The Cuban economist Pedro Monreal warned on Wednesday that the circulation of 10,000 and 20,000 Cuban peso bills is not an economic solution, but rather evidence of a structural crisis: the Cuban peso has ceased to function as a unit of value for labor.
Monreal published on Tuesday his analysis titled "When a Bill is Worth Much More Than a Month of Work," in response to the announcement from the Central Bank of Cuba (BCC) to incorporate these denominations — the highest issued so far on the Island — starting this Wednesday.
The central argument of the economist is based on a striking comparison: the Cuban minimum wage is around 3,210 CUP per month, and the average state salary barely exceeds 7,000 CUP, which means that a single 20,000 peso bill is equivalent to almost three average monthly salaries.
"The 'technical solution' ends up prevailing over economic and political logic. When work loses its incentives, structural crisis becomes permanent," wrote Monreal on his X account.
The economist points out that in stable economies, the opposite is true: the highest denomination bill represents only a fraction of the average monthly income. As an example, he cites the 100-dollar bill in relation to an average income of about 6,000 dollars in the United States, or the 10,000 yen bill compared to an income of around 400,000 yen in Japan.
"When the highest denomination bill greatly exceeds the monthly salary, it usually reflects chronic inflation, monetary duality, or a dollarized circuit, not a payment system anchored in labor," he warned.
For Monreal, the gap is not a technical accident, but rather a reflection of who the Cuban monetary system is truly geared towards: "The monetary cone is aligned with a trade anchored in dollars—remittances, forex markets, and informal prices—not with a demand based on salaries and pensions."
The economist also questioned the scope of the package of 176 economic measures approved by the National Assembly in June, presented by Prime Minister Manuel Marrero Cruz.
According to Monreal, that package "manages the duality but does not tether the CUP to the results of work," as it proposes successive devaluations, currency exchanges, and greater partial dollarization without addressing the disconnection between the peso and labor income.
The president of the BCC, Juana Lilia Delgado Portal, justified the issuance of the new bills by stating that it responds to the "current conditions of prices and monetary circulation."
The 10,000 CUP bill features the image of Haydée Santamaría and is predominantly gray and green; the 20,000 CUP bill displays the image of Vilma Espín in yellow and brown. Distribution began in Havana and will gradually extend to the rest of the country.
The popular reaction on social media was one of irony and frustration. "I imagine they're now paying salaries every three months," wrote one user. Another phrase that circulated was: "Now we are almost Colombians."
The context worsens Monreal's diagnosis: this Wednesday, the dollar in the Cuban informal market reached 700 CUP, a new historical record, while the official inflation rate stood at 20.70% annually in July, although independent economists estimate it to be around 70% when including the informal market.
This is the second expansion of the monetary cone in less than six months: the 2,000 and 5,000 CUP bills began circulating on April 1, also as a response to the cash shortage. The basic basket in Cuba has been estimated at around 96,000 CUP per month, a gap of about 30 times the current minimum wage.
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