New Regulations and Fees Threaten the Supply Chain of Cuba's Newly Minted Entrepreneurs

Yoani Sanchez - Award-winning Cuban blogger

New Regulations and Fees Threaten the Supply Chain of Cuba's Newly
Minted Entrepreneurs
Posted: 07/05/2012 5:10 pm

The pepper is of carved wood and a seasoning container on the table says
"Sedano's" in green letters. The private restaurant waits for the
supplies that will arrive this Saturday in an enormous delivery
transported by a "mula" -- a mule. If the delivery is even a day late,
many of the items offered on the menu might not be available because a
good part of "the pots, the condiments, the supplies for the tables, the
cream, and even the coffee" comes from Florida, according to what the
owner of the place tells me. Since they opened the doors they have been
sustained thanks to a flood of food and supplies coming in through the
Havana airport. "It's not that we don't like domestic products, it's
that there isn't a steady supply of them of the necessary quality. So we
have to go with what is safe," the Chef tells me, while opening a
package of imported pasta.

The alarm extends among the small private businesses created in recent
years. Of the 387,275 self-employed workers as of the end of May, it's
difficult to estimate how many of them depend on what travelers carry in
their luggage. But the number must be very high. The manicurist needs
the nail polish and the polish remover sent by a relative in Miami and
the man who organizes children's parties receives balloons and candy
from his brother living in Orlando. Now, this semi-alternative
commercial network is in danger from new customs regulations. The first
of them went into effect on June 18, and reinstated the taxes on food
imports. A common measure in many countries around the world, but one
that puts a brake on small business development in a nation marked by
shortages, the absence of wholesale markets, and the high price of food
products. If we have seen a flourishing of snack bars on the central
streets of the capital, and yellow pages filled with ads, it has been,
to a great degree, thanks to the package services from the north.

The situation will become more difficult once the new regulations
announced Monday go into effect; starting on September 3 a tariff will
be levied on personal items whose value exceeds 50 Cuban pesos, about
two dollars. A tough blow to the self-employed and also for all Cubans
who have managed to improve their diets and wardrobes with these foreign
products. If the measures are focused on raising as much cash as
possible through customs and legally regulating what was working outside
its control, the government will probably achieve its objective. But it
will also have an immediate and extremely negative impact on the
development of the private sector. It won't be unexpected if, within
days, we hear from the mouths of the self-employed phrases such as "we
can no longer do this work because the package of raw materials hasn't
come yet," or "we used to prepare this dish when the mulas came more
often." And only then will we perceive the real importance of this
commerce -- incalculable and vital -- that travels inside suitcases.

Note to my readers: If the concept of "mule" is taken in the rest of the
world as someone who transports drugs, in Cuba it refers to those who --
particularly from the United States -- carry packages that almost always
contain such things as clothing, shoes, non-perishable food, small
appliances, food mixes, medicines and household items. The mula is paid
for this messenger service and often the cost of the ticket to the
island is paid for as a part of the agreement with the agency that hires
them.

http://www.huffingtonpost.com/yoani-sanchez/new-regulations-and-fees-_b_1652286.html