Cuba, which is suffering an economic crisis under the United States' all-around sanctions, has declared reform and opening. It appears to be pursuing the China-Vietnam model, keeping the socialist system while marketizing only the economic institutional sector.
On the 18th, local time, according to the Associated Press and others, Cuba Prime Minister Manuel Marrero announced an emergency economic package containing 176 pro-market reform tasks at the National People's Congress of China, Cuba's equivalent of a parliament.
The package includes expanding private corporate activity, abolishing price ceilings, reforming and strengthening the autonomy of state-owned corporations, attracting additional foreign investment, and modernizing the financial system.
First, Cuba will embark on a sweeping government reorganization to boost efficiency by reducing the current 27 ministries to 21. It also decided to phase out subsidies under the basic rationing system that has supported livelihoods since the Cuban Revolution and shift to a market pricing regime.
In addition, it will allow the establishment of private companies with 100 or more employees and permit individuals to own multiple corporations. It also includes a drastic step to open even finance and real estate development to the private sector while allowing transactions of shares and equity in state-owned corporations.
In his speech that day, Prime Minister Marrero effectively endorsed the role of a market economy, saying he recognizes the market as "a tool for the efficient allocation of resources."
Earlier, the Communist Party of Cuba held an ad hoc plenary meeting the previous day and approved the emergency economic package. Cuba President Miguel Díaz-Canel also said at the plenary that not only the U.S. economic blockade but also long-standing bureaucracy and excessive regulation are blocking economic development, calling for strong regulatory reform.
In his closing speech at the plenary, Díaz-Canel said, "The problem is not only the external blockade," noting that "slow-walked administration and bureaucracy, various regulations, and delayed decisions that block those who want to engage in production activities are stumbling blocks to the Cuban economy."
The Cuban economy has suffered a severe slump in recent years, and shortages of electricity, energy, and daily necessities have worsened, especially after the United States imposed large-scale additional sanctions in Jan. With Washington ratcheting up pressure on former Council of State Chairman Raúl Castro, the Cuban leadership is seen as having decided to adopt market-economy elements on a large scale.