Cuba’s Economic Performance:

Reserves of efficiency persist in the Cuban economy, stated Marino Murillo Jorge, a member of the Party Political Bureau, council of ministers vice president and Minister of Economy and Planning. Photo: Jorge Luis González

Information presented by Marino Murillo Jorge, a member of the Party Political Bureau, Council of Ministers vice president and minister of Economy and Planning, regarding the country’s economic performance in 2015 and forecasts for 2016, was analyzed during the plenary session of the National Assembly held December 29.

As has been previously reported, Cuba’s Gross Domestic Product (GDP) grew 4% this year, mainly due to the acquisition of cash advances, contracts to secure credit, as well as a downward trend in the price of imports.

This, noted the minister, gave the country greater purchasing power, allowing it to acquire a larger amount of raw materials.

Murillo described this increase as a positive result, considering Latin America’s minimal growth rate over the year, due in large part to the difficult economic situation in countries such as Venezuela and Brazil. Nonetheless, he warned that greater efficiency remains to be achieved.

The Minister highlighted the impact of measures implemented within the state enterprise sector on the country’s positive economic performance, in particular making social objectives more flexible and the application of Resolution 17, linking salaries to production.

In this sense he reiterated that it is impossible to distribute wealth the country does not produce, thus the policy is geared toward increasing salaries in line with greater production.

Murillo explained that all sectors have seen an increase with respect to 2014 and referred specifically to the sugar industry, which grew by 16.9%, construction by 11.9%, and manufacturing by 9.9%.

He highlighted the rise in material production – from 59.3% in 2014 to 61.1% in 2015 – as a key factor to GDP growth; while services constituted 25% of the country Goss Domestic Product.

He stressed that a clear objective is to prioritize and protect domestic producers, in order to further reduce imports.

Regarding construction, he stated that, in 2015, 27,480 homes were completed (12,480 state constructions), and also mentioned the impact of the manufacturing industry, which despite producing few exportable products, contributes to substituting imports.

Photo: Juvenal Balán

The minister noted that raw materials were prioritized in the sector which, despite fluctuations in productivity and inadequate marketing, saw substantial growth.

In regards to energy Murillo noted that the results of checks and audits showed the persistence of inadequate accounting, with the potential to increase efficient energy consumption.

He also reported that the average monthly salary for state enterprise workers had increased, although this is still insufficient, considering retail prices.

Regarding the implementation of Resolution 17, he said that despite having been successfully applied in some areas with a reduction in the number of entities where the salary cost per peso of gross value added had deteriorated, 113 facilities are still failing to meet this target. “Higher salaries can not be paid without the corresponding productive support,” he emphasized.

The Council of Ministers Vice President outlined the main areas in which the country is working to achieve the expected economic growth in 2016. Among these, he mentioned enhancing efficiency in the use of hard currency, taking advantage of the downward trend in prices, the rational use of stocks and supplies, and consumption rates that encourage savings.

He also noted that resources should be concentrated on activities that generate export earnings and import substitution, tourism and the retail sector, with a predicted increase in all these areas for 2016.

We must work to achieve sustainable level of debt, which simply means using revenue to settle outstanding debts, commented Murillo, who also noted that feasibility studies must be closely observed and deadlines met, if investment returns are to be used to pay off the initial expense.

Regarding the performance of the national economy, he noted that macroeconomic indicators met projections in the country’s 11 principal economic sectors.

He announced that growth for next year is estimated at around 2%, with the largest increases projected in construction, hotels and restaurants, agriculture, livestock, forestry, transport, warehousing, communications, the sugar industry and the supply of electricity, water and gas.

However, declines have been seen in mining and quarrying, fishing and the production sector (except sugar). Next year, 1,940,000,000 pesos will be allocated for food imports, 25 million less than in 2015.

The official also spoke about the reorganization of energy sources, an area scheduled to undergo a 5% increase in efficiency and a 20% reduction in administrative activity.

Murillo noted that more efficient energy consumption in the service sector is prioritized for 2016, while resources must also be directed toward profitable activities.

Of all cargo moving activities he highlighted transport enterprises as the most efficient, stressing the need for specialized entities to fulfill their contract commitments.

Some 7,841,000,000 pesos will go toward the building and assembly of machinery in 2016, he explained.

Fifty-eight percent of the national plan, he noted, will finance investment works across sectors vital to the country’s development, including tourism, energy, oil, food and live stock programs, initiatives to combat drought and sanitization activities.

Resources will also go toward the development of infrastructure in the Mariel Special Development Zone, production of sugar and its derivatives, telecommunications, as well as increasing construction capacities and the production of building materials.

The Minister of Economy and Planning reported that 11,311 state homes are scheduled to be built in 2016, while personal and subsidized construction initiatives will also be prioritized.

Demands for cement, wood, steel and dry building materials are covered in the budget for construction materials, he noted.

He also highlighted that all resources left unused, when plans are not fulfilled, will be made available for purchase by the population, earnings from which will go toward financing subsidies for low income households.

He likewise noted that 80% of national water demands will be met (7.1 billion cubic meters) which does not include over 800 million cubic meters due to the impact of drought.

Next year will see the monetary-fiscal balance maintained, while goods and service offers, and non-regulated sales of foods will increase.

According to Murillo, next year will see the average Cuban wage increase to 653 pesos a month. He also reported that credit assumed will rise to more than 6.5 billion dollars to cover 53% of import costs, while almost 5.3 billion must be allocated to repay debts.

Advertisements
This entry was posted in Uncategorized. Bookmark the permalink.

Leave a Reply

Fill in your details below or click an icon to log in:

WordPress.com Logo

You are commenting using your WordPress.com account. Log Out / Change )

Twitter picture

You are commenting using your Twitter account. Log Out / Change )

Facebook photo

You are commenting using your Facebook account. Log Out / Change )

Google+ photo

You are commenting using your Google+ account. Log Out / Change )

Connecting to %s