Wednesday, August 12, 2020
Home Business Cuba Studying Potential Use of Cryptocurrency to Boost its Economy

Cuba Studying Potential Use of Cryptocurrency to Boost its Economy

Cuba's inefficient state-run economy is facing a crisis due to a sharp decline in Venezuelan aid, lower exports

Cuba’s Communist government said on Tuesday it was studying the potential use of cryptocurrency as part of a series of measures to boost its economy amid a deepening crisis exacerbated by U.S. sanctions.

Cryptocurrency, which allows financial operations to be carried out anonymously, has been used in the past to get around capital controls. Cuba’s top ally Venezuela introduced a cryptocurrency last year aiming to avoid U.S. sanctions and weather hyperinflation, although it never properly got off the ground.

Cuba’s inefficient state-run economy is facing a crisis due to a sharp decline in Venezuelan aid, lower exports and the tightening of the decades-old U.S. trade embargo under President Donald Trump.

The new measures, announced on a roundtable on state-run TV by President Miguel Diaz-Canel and his government, will raise income for around a quarter of the population and deepen market reforms of one of the world’s last Soviet-style command economy’s started by the island nation’s previous president, Raul Castro.

Cuba, Cruptocurrency, Economy
Cuba’s Communist government said on Tuesday it was studying the potential use of cryptocurrency. Pixabay

The aim is to raise national production and demand in order to boost growth as U.S. sanctions target tourism and foreign investment. Diaz-Canel, working to establish his legitimacy after assuming the presidency in April 2018, said the government was working on the details of the implementation.

“We are studying the potential use of cryptocurrency … in our national and international commercial transactions, and we are working on that together with academics,” Economy Minister Alejandro Gil Fernandez said.

The most popular measure in the new package will likely be the hikes in some pensions and wages for workers in public administration, social services and state-run media, bringing the medium monthly wage in those sectors up to the equivalent of $44.5 from around $25 previously.

Many Cubans say the measure still will not be sufficient to breach the gap between salaries and the cost of living.

Also Read- Research: Obese Adolescents More Likely to Experience Bullying

Nonetheless it should boost purchasing power, as long as inflation is kept in check.

“It’s not ideal, but it’s an advance,” said Pavel Joaquin Hernandez, 46, a general practitioner who will go from earning the equivalent of around $40 per month to $64.

Cuban economist Omar Everleny said the raise was crucial given how demotivated workers were, with many emigrating.

“For the first time, (the government) is linking the fact that everything can be achieved if workers are motivated,” he said.

Cuba, Cruptocurrency, Economy
Cryptocurrency, which allows financial operations to be carried out anonymously, has been used in the past. Pixabay

Gil Fernandez said the government was also broadening a series of measures aimed at decentralizing and thus improving state-run company performance and stimulating local production, substitution of imports and increasing exports. For example, he said, financial service companies would be established to provide cash in the face of opportunity more quickly than the centralized planning system.

The government would also expand a system allowing some companies to keep a percentage of the hard currency they earn in order to reinvest it immediately rather than have to apply for credit.

State companies, agricultural entities and other economic actors that supply a growing number of firms in the Mariel Special Economic Zone, a project resembling China’s first capitalist oasis, would receive a percentage of sales in hard currency, Gil Fernandez said.

Also Read- Video-streaming Giant YouTube Bans Hacking Videos; Content Creators Puzzled

The government was also studying how to allow the growing number of small private businesses to export through the state-run businesses, he said. (VOA)

STAY CONNECTED

18,958FansLike
362FollowersFollow
1,781FollowersFollow

Most Popular

Bollywood Blends In Janmashtami Colours

On the occasion of Janmashtami, celebrities took to social media to extend greetings to their fans, giving a glimpse of how they are celebrating...

5 Reasons Why More Online Casinos Accept Indians

Gambling in India is as old as India itself, so it is not surprising that more and more online casinos accept Indian punters, looking...

3 Types of ULIP Plans in India that Gives Guaranteed Returns

In today’s competitive world, there are plenty of saving and investment choices that decide your future financial wellbeing as well as that of your...

Mouthwash Use Can Reduce Covid Transmission Risk

In the fight against the novel Coronavirus, a team of German scientists has claimed that Sars-Cov-2 viruses can be "inactivated" using commercially available mouthwashes. According...

Increased Foreign Investments into India’s Gaming Market

There has been an increase in gaming activities in India since 2016. This has led to growth in the gaming sector of India. This...

Actress Madhuri Dixit Shares Her Bollywood Journey With Fans

Actress Madhuri Dixit-Nene went down memory lane and shared how she was bitten by the acting bug. "This day back in 1984 I started my...

This Survey Reveals India’s “Consciousness” Towards Diet and Nutrition

As many as 97 percent Indians are aware of the essential nutrients and micro-nutrients required for their body, of which 60 percent 'rarely' or...

Heavy Cigarette Smoking Leads To Complex Health Issues: Study

Each cigarette smoked a day by heavy smokers increases the risk of contracting several diseases by more than 30 per cent, warn researchers. The study,...

Recent Comments