We can't solve problems by using the same kind of thinking we used when we created them Albert Einstein With the beginning of the new year, we’re making lots of plans on the personal level, and among them, one is surely common: prosperity.
The common denominator, in this regard, means having access to greater resources, including money, to satisfy growing needs and enjoy more quality of life, which, with few exceptions, can only come from work, with individual and collective efforts directed toward developing the economy.
As has been reiterated by the President of Cuba’s Councils of State and Ministers, Miguel Díaz-Canel Bermúdez, this battle continues to be the priority task and also the most difficult, for which mobilizing all potential to produce more, more efficiently and effectively, is “the only way that will allow us to grow, and overcome climate impacts and financial tension.”
Once again, modest growth is projected for the economy this year, based on fulfilling plans, and keeping necessary financing and resources available balanced, according to experts. But this tactic is important over time, seeking to generate the conditions that will guarantee greater growth in coming years, while projects and programs that will continue to be expanded, and others to be added, are outlined in the National Economic and Social Development Plan through 2030.
Thus, if the knots that hold back productive forces are untied; if reserves are identified and fully utilized; and every one does what is required in any position, including those in leadership, at the end of 2019, the balance sheet will, at least, reflect the results forecast in the most recent session of the National Assembly of People’s Power.
ENGINES OF THE ECONOMY
There is much to do, but the direction in which we must move to accomplish the goals established is well defined. It is no accident that the strategy designed for the 2018-2019 sugar harvest has already shown results. Before the end of December, production during the “little” harvest surpassed projections, with a record set.
Some 250,000 tons of sugar were produced efficiently, setting the pace for the season, with a total of 1,760,000 tons projected. Reaching this goal would be a great success for agricultural, industrial, and support workers in this strategic sector of the economy, not only given the production of sugar, but also by increasing income from animal feed and derivatives, plus generating electricity with biomass.
The current campaign must establish sustained growth in sugar production, which implies the need to create the conditions needed for the adequate completion of agro-technical activities that allow the productive cycle to function.
EFFICACY AND EFFICIENCY IN THE INVESTMENT PROCESS
These indicators do not always go hand-in-hand, and there are even those who disdain or ignore the implications of each one. In those situations, I always remember one of my classes with Dr. Hugo M. Pons Duarte, in which he defined economic efficiency as the "expression of rationality determined by the obtaining of increasingly greater results with a lower expenditure of resources..." and efficacy as "the degree to which objectives, goals, and ends are met, accomplished through the plan at different levels and in different scenarios.”
With these specifications, there is no doubt that, in 2019, it is imperative to achieve both in the investment process, in order to cover the costs of financing with earnings, and support prioritized plans.
Toward this end, the State Budget approved in December by the National Assembly of People’s Power allocated more than four billion pesos to principal social programs and investments that, I would add, imply an increase in constructive capacity in terms of human and material resources, for example.
In this way, supported are construction, preservation, and repair of housing; the recovery and development of the country’s railway system; in addition to highway and infrastructure works, including those underway within the Mariel Special Development Zone.
Investment continues in wind farms and photovoltaic parks, and this year should see those related to generating electricity from biomass advance, to contribute to transforming the country’s energy profile and increasing the use of renewable resources, which has a double purpose. Beyond the economic advantages, this effort is part of the comprehensive state plan to confront climate change, known as Tarea Vida, which is being gradually implemented.
It should be emphasized that some of these projects are being undertaken with various forms of foreign investment, although the portion of the total needed is still insufficient. Growth in this arena is among the country’s priorities, especially in sectors that generate benefits and are indispensable to economic development.
Hotel capacity has continued to increase, and this year, some 4,000 new rooms will be added, with emphasis on the tourist destinations of Havana, Varadero, and keys along the northern coast from Villa Clara to Holguín.
This strategic sector, one of the most dynamic and of greatest impact on the economy, is committed to repeating this year the record number of international visitors and strengthening conditions that allow for lower expenses, greater savings, and substitution of imports with domestic products.
The foundations on which the 2019 plan is based require that national industry be maximized, a fact defined in the Party's program documents and essential to the new economic and social model we are building.Substituting imports, based on the greater use of existing capacity in the country, and increasing productive linkages within the economy in general, should be coupled with greater rationality in import decisions and other foreign exchange expenditures. Of course, quality and price of local products cannot be a barrier, rather they should be a reflection of positive experiences and benefits for all.
The broad policy to be implemented beginning this year for the recovery of the nation’s housing stock, within a decade, has been much awaited, in its first five years prioritizing damage caused by extreme weather events and cases of families living in precarious conditions.
The effort looks to be intense and is based on two fundamental axes: exponential growth in local production of building materials and popular participation, although a portion of buildings will be erected with different pre-fabricated elements produced by state enterprises.
Housing in figures:
929,695 housing deficit
527,575 homes to be built in the next 10 years
402,120 homes to be repaired in the next 10 years
The efficient management of inventories, with a view toward utilizing these as fully as possible, is among the central tasks set forth in the plan, with no beating around the bush, as figures from the last month of 2018 show.
Existent within the country are known inventories worth 2.4 to 2.5 billion pesos, representing 25% of the Gross Domestic Product (GDP) at current prices.
Thus, reducing this proportion of inventory to GDP by 2% would contribute 400 million dollars to the economy.
OBLIGATIONS AT HOME AND ABROAD
Documents consulted reveal the urgent need to increase export earnings and foreign investment, as well as access to external resources through medium and long-term credits.Despite growth in foreign investment, for several reasons this is still far from the position to be occupied with respect to the nation’s total investment, and the intention this year is to eliminate factors of a subjective and organizational nature that limit exports, the availability of credit, and the attraction of foreign capital.It will also be important for the economy to increase revenue from sales abroad and guarantee their payment, in addition to the promotion and diversification of exports of goods and services, which translates, for example, in rescuing traditional lines and identifying new products. Debates in the National Assembly’s standing committees during the Ninth Legislature’s last period of ordinary sessions helped to define what today constitutes a requirement to fulfilling the plan and laying the foundations which the economy requires in discipline and organization: the fulfillment of projected contributions to the State Budget.To do so, it is essential to increase effectiveness in the use of inventories; achieve projected returns on investments; use accounting as a management tool; and exploit reserves in general.A special call is to increase efficiency in the collection of taxes. Likewise, rationality and control in the use of material and financial resources are needed, in addition to the efficient management of accounts receivable and payable.
COMPUTERIZATION OF SOCIETY
The Cuban government will continue to advance in its policy of computerizing society. Due to its scope, this task occupies a special place in the implementation of our new economic and social model.Considered a multi-faceted process undertaken for economic, ideological, and social purposes, it should also facilitate the population’s participation in decision-making, as reiterated by Cuban President Miguel Díaz-Canel Bermúdez.
Income to be generated from territorial taxes for economic and social development of municipalities amounts to 1.358 billion pesos, reflecting projected growth of 15%. The goal is to achieve a balance that allows for the expansion of productive projects, which create income, jobs, linkages, and other benefits that contribute to greater economic growth, without neglecting social programs.
To achieve a growth rate of 1.5% in the economy in 2019, it is imperative to work purposefully, in a coordinated fashion, without resorting to empiricism, and with economic management bodies playing a leading role.This year, gross income should rise by 4%, with the state sector predominating (85%), confirming its principal role in the economy. The contributions of non-state management forms increase by 16% and represent 13.3% of total income.Increases are estimated in a number of sectors of the economy that have a direct impact on production: agriculture, livestock ranching and forestry, the sugar industry, construction, commerce, transport, and communications.This year, 5.41% of the energy generated in the country must be generated with renewable sources.
2019 State Budget Law.
Reports on the proposed 2019 State Budget from the National Assembly’s Standing Committees on Economic Affairs, and Constitutional and Legal Affairs.
Speech by Miguel Díaz-Canel Bermúdez, President of Cuba’s Councils of State and Ministers, closing the Second Period of Ordinary Sessions of the National Assembly of People’s Power Ninth Legislature.