The Cuban economy, besieged by multiple simultaneous crises, continues to make no decisive progress towards one of the economic commitments most often reiterated by its authorities: the reorganization of the exchange market.
Announced as imminent for 2025, the implementation of a floating exchange rate seems to have been suspended, caught between political promises, structural realities, and increasing social pressure.
From official enthusiasm to a waiting rhythm
During the IX Congress of the National Association of Economists and Accountants of Cuba (ANEC) -held last week- the Minister of Economy and Planning, Joaquín Alonso Vázquez, hinted that it will take a long time.
Although Prime Minister Manuel Marrero announced in December 2024 a deep reorganization of the currency market with the implementation of "a floating rate," the Minister of Economy has recently taken a much more cautious stance.
Exchange Rate Evolution
"Alternatives are being analyzed", stated Alonso Vázquez; "but the Government must minimize risks", he added without providing details.
He also acknowledged that there are already "defined actions for each stage," although he warned that "the risk is high."
“Any measures in this area must ensure that the exchange rate does not soar, which is very difficult in a context of currency scarcity and low commodity supply,” he emphasized, in statements captured by Cubadebate.
With these statements, the minister hinted at one of the key issues of the problem: without an increase in production and supply, any change in the exchange rate scheme is doomed to fail.
The current currency crisis is directly linked to "the lack of production and supply of goods in the country," he emphasized.
Three Rates and a Monetary Maze
The Cuban economy currently operates with at least three official and parallel exchange rates: one for legal entities (typically state-owned enterprises), another for private transactions, and a third informal rate, where most of the foreign currency actually circulates.
This plurality of rates, far from encouraging efficiency, creates a dangerous fragmentation.
"The dollar has become a mechanism of interconnection, which has resulted in a partial dollarization of the economy", the minister admitted.
He added that "to correct these exchange rate distortions, it is necessary to link the rates through currencies," an argument he used to justify the growing dollarization.
"We have no option but to move toward a partial dollarization, although the ultimate goal remains des-dollarization. We reiterate this", he emphasized.
The impact of this "distortion" is concrete: state-run companies like ETECSA or Consultoría Jurídica charge for services in foreign currency at a rate of 1 USD = 24 CUP.
Meanwhile, in banks and exchange houses (CADECA), the state buys foreign currency from the population at a rate of 120 CUP per dollar.
And in the informal market, where most real transactions take place, dollars are now being sold at an average of 378 CUP, according to the latest rate published by elTOQUE.
This disparity particularly harms salaried workers in the public sector and those without access to remittances, exacerbating economic inequality.
The coexistence of these rates has made the Cuban monetary system an almost impenetrable labyrinth.
A floating rate without real floating?
The proposal for a floating exchange rate by 2025 was one of the most notable announcements at the end of 2024.
According to the information released at the time, this would operate through CADECA and the banks, and its value would be updated daily.
However, several economists pointed out at the time the unprecedented -and potentially contradictory- nature of applying this model under the country's current conditions.
The economist Pavel Vidal, in statements collected by the independent media elTOQUE in the same month of December, warned that this would be the first time that Cuba, with a historically centralized economy, would attempt to implement a daily currency float.
Nevertheless, fundamental questions arose: How can a rate "float" if the only authorized actor in the foreign exchange market is the State itself?
For many analysts, rather than a genuine flotation, what is being proposed is "a pricing mechanism with some variability, but managed by the Government," according to the aforementioned source in another analysis published this same week.
The objective would not be the free formation of prices, but rather to compete with the informal market and attract foreign exchange that is currently circulating outside the institutional system.
Expert voices and alternatives outside the State
The economist Miguel Alejandro Hayes has been emphatic: "the floating exchange rate announced by Cuba will not succeed in replacing the informal foreign currency market."
In the same vein, Mauricio de Miranda -also cited by elTOQUE- pointed out that "a currency market does not have to be exclusively state-run."
In fact, in many countries, private exchange houses operate under regulation, pay taxes, and contribute to the formal economic ecosystem.
According to De Miranda, involving the private sector in currency markets could be a viable solution if clear rules are established and institutional operations are ensured.
"The main obstacle," he asserts, "is the vision of the State itself. The economic policy of the Cuban Government, for decades, has prioritized absolute control and monopoly over all economic aspects."
"Until that vision changes, any currency adjustment will run the risk of being just a mere mirage amidst the crisis."
Promises condemned to wait
The anticipated reorganization of the foreign exchange market in Cuba, far from being imminent, faces multiple structural, ideological, and technical challenges.
While the authorities reiterate that "the actions are defined," the population remains trapped in a monetary system that penalizes work in pesos and rewards access to foreign currencies.
The issue is not just the exchange rate, but an entire economic model that has yet to reconcile state control with efficiency, centralization with diversity, and planning with market reality.
Until that dilemma is resolved, everything seems to indicate that the promised floating rate will remain merely an illusion.
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