The Cuban regime assures that the so-called "Neighborhood Markets," state-run establishments that can be managed by small and medium-sized enterprises and other economic actors, must sell essential products at prices 15% to 30% lower than those in other stores in the country.
Marpessa Portal de Villiers, General Director of Merchandise Sales at the Ministry of Domestic Trade (MINCIN), stated this during an interview broadcasted by Canal Caribe, in which she provided new details about an initiative that the government presents as an alternative to lower the prices of essential goods amid the supply crisis.
"The neighborhood market is a project designed to provide the community with a range of essential products, both food and hygiene items," explained the official.
The planned food items include rice, sugar, grains, canned tomatoes, pasta, coffee, oil, powdered milk, chicken, eggs, fish, and wheat flour. Hygiene products such as soap, detergent, deodorant, and toothpaste are also included.
The initiative was regulated by the , published on August 4 in Official Gazette No. 64 and in effect since the 11th of that month.
The model allows for the management of state network establishments—including bodegas and markets—to be awarded through bidding to companies, small and medium-sized enterprises, cooperatives, self-employed workers, and even foreign investment modalities, while the State retains ownership of the properties.
To attract managers, the authorities have accompanied the project with tax benefits. The includes incentives for operations related to the program, while some tenders also offer up to two years of rent-free duration, a period that can be extended when the manager makes investments in the establishment.
The official bet is that these facilities eventually translate into savings for the consumer.
"[Prices] should be around 15 to 30% in relation to the rest, I repeat, of the prices in the markets being traded," stated Portal de Villiers.
The official stated that there are currently 30 establishments operating under the project in Pinar del Río, Artemisa, Havana, Matanzas, Camagüey, Granma, Santiago de Cuba, and Guantánamo. Havana, Camagüey, and Guantánamo would each have seven.
However, the expansion of the model occurs while the State increasingly turns to the non-state sector to try to reactivate establishments that have remained closed, understocked, or with limited services for years.
In August, Cienfuegos handed over the management of 47 butcher shops to private individuals, which is equivalent to 68% of those in the province, after a lack of products left many practically nonoperational.
That same month, Ciego de Ávila put six warehouses up for auction to incorporate them into the "Neighborhood Market" project.
The formula has also been extended to Villa Clara, where a state-owned company sought private managers to operate 21 commercial premises, while in September Santa Clara called for economic actors to manage 16 bodegas.
The scheme reflects a transformation of the deteriorated Cuban commercial network: the State retains ownership of the establishments, but transfers their management and part of the necessary investment for their recovery to other economic actors.
Authorities assure that the managers will be required to adhere to the conditions of the program. The infraction regime includes penalties for failing to comply with the agreed prices, committing irregularities in weighing, or refusing to accept electronic payments, a practice that Portal de Villiers acknowledged as "something very common lately."
The “Neighborhood Markets” are also arriving at a time of deep crisis in the state food distribution system, characterized by delays and reductions in the regulated food basket and by the increasing reliance on private markets, whose prices are beyond the reach of many salaries and pensions.
The big question is, therefore, whether the tax and leasing advantages granted to the managers truly translate into available products and prices 15% to 30% lower, as the government now claims, in an economy affected by scarcity and loss of purchasing power.
Filed under: