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The adventure of being an entrepeneur in Cuba

The adventure of being an entrepeneur in Cuba

Posted by Miguel Ernesto on December 30, 2014

The outlook in Havana has considerably changed in the blink of an eye. The streets, once gloomy, are now full of posters and lights, many of them lightened with neon lights, show a picture that was absent from the Cuban economic scenery for more than four decades: the spread of privately owned businesses.

From palates (restaurants), bars and cafeterias, going by phone repairs and computers, to photography studios and gift shops, private initiatives keep growing in a scenery of economic reforms, supported by a legal framework that even though many consider insufficient, has opened a new path doesn't seem to have a way back.

The official figures show that 2014 will end with more than 416 thousand people (9% of the active population) that are under “non-state forms of management” which distributed in 200 categories some of which are completely unused such as “botton coverer”, but leaving out those linked with professional capital. Besides, the government has allowed the creation of cooperatives, both agricultural and others for different services (329 in total).

In the gastronomy sector and technical and professional services, for example, from the 13 thousand shops that exist in the country, the state has rented 3570 to business owners, in which there are 11 270 people. The authorities say that the rest of the shops will gradually be managed –although not owned- by privates.

Entrepreneurship has been seen as a blowoff valve so that unemployment doesn't grow in the country, specially taking into account the decrease in the wages in different state companies, trapped in their inneficiency and their lack of capacity to keep up with their high costs. The economic situation of Cuba in 2014 was again, very complex. The government admitted that growth was of only 1.3%, below the expected 2.2%. Although according to the minister of economy, Marino Murilo, in 2015 “a 4% growth is expected, which will add up for the slow growth and stop that tendency of deceleration of the last years”.

Each Bill speaks for itself

Alberto has no clue about the economic situation of Cuba 2014; but he doesn't hesitate in saying that “the situation is tough”. Every week he receives between three and four orders of customers that want to update the databases of software and antivirus and also to download apps in phones and tablets, especially with the android operating system. Alberto is a computer engineer and used to work at a state company; although with “the new times”, he said it be more profitable to be an entrepreneur of the software world.

In a country where Internet penetration is still low, the demand for apps has notably increased in the last years. “Those are good news for me” says Alberto who doesn't have Internet access but has a friend that downloads apps from different websites and he installs them later. “I make four times of what I made when I was working, for a whole year, eight hours a day, in a state company. I would really like to work in programming, creating software, which is what I like to do, but I have to make a living” says the 27 year old engineer.

One of activities that have proliferated the most is renting real estate. In the main spots of the Cuban capital- Vedado, Playa, Downtown Havana, and the old Havana- it is not hard to find a poster hanging in the door of a house or an apartment that says there is an official renter in convertible Cuban pesos. Carmen worked for more than two decades in the education industry. In mid nineties, when business owning was officially approved, she decided to use one of the three rooms in her house, located in the Castro municipality, for rent to foreigners. She stayed like that for two years, but then she shut it down. “There were too many issues at that time”, she admitted.

With the new reforms she wanted to go back to the renting business. “ I have done relatively well”, Carmen explains, she rents her room (with air conditioning, TV, and a private bathroom) for 25 or 30 CUC a day, which is cheaper than hotels; furthermore she also has breakfast and lunch available for thought who need it. “I still struggle to buy things because we still don't have wholesale markets, which means I have to shop where everybody else does. It is one of the things we’ve asked for the most, specially for palates owners, but it would be really good for me too, however so far, the law hasn't replied”, she said.

Every morning Yoan wakes up at 4:30 am and an hour later he begins work. He is a chauffeur of a Chevrolet ’56 and with it he gives his customers a long way between La Palma and the Vedado. Every passenger pays 10 pesos (national currency) and Yoan says he can make between 1200 and 1600 pesos; but of those he must give 1000 to the car owner because he is only in charge of driving it, besides to the money I make you need to take away taxes, costs of car breakdowns and the cost of gas. “The one who makes the big bucks is the owner, but I can go by”, he says while he smiles and keeps his eyes in the road.

The lack of a wholesale market and the impossibility of receiving foreign investment in a legal way are some of the issues entrepreneurs face. Despite these obstacles, private businesses have become a thing in Cuba. Havana and the rest of the cities have become full of posters, many of them lit up with neon lights, with better or worse tastes. This is the clearest sign of Cuban entrepreneurs finding new alternatives in a country that keeps changing. 

By M. Gómez  Fotos: F. Medina. PanamericanWorld. La Havana

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