Cubans. A young Cuban esperantists who wanted to correspond with me actually asked me for my postal addres, since he didn't have an e-mail. Another one gave me his cousin's e-mail, since he has the opportunity to get online through his university.

As always, the Cuban government blames the US embargo for forcing them to make use of a more expensive and slow satellite connection because they can't connect to the US's internet cables which they would otherwise do. Others blame the government itself for not wanting ordinary Cubans to have access to the internet. I don't have the technical expertise and knowledge to assess these claims, but the basic situation is that Cuba is essentialy an offline society. There is talk of Venezuela, Cuba's new oil-rich ally, helping the country aquire a better internet connection, but up to date this has not happened (in the last photo, young people gathered in a cultural center in Havana).