Cuba Business News and Information
Sources from Cuba tell me that the Cuban Convertible Peso will be eliminated this month and ONLY the common Cuban peso will be valid currency.
Here’s more info from Wikipedia.
Watch this post for updates.
Is it a reliable source ? Did they say they would bring back th US dollar ?
I believe it was just read on Cuban television.
It is my understanding that there will only be one currency.
I’m getting third hand so be patient for updates.
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Since Wednesday I have been hearing this and rumours are flying from all over Cuba. According to my friends in Santiago, it has caused some panic buying/selling in CADECA but nothing definite.
Some are hanging to the words of the new presidente and his “promise of change” and veiled criticism to the two tier currency system
Let’s keep an eye on this, I don’t think Cuba is ready for this in the short term
Some background on the monetary policy of Cuba’s central bank
http://www.bc.gov.cu/English/mon_policy.asp
Some of the comments this week
http://cubantriangle.blogspot.com/2008/02/peso-speculation.html
http://www.washingtonpost.com/wp-dyn/content/article/2008/02/26/AR2008022603576.html
http://miamiherald.typepad.com/cuban_colada/2008/02/cuban-in-miami.html
UTTER NONSENSE.
This variation of the Radio Bemba news is right up there with 1,000,001 Miami rumors of Fidel’s death : for the last 45 years! (Gusanos will pretend they never said it or wrote it, but that’s typical of their disinformation campaigns. Every one a Perez Hilton in his or her own mind!)
According to the BBC News 2/28/08:
“We are examining the progressive, gradual and prudent revaluation” of the Cuban peso, Raul Castro said.
According to the The Economist 2/28/08:
“In his speech, Raúl also gave broad hints of economic changes. He recalled a commitment by Fidel in 2005 gradually to revalue the peso. Since many prices are set in hard currency, that is essential if wages are to rise above their average of $20 a month.”
According to the Washington Post 2/26/08
Faced with what amounted to a small-scale run on its banks, the government aired a report early Tuesday on the morning news program Buenos Dias emphasizing that any changes to the money system would be gradual.
According to the China Post 2/27/08
While no major political changes appear to be planned, Raul Castro said his top priority was improving standards of living with measures such as greater food production and a revaluation of the Cuban peso that would make goods cheaper for average people.
Have just talked to the Cuba Tourist Board in Canada, and they have not heard anything about this, and have informed me that it will still be the Convertible Peso for the forseabule future.
Some sources near the Cuban representation in the UK have dismissed this as rumour for the near future. However, everyone seems to be expecting some changes in the monetary policy in the long term (ie gradual revaluation of the peso in Q3 2008)
Thank you. Perhaps our source is not as reliable as we had expected.
It was my understanding that this was on Cuban television.
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we called cuba on the weekend and have a friend who works in a Cadeca(not in Havana) and they have not been told anything about the convertible peso being stopped.....
i know from Cuban friends the rumor has been going around for over a year that some major currency reforms are being worked and and will probably lead to a single currency. But these are at the rumor stage - nothing definite and no timeline.
The major problem with a single curency is of course how to keep prices different for tourists and locals.
Remember when East Germany was dying and we were all buying our East Marks in west Berlin at 15 to 20 : 1 instead of at the border at rate of 1:1 and buying everything that wasnt tied down because of the buying power - wasn’t a pretty sight.
I heard from friends near Santiago de Cuba 2 weeks ago, that the convertible peso (which is now 24 MN pesos) will change to be worth 12 MN pesos, SOON. I too am looking for answers and I have some interests in Cuba.
Now that’s inflation. Makes everything twice as expensive, right?
Just what the Cuban people need.
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No! On the contrary.... When the people only need to use 1/2 the amount of MN Pesos, then they can buy twice as much stuff when shopping in the places that only take Convertible. It’s twice as good for them.
It was reported that there were long lines at the Cadena to cash in their currency.
Why is that?
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"Cadeca” is the name of money exchanging locations in Cuba. It is a State owned KIOSK or Building with Windows that people sit behind, similar to other North American money exchange locations that you may find in an airport. People in Cuba and Tourists (me included) visit these locations to cash Cuban Convertible (CUC) pesos for MN Pesos. This can also be done at a bank, however these locations are widespread and more convenient.
Check out the following link for more specific information on Cadeca:
http://www.cubacurrency.com/casas_de_cambio_sa_cadeca.html
John , even in a centrally controlled economy, the law of supply and demand eventually prevails. Ultimately, they will wind up paying twice as much for the same products. It is like swimming in jello. In the long run, they truly will be no better off then they were before. Sad but true
