Tuesday, November 9, 2010

Cuba To Promote Foreign Investment

Cuba in future will be a country that promotes foreign investment, expands the private sector and dutifully pays off its debts, according to a proposal revealed on Monday by the ruling Communist party.

But it will not renounce the socialist system installed half a century ago after Fidel Castro took power in a 1959 revolution, according to the 32-page document that will guide debates at a Communist party congress in April.

"The economic policy in the new phase will correspond with the principle that only socialism is capable of overcoming difficulties and preserving the gains of the revolution, and that in the updating of the economic model, planning will be paramount, not the market." - it said.

The document, entitled "Guidelines of Economic and Social Policy," is the program of reforms President Raul Castro will place before the party congress for its consideration.

They could be modified during extensive public discussions ahead of the congress, which was announced by the president on Monday night and will be the first since 1997.

The congress is where Cuba's only legal political party sets direction for the country, supposedly for the next five years, although it will have been 14 years since the last meeting.

The April gathering will be particularly important because, given the age of current leadership, it will be the last for the generation that fought the revolution and has held power since then, hewing hard to communist ideology.

President Castro, 79, took office in 2008 after older brother Fidel Castro, 84, ruled the island for 49 years and finally resigned due to ill health.

He promised to improve the daily lives of Cubans and has focussed on economic improvement, including major reforms announced in September to cut a million government jobs and expand the private sector by granting 250,000 new licenses for self-employment.

He said Cuba's economy will be the only topic at the congress.

The guidelines include reforms already begun by Raul Castro -- among them the reduction of the state's role in the society and the decentralization of agricultural management.

They include a proposal to eliminate the monthly food ration Cubans receive, symbol of decades of state paternalism and a particular target of Raul Castro, who says handouts have discouraged productivity.

They also call for provisions for bank credits for the new self-employed and wholesale stores to cut their costs, but also for them to pay taxes to finance public spending.

In contrast to past policy, state-owned businesses that do not make money will be completely liquidated.

And the authorities will look to improve the country's international credibility "through the strict fulfilment of contract commitments."

Cuba's standing with the international business community has been damaged the past two years as a cash crunch forced the freezing of Cuban bank accounts held by foreign businesses and of payments to many of them.

The party also proposes "to continue encouraging the participation of foreign capital in Cuba, complementing national investment in those activities of interest to the country."

The document mentions, for example, the development of golf courses, marinas and luxury condominiums to attract wealthier visitors to the Caribbean island.

Raul Castro said that before being distributed, a copy of the guidelines was submitted to Fidel Castro for his consideration. Even though he is no longer president, he is still head of the Communist party.

By Esteban Israel

From: SwissInfo

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