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Posted March 16, 2010 by publisher in Business In Cuba

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Rob Sequin | Havana Journal

State run newspaper Granma reported that Cuba will close at least one hundred “inefficient” government run farms and move approximately 40,000 government workers to other jobs.

Agriculture Minister Ulises Rosales made the announcement at a meeting of the National Association of Small Farmers in Santa Clara Villa Clara.

He claimed that the farms are unsustainable in the current economy.

Cuba imports about eighty percent of the food consumed by its eleven million people at an annual cost of several billion dollars.

The government run newspaper stated that the farms cannot be maintained due to the lack of financial liquidity “brought on by the international financial crisis, the drop in foreign trade, the continuing U.S. economic embargo” and other factors.

Cuba reported an increase in 2009 of beans, potatoes and onions but decreased in bananas and corns compared to 2008.

—————————————- Havana Journal Comments—————————————-

Closing 100 farms? Seriously? Cuba’s Communist government can’t even get farming right in Cuba after 50 years. Shameful really.

Relocating 40,000 workers? Yeah right. The government is going to pay to train farmers to do what, be doctors? Good luck.

Cuba imports 80% of its food? 80%! EIGHTY PERCENT? You put a seed in the ground and it grows. Humans have been farming for something like a million years. Only Castro’s Communism could screw that up. Now that they are closing more farms, are they trying to get the number up to 100%?

The Embargo? Please.

If Castro let people grow their own food on their own land and were allowed to sell the food, Cuba would be doing just fine but the Castro have to have their hand in, or should I say hand ON everything just keep to the Cuban people poor and hungry.

Nice job Fidel and Raul. The Revolution is a great success.

  1. Follow up post #1 added on March 16, 2010 by gallofino with 20 total posts

    Although Cuba is indeed in dire straits with its farming, this is nothing new inside or outside Cuba.  If we point to Cuba’s neighbor to the south, Jamaica, wilt all the “help” from IMF and World Bank and a very open and robust marketplace, we will see evidence of massive imports of food that could easily be produced nationally and at the expense of local farmers.

    Cuba’s farming may be a train wreck right now, and the restrictions, despite being lifted somewhat still make it a perilous endeavor.  Add to that a history of unfulfilled promises of seed, fertilizer, tractors, fuel and spare parts for such necessities as irrigation pumps and other essential tools and the picture is pretty bleak.

    However, I have personally seen evidence of a turnaround in this sector.  It will not cure itself and even with a massive, sustained effort it will come around slowly.  What Cuba has to do in this regard is support its private farmers without breaking promises or the ever-looming threat of taking their lands away (unless they are really unproductive as some are and remedies are in place for that).  It has happened before and the prevailing fear amongst farmers is that is will happen again.  Most of the available lands are overrun with Marabu, an invasive thistle bush that covers the idle lands.  When cows eat their berries and drop pies filled with fertilized seed, they say one single cow can ruin 10 acres in a year.  To remove the deep-rooting Marabu is very laborious, requires bulldozers (rare), a spot to manufacture charcoal, and up to three years after clearing before the land can be successfully planted.  No one wants to risk all this work to have the state take back the properties because the owner does not have a receipt for his horse feed or his cellphone. 

    Moreover, the only reason the US is the largest exporter of food to Cuba is that it provides the cheapest food.  Ask Jamaica.  Essentially, Cuba has fallen into the trap of cheap (subsidized) farm goods from the US without ever taking a loan from the WB or IMF.  The effect though has been similar as it has depressed prices of food produced in Cuba.  To point to the CUC stores and the expensive food products there does not tell the whole story.  The very robust and steadfast (despite so many operativos to stamp it out) black or gray market is another source of great competition to the Cuban farmer. 

    Having toured various farming cooperatives in Cuba, it is clear that most are dysfunctional at best.  It is just as possible for a trailer to sit idle for two years because they cannot get an inner tube as it is for the massive loss of crops because of a broken water pump.  The blame for these inefficiencies are invariably shot up the ladder to the people in Havana.  They may belong there too.  Likewise, some of the blame is at the source.

    However, there is hope.  It all has to do with attitude and ignoring the past insults.  Right now Cuba needs productive farmers more than ever and there is evidence that the call is being answered in the private sector as never before.  Productive farmers are seeing unprecedented earnings and this is proving infectious.  Imagine a cooperative farmer that averaged CUC$7.00 per month until two years ago that can now see over CUC$100.00 for 2,000 heads of garlic and the same for 1,000 cobs of corn. 

    As much fun as it may be for some to take pot shots at the state over the dismal agricultural figures so far, it has to be understood that this initiative and indeed the people’s confidence in it will take years to come around.  The ‘08 Hurricane season certainly didn’t help either.

  2. Follow up post #2 added on March 16, 2010 by jmw1 with 62 total posts

    Somebody, please let the world know if an “efficient” government run farm ever existed in a Communist dictatorship?

  3. Follow up post #3 added on March 16, 2010 by publisher with 3905 total posts

    “It is just as possible for a trailer to sit idle for two years because they cannot get an inner tube as it is for the massive loss of crops because of a broken water pump.”

    I think China makes inner tubes and water pumps. They are giving free buses and trains to Cuba. If the Cuban government wanted farmers to grow food, the country would be FILLED with Chinese made tractors and farm equipment. FILLED!

    I think the Chinese know a thing or two about farming but obviously the Cuban government does NOT want the Cuban people to be successful farmers.

    Cuba consulting services

  4. Follow up post #4 added on March 17, 2010 by pipefitter with 275 total posts

    There are quite a few problems that contribute to this stupidity in the procurement of goods in Cuba. There are too many people to go through to actually get the parts. The people ordering the parts don’t know what the parts are etc. The best way would be for the co=op to order it directly, but they would need the dollars, the internet and some people working there that actually give a shit. The co-op’s schould be run with more independance and the people working there having a financial interest and control in the running of it. There is nothing like having people with some financial interest and control in a farms direction to get them to produce more and be more efficient. I read a piece the other day about a farmer near Holguin who is an independant or private farmer. He has 48 milk cows that he looks after like his own kids, he employs 8 people, he produces 500 ltrs of milk a day (sells all of it to the state at 0.40/ltr) has his own acreage planted with sugar cane and yuca that he feeds to his cows as a supplement when there isn’t enough grass or rain/water. He has a windmill pump to pump water (no need for electricity etc.). So he is bringing in $200.00 pesos a day or $6000.00 pesos a month. He pays his workers well and they all are good workers or he says they won’t be working for him long. Although it has taken a long time I think that Raul and the government are finally coming around to the idea that government can’t run everything. The closing of the 100 state farms could be a shift in policy to more private or co-op farms.

  5. Follow up post #5 added on March 18, 2010 by gallofino with 20 total posts

    “I think China makes inner tubes and water pumps. They are giving free buses and trains to Cuba. If the Cuban government wanted farmers to grow food, the country would be FILLED with Chinese made tractors and farm equipment. FILLED!

    I think the Chinese know a thing or two about farming but obviously the Cuban government does NOT want the Cuban people to be successful farmers.”

    I lost you at the free buses.  Do you know something I don’t about the pay structure on these vehicles?  There have been some serious quality issues across the board with the Chinese imports, just a taste for Cuba to gag on, but bitter nonetheless.  The Geely automobile is another example.  It wouldn’t pass any NA crash tests and the police are calling them death traps and now one of Fidel’s sons is in very bad shape after an accident between a Geely he was driving and a Moskovich driven by another Cuban.  Imagine a 20 year old Moskovich coming out of an accident (much) better off than brand new Geely.  And they are thinking of renting these things to tourists?  I mean, sure there are people ignorant enough but most wouldn’t I think.  Maybe that’s the motive for the health insurance?

    Pipefitter touched on the silliness of the Cuban supply chain.  The inefficiencies are staggering.  Even when a given part is verified to be in country the desire to purvey it to the cooperative or corporation that needs it is absent.  Even with an order and all approvals, people are scared to stick their necks out or infringe on anyone’s “invention” (corruption) by selling something they plan to steal and sell to pocket the money.  This is what happens when people are both underpaid and afraid to do their jobs.  In Cuba, its yes, yes, yes all along the chain until ONE person says no.  Then its no y punto.  It happens at ALL levels of government and business and is enough to drive anyone mad.

    Another issue that seems lost on people here is that the state has rarely managed or maintained its fleets of vehicles.  Most of the people I know that drive trucks, taxi’s etc. are the ones who maintain them as a dump truck that doesn’t work is a driver that doesn’t work (could be for months on end with a family to feed) and so on.  With one or two loads “desviado” the driver can buy a tire on the black market.  Mostly because the decision to part with it is in the hands of the person selling it as opposed to a supply chain mire in deep bureaucracy .  In the end it is almost always stolen from the state anyways…  In this case both the tire and the gravel used to buy it are.

    There are some very successful farmers in Cuba and not acknowledging that is a display of ignorance and perhaps fear.  Imagine if Cuba’s autonomy initiatives work out for the farmers and now the taxi’s and hair salons.  Imagine how nice it would be if they could support their domestic food needs without having to purchase abroad.  Imagine Cuba once again exporting significant amounts of food!  This I think is a major fear for many people.  Chinese tractors?  Why?  There are thousands of Soviet ones running around and idle in various stages of disrepair.  But they still resolve the problems.  Many of them by the way are privately owned and can be hired for a song even by Cuban standards. 

    Bottom line is that the state is handing off the ball to individuals and those that run with it will do well while those that curl up in fear or choose to sip chispa and complain all day will get nowhere.  Sound familiar?

  6. Follow up post #6 added on March 18, 2010 by publisher with 3905 total posts

    “China will sell 1,000 of the Yutong-brand buses to Cuba on easy credit terms, and has already delivered about 200, according to Cuban government announcements.”

    from this article about China investing in Cuba.

    Cuba hardly pays any of its bills let alone those with terms like “easy credit”.

    Cuba consulting services

  7. Follow up post #7 added on March 18, 2010 by jmw1 with 62 total posts

    Has anyone paid attention to the focus on the so-called ‘experiments’ of free market economy?

    Hair salons
    Retail stores

    Tourist based income businesses by large.
    Zero impact or benefit to the ordinary Cuban (aside of slightly better wages)
    Castro inc takes the lion’s share, again.

  8. Follow up post #8 added on March 18, 2010 by gallofino with 20 total posts

    The last two posts I attempted here disappeared.  I at least partially addressed jmw1’s list in those…

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