CubaA is a communist province and all its assets are nationalised and are therefore collectivist. Capital investing and monetary values of the goods are capable to blessing by the authorities. In 2009, Cuba ranked 51 with an HDI of 0.863 ( UNDP 2009 )
GDP GROWTH RATE
Below given figure clearly illustrate that the economic system in Cuba was affected by planetary downswing though it is a closed economy.2008 was bad because of two natural catastrophes that affected the island and besides the planetary downswing consequence that spilled over.
GDP: $ 111.1 Billion ( hypertext transfer protocol: //www.cia.gov/library/publications/the-world-factbook/geos/cu.htm )
Inflation Rate
Inflation rate of the state has been increasing since the catastrophe took topographic point.
SECTORS OF ECONOMY
Like India the chief driver sector of activity in Cuba is service sector.It contributes more than 70 per centum to GDP in 2008 and employed 60 per centum of population ( Emporiki Bank, 2010 ) . The importance of the service sector is chiefly related to the development of touristry in the last decennaries
CubaA?s industries are chiefly agricultural merchandises and cement. Cuba has immense militias of mineral resources. The export of Ni is the chief beginning of income of state. ( Beginning: hypertext transfer protocol: //www.globaltrade.net/international-trade-import-exports/m/c/Cuba.html )
Cuba ‘s agribusiness is chiefly based on sugar and sugar cane ( Production of more than 12.5 bn metric tons of sugar yearly ) , and represents one tierce of the cultivated land ( Emporiki Bank, 2010 ) .
Presently, the economic system has following major beginning of grosss:
Nickel.
Tourism.
Remittances.
Sugar.
Foreign investings.
MONETARY Policy
The Cuban pecuniary system has double currency i.e. -the Cuban peso and the exchangeable peso, which is a beginning of concern The exchange rate at Cuban exchange ( CADECA ) for investors is 24 Cuban pesos for each exchangeable peso, whereas the official exchange rate for foreign corporations is 1 Cuban peso for one exchangeable peso.
Table 1. Cuba: currency exchange rates, 2010 Population and tourers
( CADECA )
Enterprises and Institutions
( Official )
Cuban peso/convertible peso
24
1
Convertible peso/US dollar ( B )
0.92 ( a )
0.92
Cuban peso/US dollar ( B )
22.08 ( a )
0.92
( Beginning: Cuban Monetary and Financial Jigsaw Puzzle ( ARI ) By Pavel Vidal Alejandro )
Foreign Trade POLICY OF CUBA
Cuba is merchandising with different states and has rank at different trade organisations
Latin American Association of Integration ( ALADI ) . Trade with these states is more than 80 % of entire Cuba exchange with Latin America.
ACP ( Africa-Caribbean-Pacific ) Group
CARIFORUM, an bureau in the Caribbean responsible for guaranting good dealingss with European Union.
Member at WTO: But does non belong to IMF and World Bank.
( Beginning: hypertext transfer protocol: //embacu.cubaminrex.cu/Default.aspx? tabid=2804 )
MAIN FOREIGN Trade PRODUCTS
The bulk of Cuban export merchandises are:
Sugar 32 % ,
Nickel 27 % ,
Tobacco 14 %
Lobsters 6 %
( Beginning: hypertext transfer protocol: //www.economywatch.com/world_economy/cuba/export-import.html )
All of these sums to 80 % of the entire exports in the state. However, a new line of exports has emerged which includes merchandises from Fe and steel industries, pharmaceutical biotech industries every bit good as fresh citrous fruit fruits and dressed ores. Cuba is progressively going really celebrated for its pharmaceutics and modern biotech companies and exports.
On the other manus, imports are more than 75 % of the trade exchange, with highest per centum being that of fuels and lubricators 22 % so foodstuffs 13 % , follwed by machinery and equipment 17 % plus chemical merchandises with 6 % ..
( Beginning: hypertext transfer protocol: //www.economywatch.com/world_economy/cuba/export-import.html )
Exports
“ Cuba exported goods which earned them more than $ 3 billion of foreign exchange in 2009.This was manner lower than twelvemonth 2008 figure of over $ 3.5 billion. Cuba largely exported sugar, Ni, baccy, fish, medical merchandises, citrous fruit fruits and java. Its major exporting spouses were:28 % to Canada, 27 % to China, and about 5 % to Netherlands. “ ( Beginning: hypertext transfer protocol: //www.economywatch.com/world_economy/cuba/export-import.html )
Imports
“ Cuba ‘s imports have been worsening from a high of $ 14 billion in 2008 to $ 11 billion about in 2009. The island state ‘s imports chiefly comprises of crude oil, nutrient merchandises both natural and processed, machinery for industry and farm and equipment and chemicals. Cuba ‘s major importers are Venezuela around 30 % of entire imports, China ( 12 % ) , Spain ( 10 % ) , Canada ( 6.4 % ) , the US ( 6.3 % ) and Brazil ( 4.6 % ) . ”
( Beginning: hypertext transfer protocol: //www.economywatch.com/world_economy/cuba/export-import.html )
Imports AND EXPORTS
( Beginning: Cuba, The Sleeping Caiman of Caribbean by Tamilla Gamez Garcel, Oct 2010 )
If we can see from the figure that after 2008 the imports have increased and exports have declined due to diminish in demand and so the current history shortage has increased.
( Beginning: Cuba, The Sleeping Caiman of Caribbean by Tamilla Gamez Garcel, Oct 2010 )
Cuba ‘s chief export state spouses are: Canada, China, Spain and Netherlands
( Beginning: Cuba, The Sleeping Caiman of Caribbean by Tamilla Gamez Garcel, Oct 2010 )
CubaA?s import chief spouses are Venezuela, China, Spain and Canada.
(
( Beginning: Cuba, The Sleeping Caiman of Caribbean by Tamilla Gamez Garcel, Oct 2010 )
CubaA?s imports have been increasing from 4.8 million US dollars in 2003 to 14.5 million USD in 2009 while exports have merely increased by 2 million USD. ( ( Beginning: Cuba, The Sleeping Caiman of Caribbean by Tamilla Gamez Garcel, Oct 2010 )
( Beginning: Cuba, The Sleeping Caiman of Caribbean by Tamilla Gamez Garcel, Oct 2010 )
Unemployment
Unemployment in Cuba is really low which is merely about 1.6 per centum in 2008 ( ( Beginning: Cuba, The Sleeping Caiman of Caribbean by Tamilla Gamez Garcel, Oct 2010 )
Cuba has given the right to its citizens of cosmopolitan entree to the educational and wellness systems. Cubans are besides provided with a monthly basic nutrient basket called as month rationing which is undergoing alteration. Irrespective of this the economic state of affairs is still unsure.
( Beginning: Cuba, The Sleeping Caiman of Caribbean by Tamilla Gamez Garcel, Oct 2010 )
Tax Policy
The rate of income revenue enhancement ( personal ) varies between 10 per centum ( for individuals with income of less than US $ 2,400 per twelvemonth ) and 50 per centum ( for those with income of more than US $ 60,000 per twelvemonth ) .
( ( Beginning: Cuba, The Sleeping Caiman of Caribbean by Tamilla Gamez Garcel, Oct 2010 )
Family money orders from abroad are exempt from the revenue enhancement ( Servicios Financieros, 2010 ) .
The construct of a gross revenues revenue enhancement does non be, except in the country of existent estate purchases ( i.e. stomp duty revenue enhancement ) , where a charge of 2 per centum is levied since 1996 ( Servicios Financieros, 2010 ) .
( ( Beginning: Cuba, The Sleeping Caiman of Caribbean by Tamilla Gamez Garcel, Oct 2010 )
Foreign Investment Laws
Law 77
The jurisprudence allows remittal of net incomes by foreign companies to their place states and there will be no expropriation for these companies without compensation.The jurisprudence allows for transferability of ownership to other foreign investors and besides provides them protection against claims of 3rd parties.
In Cuba three signifiers of foreign investing are allowed:
1.International association contracts,
2.Joint ventures, and
3.Fully owned by foreign companies.
( Beginning: Cuba, The Sleeping Caiman of Caribbean by Tamilla Gamez Garcel, Oct 2010 )
For joint ventures, there is no restriction to foreign ownership i.e. the foreign companies can have 100 per centum. However this has to be done in the signifier of set uping a subordinate of the several foreign company in Cuba or the other manner is to make a separate Cuban company to run the concern in Cuba.
Law 77 besides mandates the procedure of dialogue and blessing by the state before foreign investing is authorized to be deployed in the state. Investings of 1 ) more than US $ 10 million, 2 ) which involves 100 per centum foreign ownership,3 ) where a foreign state is involved straight, 5 ) those investings which require natural resources, and 6 ) those investings where either government-owned belongings or undertakings which are involved in certain notified particular sectors, such as transit, substructure, communicating etc which require the blessing of the Council of Ministers ‘ Executive Committee ( Ashby, 2005 ) .
All other investings apart from the above mentioned should be approved by a agency created by the Council of Ministers, Govt Of Cuba
To heighten FDI in Cuba, Law 77 helps in the constitution of duty-free zones and industrial Parkss which are unfastened to foreign investing and will be given some revenue enhancement inducements.
Law 77 allows foreign nationals/foreign companies to get, or ain or take on rental residential, office composites and other rights over Cuban existent estate.
Freedom for the concern
“ Harmonizing to the 2009 Index of economic freedom, Cuba ‘s economic freedom mark is 27.9, doing its economic system one of the universe ‘s least free, in front of merely Zimbabwe and North Korea. “ ( ( ( Beginning: Cuba, The Sleeping Caiman of Caribbean by Tamilla Gamez Garcel, Oct 2010 )
This mark clearly states that making concern in Cuba is badly hampered by legion institutional failings, corruptness, bureaucratism and high handed nature of province.
Cuba ‘s economic freedom is limited by the
High income revenue enhancement of 50 per centum
Fringy corporate revenue enhancement rate is 30 per centum ( 35 per centum for companies with wholly foreign capital ) which is rather high
Government outgos is really high and represents the 72,6 per centum of the GDP
Restriction of FDI to joint 51 ventures activities and a series of complex and arbitrary ordinances ( Index of Economic Freedom, 2009 ) .
The authorities besides maintains rigorous capital and exchange controls.
( Beginning: Cuba, The Sleeping Caiman of Caribbean by Tamilla Gamez Garcel, Oct 2010 )
TRANSPORTATION INDUSTRY
If we look at transit industry in Cuba, Cuba is ranked 73 in figure in footings of transit by roads.
( Beginning: hypertext transfer protocol: //www.photius.com/rankings/transportation/roadways_2010_0.html )
The urban theodolite system is deriving importance to ease mobility particularly in metropoliss. Approximately 5,400 coachs, 45 riders, will be acquired and be in operation within the following five old ages.
( Beginning: hypertext transfer protocol: www.photius.com/rankings/transportation/roadways_2010_0.html )
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Driving side of the route & gt ; Left or right
Right side
Highways & gt ; Paved
29,820 kilometer
[ 27thA ofA 113 ]
Highways & gt ; Entire
60,858 kilometer
[ 34thA ofA 118 ]
Roadss, entire web & gt ; km
60,856 kilometer
[ 55thA ofA 172 ]
Roadways & gt ; Paved
29,820 kilometer
[ 6thA ofA 81 ]
Roadways & gt ; Entire
60,858 kilometer
[ 6thA ofA 85 ]
Roadways & gt ; Unpaved
31,038 kilometer
[ 6thA ofA 79 ]
Vehicle copiousness
3.26 per square kilometer
[ 81stA ofA 141 ]
( Beginning: hypertext transfer protocol: //www.nationmaster.com/country/cu-cuba/tra-transportation )
Road transit: Cars and Taxis
Cars: In Cuba, autos are in private owned and are by and large old carswhich were bought before the 1959 revolution. Some vehicles have been bought from from Eastern Europe, such as Lada from the former USSR and other states, and there are Government/tourist autos normally Asian/Western European-built autos from 1990 onwards.
