The rapprochement process that has been taking place between Cuba and the United States after the announcement of the re-establishment of diplomatic relations was made on December 17, 2014, is undoubtedly one of the events that has given rise to many questions among Cubans and people from around the world.
Cuba has ever since been living a new and decisive stage of its revolutionary process and, according to the analyst Faustino Covarrubias from the World Economy Research Center, the current period poses the greatest danger ever, hence a change of mentality and preparation are needed.
“We have to be very intelligent, because not only is the Cuban economy different compared to many years ago, but the Cuban society is too; it’s another generation,” Covarrubias said.
When questioned by The Havana Reporter about the challenges and opportunities posed by the process for the normalization of relations with the United States, Covarrubias noted that for any country this means establishing relations with the world’s largest economy, which remains in the lead despite the role currently played by China and Russia.
When explaining the new scenario, the expert on U.S. affairs used the example of the recent approval of the U.S. dollar in Cuba’s transactions with the U.S. and other countries which means that the island can now be part of a financial flow that had been banned until very recently.
He spoke about the value of the U.S. dollar, the main international financial instrument, which leads the world’s monetary reserves. More than 60 percent of them are in dollars, far ahead of the euro and the yuan.
Covarrubias added that the U.S. dollar also owes its strength to world financial transactions as 85 percent of these are undertaken using the dollar, while 70 percent of International trade uses this currency for its transactions.
Cuba, which has been isolated from the whole movement led by the International Monetary Fund and the World Bank, is now on the road to the normalization of trade relations. This entails great opportunities, but also big challenges that must be faced wisely, he stressed.
When referring to the opportunities he explained that we cannot forget that Cuba is an open economy that depends on relations and foreign financing, and even though it has very good quality medical services and certain technological advances in biotechnology and pharmaceutics, the island is a developing country.
The analyst also praised the priority that Cuba has given to paying off its debt, which creates a climate of confidence and opens possibilities for it to enter the world financial market and get credits from international economic organizations.
The announced interest of many countries and businessmen in investing in Cuba has been the biggest indirect benefit, all driven by the possible presence of U.S. capital in Cuba, Cobarrubias said.
It is very important that the Cuban authorities and Cubans in general do not let spontaneity get the better of the relations with the United States, because of what this might mean for national security and the country’s self-determination, taking into consideration that they are willing to offer anything, particularly large investments and in any sector, the analyst commented.
However, Covarrubias said that if we weigh up the challenges and the opportunities, we find more of the latter because of the importance for Cuba to access the international financial flow and enter the U.S. economy and the world economy.
“It is easy to say, but this is a big challenge, so it is necessary to trust the country’s capability to make the best use of the opportunities ahead and clearly identify the consequences that might result from what is known as the people-topeople contact, not only in economic and political terms but in social terns as well, he explained.
Cuba and the United States resumed diplomatic relations on July 20, 2015 and have taken the first steps on the long road towards the normalization of bilateral relations, with the economic and commercial blockade held against the island by Washington representing the main obstacle in this process.Share on FB Share on TT