By Marc Frank
HAVANA, Jun 2 (Reuters) – Cuba approved a reform that includes a long-sought legal status for private companies that began operating decades ago under the title of “self-employed,” local media reported on Wednesday.
Senior officials said that for months they had been planning changes to resolve regulations so that state-owned companies, cooperatives and businesses could operate on equal terms in the country.
The Council of Ministers agreed to the measure in its last session behind closed doors, state media reported, without offering details of when it will become law.
The reform would include legal status for the thousands of private sector businesses from restaurants and garages to construction shops and beauty salons, and for cooperatives.
“With this decision we are approving how to order the actors that intervene in our economy, which goes beyond the simple recognition of any of them,” said the leader of the Communist Party and Cuban president, Miguel Díaz Canel.
Unlike China and Vietnam, countries ruled by their Communist Parties, Cuba has been slow to implement market reforms in its Soviet-style economy.
But the government has accelerated the pace of a severe economic crisis and shortages of food, medicine and other things that it attributes largely to US sanctions and the pandemic, although it also admits the failure of the reform.
Still, Prime Minister Manuel Marrero Cruz emphasized that the state will continue to be the dominant economic actor, insisting that “we are not privatizing the economy,” according to the report.
Private farmers and cooperatives have operated for decades in Cuba in agriculture. Meanwhile, the “self-employed” sector, which includes companies, their employees, merchants and others like taxi drivers, has expanded over the past decade to include more than 600,000 workers.
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Thousands more work in non-farm cooperatives, a new category allowed since 2012. The authorities had suspended the issuance of new licenses for such cooperatives, but under the new reform they will begin issuing them once again.
In total, the private sector now represents around 13% of the workforce of six million people.
Oniel Díaz, co-founder of private business consultancy AUGE, said the approval indicated that further expansion of the private sector was on the way, but could still take a while.
“The wait continues,” he wrote in a tweet.
(Reporting by Marc Frank. Additional reporting by Sarah Marsh. Written by Nelson Acosta .; Edited in Spanish by Javier López de Lérida)
