Cuba To Implement a Macroeconomic Stabilization Plan

Orinoco Tribune, December 25, 2023 —

On Thursday, Cuban Prime Minister Manuel Marrero presented the macroeconomic stabilization program that will be implemented to boost the Cuban economy in 2024.

This program includes measures aimed at increasing foreign exchange income by promoting exports of goods and services and increasing the participation of foreign investment, especially in the production of food and energy.

Cuban authorities will reduce tariffs on intermediate products and increase tariffs on final products to promote the competitiveness of local industries.

Among the measures to reduce the budget deficit, it is proposed to update fuel prices, which are currently imported by the State and distributed with subsidies. A network of gasoline distribution stations will charge tourists for fuel in dollars.

Policies to reduce the fiscal deficit will also include the application of new rates to transportation services, a 25 percent increase in electricity rates for those citizens with monthly consumption greater than 500 kWh, an increase in the rate for drinking water, and an increase of the retail price of liquefied gas.

Regarding the allocation of resources through the State, the macroeconomic stabilization plan seeks to move from a model based on universal subsidies towards targeted transfers in favour of low-income groups.

In order to achieve this policy objective, which implies stopping subsidizing high-income groups, the Ministry of Labor and Social Security will be in charge of defining vulnerable groups. The supply book will be maintained, even in the context of high international inflation.

The Cuban government will seek to increase employment levels by promoting investments, systematizing job fairs, and reducing levels of labor informality. A system of “additional payments” will also be implemented to improve the situation of health workers and teachers.