ECONOMY-CUBA:
Does the Ration Book
Still Make Sense?
By Patricia Grogg
HAVANA (IPS) -
Criticised as one more
sign of the failures of
socialism, or viewed as
a right that should not
be given up, the ration
book, part of Cuban life
for 46 years, could
disappear as a result of
the transformations
needed in the country’s
economy.
Economists consulted by
IPS said there appears
to be a consensus in the
government about the
need to eliminate this
form of across-the-board
distribution which,
while it played its part
at one time, is now an
anachronism, and if
anything, contributes to
inequality.
However, "it can’t be
withdrawn abruptly, and
besides, it would need
to be accompanied by a
series of measures to
prevent a drastic impact
on some sectors of the
population," Professor
Armando Nova told IPS.
"We must work towards
eliminating this
distribution system that
gives all of Cuba’s 11.2
million people the same
benefits, even though
some people don’t need
them," said the economy
professor.
"It might be better to
subsidise individuals
and families rather than
products, but it must be
part of a very
well-thought-out,
systematic process," he
said.
Debate on the topic has
increased since Cuban
President Raúl Castro
said the enormous
subsidies, which include
the products distributed
under the ration book
system, are irrational
and unsustainable in the
country’s current
economic conditions.
Official sources report
that the average annual
cost of basic products
that are rationed and
sold at subsidised
prices is one billion
dollars. But this year,
total food imports will
amount to 1.9 billion
dollars, due to soaring
food prices on the
international market.
"The ration book
products don't cover the
entire month, but at
least the system ensures
that I can get a few
things at low prices:
rice, some beans, sugar,
and a bit of protein.
Even so, my pension
vanishes like a vapor.
If they take it away,
just imagine what it’ll
be like," said Digna
Pérez, a 59-year-old
retired teacher.
Besides the items Pérez
mentioned, every person
is entitled to a monthly
ration of oil, 10 eggs,
toothpaste and soap,
among other products.
Until the late 1980s,
rationed supplies also
included manufactured
goods.
A document from the
United Nations
Development Assistance
Framework (UNDAF) in
Cuba says that access to
this food quota is a
right guaranteed to
every citizen, and
emphasises that
additional supplements
are provided for
vulnerable groups with
extra needs, such as
children, pregnant and
lactating women, and
people who for medical
reasons have specific
dietary requirements.
According to Nova,
studies indicate that
the rationed food
received by Cuban
families now provides
approximately 36 percent
of the daily calories
needed per person,
lasting about 12 days a
month, whereas proteins
last 10 days, and fats
cover nine days a month.
"The ration book is only
a shadow of what it was
in the 1960s. But while
it is not the major
source of food in terms
of total intake, it is
not insignificant
either," said Nova, who
carries out research at
the University of Havana
Centre for the Study of
the Cuban Economy (CEEC)
at the.
"In fact, the ration
book is only a shadow of
what it was in the
1960s, nor is it a
determining factor in
total food intake, but
neither is it to be
despised," said Nova, a
researcher at the
University of Havana’s
Centre for the Study of
the Cuban Economy (CEEC).
The rationing system was
created in March 1962 to
combat food shortages
caused, in part, by the
stance taken by the
United States, Cuba’s
main supplier at the
time, which cut off all
ties with this country
because it objected to
the direction the Cuban
Revolution was taking.
Another reason given was
the growth of purchasing
power of the population,
which outstripped the
rate of production of
consumer goods and the
state’s capacity to
import them. Rationing
meant that a minimum
quota of food and goods
could be guaranteed to
all the population at
subsidised prices, which
were sometimes below
production costs.
"It was a difficult
situation that could
have been explosive
internally, and the
ration book fulfilled
the aim of ensuring that
every family had the
basic necessities. By
the 1980s, thanks to
this regulated
distribution and the
existence of a large
free market with
affordable prices, it
could be said that Cuba
had achieved a degree of
equity unparalleled in
Latin America," said
Nova.
But in the late 1980s
and early 1990s, the
break-up of the Soviet
Union and the
disappearance of the
East European socialist
bloc, then Cuba’s main
political and economic
allies, again deprived
the country of its main
markets and the economy
went into free fall,
with a drastic impact on
the local standards of
living.
By 1993, consumption was
31 percent lower than in
1989, and gross domestic
product (GDP) had
plunged by 35 percent. A
package of adjustment
measures began to turn
the economy around in
1993, and by 2000 total
consumption had grown by
37 percent, according to
experts.
In order to cover their
needs, consumers must
now go to the free
farmers’ markets, which
sell fruit, vegetables,
grains, cereals, pork
and other foods of good
quality in the local
currency, pesos, but at
high prices.
Other essential goods
such as shoes, personal
hygiene items, household
appliances and
furniture, as well as
foods long since absent
from the ration book
system, are sold in the
government’s hard
currency shops (TRDs).
The TRDs only accept
convertible Cuban pesos
(CUC), the only hard
currency permitted in
the country, which the
state exchange bureaus (CADECAS)
will change for 25 Cuban
pesos or 1.25 dollars.
In the business sector,
however, the official
rate is one CUC to a
Cuban peso.
The domestic market,
which is completely
under state control,
includes shops for
agricultural products
with maximum prices
agreed between producers
and the government;
agricultural and
livestock markets; sales
on-site at market
gardens and hydroponic
farms; and neighbourhood
sales outlets and
kiosks.
At all these retail
outlets, quality,
assortment and stability
of supply tend to be
inferior, while prices
are the same or only
slightly cheaper than in
the free farmers’
markets and TRDs, which
are references for
prices even on the black
market.
In Nova’s view, "efforts
should be made to unify
all these markets and
seek agreements to
secure lower prices," as
part of a recipe which
should include the
elimination of "the ties
that hinder the
development of
productive forces."
He said this would
require "changes in the
relations of production"
to enable higher yields,
particularly in the
agricultural and
livestock sectors, and
progress "towards an
exchange rate in the
business sector that
would complete the
production circle."
Experts have indicated
that among the factors
that discourage food
producers are the
one-to-one exchange rate
for Cuban pesos and CUCs
in businesses, and the
lack of an exchange
market where they can
buy hard currency to
purchase imported
agricultural inputs and
equipment to allow them
to increase production. |
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