HAVANA, Dec. 27th Six months after being appointed as the new president of Cuba, Miguel Díaz-Canel will preside over ceremonies marking the 60th anniversary of a revolution while facing a stagnant economy and growing citizen protests.
Six decades into its socialist experiment, his government is still trying to figure out how to satisfy the basic necessities of its population.
With minimal economic growth in 2018 and continuing shortages of basic staples like flour at year’s end, experts say the government is failing under his leadership.
And unlike his predecessors, who ruled with almost absolute power, Díaz-Canel exposed internal conflicts earlier this year when his government reversed unpopular regulations to increase control over the private sector, was prone to soften a decree that legalizes censorship of independent art, and decided to withdraw from the draft Constitution a controversial article that would open a pathway to same-sex marriage.
The move was viewed by Cuba watchers as a response to fear of losing support from members of the religious sector for a referendum that is up for a vote in 2019.
“By revising the regulations governing the private sector and making concessions to the artists on the decree law regulating the arts, the government has shown a responsiveness to organized public pressure that is unprecedented,” said William LeoGrande, a Cuba expert at American University who recently participated in an event organized by the Cuban foreign ministry in Havana.
“In the past, the government modified some draft laws after public discussions indicated opposition to particular features, but its response to organized opposition in the past has been unyielding,” LeoGrande said. “This pragmatic response indicates both the government’s flexibility and also its recognition that the Cuba of 2018 is not one in which people will simply accept whatever the authorities dictate.”
Six decades after the Jan. 1, 1959, triumph of the revolution led by the late Fidel Castro, Díaz-Canel stands as the figurehead of a country that only recently gave mobile phone users access to the internet, just in time to post videos of people standing in long lines to buy bread and to document private taxi drivers who went on strike in protest against new control measures implemented by the state.
Limits on the number of permits for private sector work that any one person can have and the number of chairs allowed at private restaurants known as paladares, which were included in a decree published in July, also sparked profound discontent among the so-called self-employed (cuentapropistas) and dismay from foreign governments and experts who had expected an economic opening from what was supposed to be a more modern government with a younger face.
After months of criticisms, Labor Minister Magarita González announced in early December that those two measures had been erased.
On Twitter, Díaz-Canel defended the decision and dismissed speculation that it was the result of a fragile government: “There’s no reason to believe that corrections are steps backward, or to confuse them with weaknesses when the people are heard. Revolution is to change everything that should be changed. None of us is as powerful as all of us together,” he posted.
But the tribulations of Cuba’s new leader — he was appointed to succeed Raúl Castro in April — did not stop there.
Cuban artists put up a united front to criticize Decree 349, which legalizes censorship of works of art and requires artists to obtain a government work permit. The protests also drew support from dissident artists like Tania Bruguera and even icons of the revolution like singer Silvio Rodríguez.
“Decree 349 is something that they put in front of our president to sign, without any discussion among the artists,” Rodríguez wrote in his blog. “Maybe there should be a moratorium on the decree, until it is discussed and an acceptable modification is found.”
Although the decree was made public in July, after Díaz-Canel was appointed president of the Council of State, it was signed by Castro, who remains head of the ruling Communist Party of Cuba.
Díaz-Canel “does not hold the same historical legitimacy of Raúl or Fidel or the same ultra-concentration of power, and the people know it,” said Ted Henken, a Baruch College professor who follows Cuban affairs. The new leader “feels popular pressure more than the previous presidents because he’s trying to establish his own legitimacy, in part by trying to listen to and respond to the people’s complaints.”
Experts agree that to win popular support, Díaz-Canel will have to offer tangible improvements in the daily lives of Cubans, which seems unlikely in the short run because of the island’s complex economic and political situation and an administration in the United States that has vowed to step up pressures on the Cuban government.
Cuba’s Gross Domestic Product (GDP) grew by slightly more than 1 percent in 2018 but the growth “still does not help the people like what we need,” Díaz-Canel told the National Assembly at year’s end. The government predicted a 1.5 percent GDP growth in 2019, but its figures are not comparable to the rest of the world because Cuba includes spending on health, education and social services.
“Cuba’s productive machinery does not totally collapse, but it also doesn’t create economic progress in the last 30 years,” economist Pavel Vidal wrote in an article published on the digital site, Cuba Posible.
The island has still not recovered from the withering economic crisis in the 1990s known as the Special Period, Vidal added, “but it must be acknowledged that it is a system that has proven to be effective at managing the crisis and avoiding economic collapse, just as it has been ‘effective’ at limiting private initiative, innovation and increases in productivity.
“It is a system that holds the record for the lowest levels of investment in Latin America,” he added.
Díaz-Canel’s recent visits to Russia, China, Vietnam and other Asian countries — with stops in the United Kingdom and France — also did not bring the expected benefits. For 2019, the confirmed foreign investments will account for barely 6.2 percent of all planned investment in the country.
After his return, Diaz-Canel ordered his cabinet ministers to review about 80 investment proposals, some of them already on the books for several years.
Vidal believes the Cuban economy has been in recession for several years, even though the official figures show growth. But to keep up economic indicators like GDP, the government has been forced to adopt austerity measures such as cutting imports and expanding its budget deficit to levels unseen since the Special Period.
The government also has stopped making payments on some foreign debts that had been renegotiated with several countries, according to state media reports.
Minister of the Economy Alejandro Gil Fernández spoke about the “elevated level of debt faced by the economy due to the non-payment of renegotiated debts, an issue that will also impact the government in 2019 because that financial problem cannot be resolved in the short run,” the official Granma newspaper reported.
Drops in exports and tourism — which fell short of 5 million visitors — plus the impacts of Hurricane Irma and the U.S. embargo were cited by Gil Fernández to explain the low growth. Additionally, there is the cut in subsidies from the Nicolás Maduro government in Venezuela, an ally suffering through its own economic crisis.
Sugar production dropped so much that a clearly exasperated José Ramón Machado Ventura, the octogenarian No. 2 at the Communist Party, complained, “Why do we want sugar mills if we don’t have any sugar cane?” Granma used the quote in a headline, but changed it after independent and foreign news media reported on it.
The shortages have been more sharply felt at this year’s end, when Cubans are having problems finding basic items like bread, eggs and chicken. And 2019 looks no better because the government has announced further cuts in food and fuel imports.
Recently, the government announced an agreement with Major League Baseball that could replace some of the millions lost by the Cuban government when it recalled medical personnel working in Brazil. Cuba allegedly kept as much as 80 percent of the salaries paid to the physicians fulfilling required assignments overseas.
Under the new agreement with MLB, the Cuban Baseball Federation will receive 15 to 20 percent of the total value of each contract for a player who joins a team in the United States. Havana also will impose a new tax on the personal income of baseball players and other athletes contracted to play abroad, according to Lina Rodríguez, minister of finance and prices.
But those quantities are minimal when compared to the foreign investments the island needs, estimated at $2.5 billion per year.
The proposed new constitution pushed by Raúl Castro while he was president had generated some hopes for change. But the final version that will be submitted to a referendum maintains Communist Party rule and a centrally planned economy. It legally recognizes private property, but makes no mention of popular demands such as allowing for the election of the president by direct vote and giving Cuban Americans the right to invest in the island.
Resistance to a greater economic opening was so strong among Cuban conservatives that the secretary of the Council of State, Homero Acosta, had to address the National Assembly for 10 minutes to defend a change in the proposed constitution: wording that required the government to limit wealth was changed to require the government to redistribute wealth.
“Sometimes, when we talk here about wealth, when we compare it to what’s described in the world as accumulation of wealth, it’s laughable. Sometimes there’s talk of the wealth of a taxi driver or someone who owns a tiny kiosk, but that’s not wealth anywhere in the world,” Acosta said.
He described the private sector as “a sector that we cannot attack or repress.”
“The government has no economic solutions to the country’s economic problems,” said Henken, the Cuban affairs expert. “It has only political and bureaucratic and ideological solutions, which is why they always have to go back to square one. Until they use economic logic and solutions, this cycle will continue.”