Friday, November 4, 2011

Cuba Announces Major Shift in Private Property Ownership

For the first time since the early period of the Cuban Revolution, Cubans will now be able to legally buy and sell their own homes at their own prices. The new law, which will go into effect on November 10th according to state-owned newspaper Granma, is the result of the reform package announced at the close of last April’s Sixth Communist Party Congress. While limits on the real estate market will continue (the law only applies to Cuban citizens, and restricts people to a maximum of one permanent residence and one holiday home), the announcement represents a major shift in economic policy for the Cuban government. In the past Cubans could only swap their homes with government approval, through a complicated and highly bureaucratic procedure.

In spite of the sweeping nature of the reform, the jury is still out on the nature of its impact on the island nation. The New York Times quotes Cuban-American relations scholar Pedro Freyre, who claims that the new property law amounts to nothing less than a rejection of state socialism. “To say that it’s huge is an understatement. This is the foundation, this is how you build capitalism, by allowing the free trade of property,” Freyre said.  

Others disagree. The government, for instance, has repeatedly insisted that such economic reforms amount only to tweaking the system, with the intention of creating “More revolutionary and better socialism.”

The Wall Street Journal notes that the changes “are a far cry from former Chinese leader Deng Xiaoping's call to the Chinese that ‘to be rich is glorious,’” often seen as the beginning of the shift towards a market  economy in that country.  The paper cites University of Miami-based Cuba expert Jaime Suchlicki as saying that the positive impact of the reforms will be limited. "There are not many people who have money to buy houses, and there are not a lot of houses to buy," Suchliki claims.

Reuters reports that state figures put the housing shortage at 600,000 units, and adds that many on the island live as tenants on other peoples’ property. With the new incentive to sell, the shortage may result in some tenants having difficulties finding new housing. According to the NYT:

“For example, if two families are sharing a home and one holds what currently amounts to Cuban title with limited rights, the new law says that the titleholder can sell and the tenant family will eventually have to move. Many Cubans say they are afraid that the market system will leave them in the lurch.”

More from the Washington Post, the BBC, TeleSur, and Cubadebate.


News Briefs

·         With Nicaragua and Guatemala preparing to elect presidents this Sunday, Rachel Glickhouse and Mark Keller of the Americas Society offer a tidy side-by-side comparison of the two elections, providing a summary of the major issues at stake in both cases. In Guatemala, the frontrunner status of Gen. Otto Perez Molina (recent polls show him leading 58.5% to 41.5% over rival candidate Manuel Baldizon) has human rights advocates concerned that his military past will give undue influence to the armed forces in the country. In Nicaragua, analysts have forecasted a likely win for incumbent Daniel Ortega, despite questions over the legality of his candidacy.

·         The Washington Post also takes a look at Ortega’s bid for office, noting that many of his supporters view their vote not as an endorsement of him as a candidate, but as a show of support for the economic policies he represents. According to one rural Ortega supporter who has received substantial support from the government, “He’s like a piƱata. The money keeps coming.” For more on the Nicaraguan election, and on concerns about Ortega skirting the democratic process, see this excellent report by WOLA’s Maureen Meyer.

·         Honduras’ La Tribuna reports that 176 police officers have been detained and are under investigation for a myriad of offences.  The BBC notes that the move comes after President Porfirio Lobo saw heavy criticism for the release of four policemen suspected of murdering two students.

·         Meanwhile, InSight Crime’s Hannah Stone takes a look at the government’s recent decision to use the army for policing, which doesn’t seem to have made much progress. As Stone argues, it is unlikely that this measure will significantly restore the rule of law in a country which is “fast becoming the principal cocaine handover point for Colombian and Mexican traffickers.

·         La Republica has the latest on the first major corruption scandal of Peruvian President Ollanta Humala’s term, which centers on allegations that one of his vice presidents abused his office. The paper reports that the Peruvian Congress is continuing to investigate Vice President Omar Chehade, and has taken him off of a special commission tasked with investigating corruption during the previous administration.

·         The Americas Quarterly blog examines the Peruvian government’s efforts to mediate a conflict between an American mining company and the local community over a $4.8 billion gold mine in the northern highlands of the country. As the posts’ authors note, the incident represents Humala’s efforts to fulfill a campaign pledge to emphasize social inclusion.

·         Although Colombian President Juan Manuel Santos remains widely popular in his country, the distance he has placed between himself and ex-president Alvaro Uribe is causing a rift in the ruling Party of the U. El Tiempo describes a growing division between Santos-aligned party members and the minority who still stand with Uribe. According to El Tiempo, the latter group is considering pushing for a more pro-Santos politician to become party leader. Colombia Reports and CMI Noticias report that the party has called for the two to meet in order to cool the rising tensions.

·         The Associated Press reports that a massive crackdown on three unlicensed radio stations occurred in Venezuela on Thursday. The owner of one of the affected stations, Kalor 92.1 FM, claimed that about 50 armed soldiers confiscated the station’s broadcasting equipment yesterday. According to the wire agency, the country’s government shut sown 34 radio stations last year, claiming that the majority of them had failed to revise their registrations or had allowed their concessions to expire.

·         The Washington Post compares the current political turmoil caused by the debt crisis in Greece to two separate case studies in Latin America: the early 2000s debt crises of Uruguay and Argentina. The paper claims that Argentine default of 2001, and its chaotic aftermath, is more in line with the economic forecast of Greece than the Uruguay example.

·         The latest issue of the Economist has been published, and focuses on Brazil’s efforts to use offshore oil reserves to fuel economic development and the risks associated with it. The issue also examines Nicaragua's elections, the issue of currency controls in Argentina and the recent cancer diagnosis of Brazilian ex-president Lula da Silva.