Supporting private enterprise to thrive in Cuba


Charles Shapiro, U-T San Diego


Shapiro is president of the Institute of the Americas (, a think tank on the campus of UCSD. He was the U.S. ambassador to Venezuela from 2002-2004. The views in this commentary are his, not those of the institute.


In May, together with a long list of American business, academic and NGO leaders, I signed a letter to President Obama urging changes in the Cuba embargo regulations. The major change can be summed up very simply: remove the embargo from the Cuban private sector.


What could make more sense than to encourage private Cuban citizens -or the citizens of any country- to open businesses, to compete in the marketplace and to succeed? Those for and against the embargo can argue the utility of an embargo against the government of Cuba, but independent business people make the decisions that affect their lives, and that’s exactly what we ought to encourage.


Keeping in mind that at the end of the day it is the government of Cuba that sets the conditions for the business environment, let’s remove the obstacles the United States has placed in the way of these entrepreneurs.


The Institute of the Americas has now organized two educational trips to Cuba. We met with as broad a range of people as possible: the Catholic Church, the Patronato synagogue, musicians, writers, U.S. and third-country diplomats, the Cuban Foreign Ministry and above all private entrepreneurs.


Cuban entrepreneurs run restaurants, bars and B&Bs. They are professors who moonlight by giving lectures to groups like ours. They are DJs and hip-hop artists, hairstylists, dressmakers, photographers and event planners.


The people we spoke with don’t think of themselves as entrepreneurs, but as cuentapropistas, a Cubanism meaning people who are working on their “own account.” Somehow, entrepreneur sounds too grand in that Communist nation.


Some businesses are tiny. Others, like restaurants, employ significant numbers of people. But they all face daunting obstacles: no wholesale suppliers; little or no financing; convoluted supply chains; and limited Internet access. There are few building contractors and the ones there are have no building supplies.


Above all, government regulations shift inexplicably. Licensed tailors and dressmakers could for a time import clothes and sell them at retail prices, until the government changed its mind. Private movie theaters were allowed and then disallowed. A taxi driver can now buy a used car but it will cost more than $50,000 -a millennium worth of wages when the average state paycheck is $20 a month.


Nevertheless, the opening of the Cuban economy to “self-employed” has been dramatic within the Cuban context. UCSD’s Dr. Richard Feinberg estimates close to 1 million self-employed.


More people are earning more money than they did as state employees. Others have become cuentapropistas because they have no choice.


The government has reduced the number of state employees because it cannot afford to keep them on the payroll.


Relative to what Cuba needs to do to catch up to China or Vietnam, the changes are slow and tentative.


The United States should support small but concrete actions that will help Cubans while we wrangle over policy toward the government of Cuba. Normally, bilateral relations are the purview of the executive branch. But American policy toward Cuba was enshrined in law in 1996 and cannot be changed without modifying that legislation. That is not going to happen anytime soon.


What the administration can do is remove obstacles to the incipient Cuban private sector.


Let’s start with the Internet.


The United States should do everything we can to facilitate Internet access for Cuban citizens. Ordinary Cubans wait for hours to purchase Internet time at Cuban telephone company offices, the closest thing there is to Internet cafes.


Anything we can do on our end to facilitate real Internet access in Cuba is worthwhile, even if the “price” of doing that is working with the Cuban government telecommunications monopoly.


We should make our licensing processes more flexible and make it clear that the United States government will not penalize U.S. companies offering Internet-related services or equipment for sale to the Cuban state telecom company, and that we will support those companies in court if they are sued by American citizens owed money by the government of Cuba.


The United States and Cuba have painted ourselves into opposite corners of the same room.


With 55 years of demands and counter demands, neither country can get out without the help of the other.


Helping people succeed in their small businesses and facilitating unfettered Internet access will make them more independent of the government of Cuba.


That is an outcome we all want to encourage.



Cubanálisis - El Think-Tank