Havana, Cuba is well known for it’s great cigars, exotic night life, beautiful women and old charm, but there are more….. Cuba has a territorial tax system for foreigners that are resident in the country. However, ordinary Cubans are taxed on their world wide income.
Faced with financial ruin, one of the last communist countries in the world is now undergoing a new revolution, Capitalism is coming back to Cuba…
The extremely low salaries and cost level adds to the attraction. The average salary for state employed Cuban’s is about USD 19 per month. An average pension is USD 5 per month.
The saying goes in Cuba:
“The government pretends to pay us and we pretend to work”.
To motivate Cuban’s to work can be a challenge according to new business owners.
The salaries is not enough to survive, and food is rationed so the state provide basic food on quotas to favorable prices, and traditional health care is free. However, pharmaceuticals are in short supply, but foreigners are given preference before ordinary Cuban’s here as well because they have money and can pay. Many Cuban’s receive money almost monthly in support from their relatives abroad (mostly in the US) that escaped the revolution.
Street view of old Havana, Cuba. Courtesy of Wiki Commons.
A large privatization program has been underway in Cuba for some time. The state has begin giving back the homes taken during the revolution to the people, and all types of small businesses have been / are being privatized.
However, there are still travelling restrictions for ordinary Cuban’s and the media and internet use are strictly controlled by the state. Dissidents are not tolerated.
As it was in Eastern Europe at the fall of communism most buildings and infrastructure incuding public transportation systems are “run down” and in need of extensive renovation. The state is broke and the Cuban’s have no savings.
The key to future investments are in the hands of the more than a million displaced Cuban’s abroad, many living in the Miami area of the United States. They have the money and could come back to Cuba in the future.
Havana city faces a serious drinking water shortage due to gross neglect of the infrastructure for decades. In addition the United Nations Environmental Program (UNEP) warns that water pollution in Cuba is a serious concern. The standard practices throughout the revolutionary period of virtually non-existent pollution limits, and detrimental agricultural practices, seem to have taken a significant toll on the Cuban environment. Cuban bays are widely recognized as being polluted.
New luxury hotels are planned on Cuba to attract foreigners. This hotels will have their own clean water systems.