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Friday, 13 January 2012 - Cuba moving some state-run cafes into private hands |
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      Edition: U.S. Africa Arabic Argentina Brazil Canada China France Germany India Italy Japan Latin America Mexico Russia Spain United Kingdom Home Business Business Home Economy Davos 2012 Technology Media Small Business Legal Deals Earnings Summits Business Video Markets Markets Home U.S. Markets European Markets Asian Markets Global Market Data Indices M&A Stocks Bonds Currencies Commodities Futures Funds peHUB World World Home U.S. Brazil China Euro Zone Japan Mexico Russia India Insight World Video Politics Politics Home Election 2012 Issues 2012 Candidates 2012 Tales from the Trail Political Punchlines Supreme Court Politics Video Tech Technology Home MediaFile Science Tech Video Opinion Opinion Home Chrystia Freeland John Lloyd Felix Salmon Jack Shafer David Rohde Bernd Debusmann Nader Mousavizadeh James Saft Lucy P. 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Credit: Reuters/Enrique De La Osa By Marc Frank HOLGUIN, Cuba | Thu Jan 12, 2012 4:16pm EST HOLGUIN, Cuba (Reuters) - For the first time since they were nationalized in the 1960s, Cuba has opened the door to private management of some state-run cafes and food service outlets, often scorned for bad service and poor food. The extension of President Raul Castro's plans to put more retail businesses in private hands is under way as an experiment in eastern Holguin province, where the government will lease to employees more than 200 small cafeterias this year. In the bustling provincial capital, Holguin, private restaurants, cafeterias and snack shops with attractive names and menus provide stiff competition on almost every block to state-run outlets identified only by number and with state-dictated portions. Osvaldo Santos Diaz, head of the state's food services in the province, recently told local media that sales would be down in 2012, "because 211 outlets will move to other forms of management." National media have not mentioned the Holguin program, apparently because it is an experiment that will become generalized sometime in the future. President Raul Castro, who took over for ailing brother Fidel in 2008, has been moving retail services into private hands as part of a myriad of reforms aimed at boosting the country's stagnant, Soviet-style economy. Thousands of state barbershops, beauty parlors and service outlets such as watch and domestic appliance repair, shoe shining and carpentry shops have been handed over to their employees on a leasing basis after similar experiments that were not publicized by the island's state-run media. Julio Cesar Zayas, director of food services in the Barajagua district of Cueto municipality, said the food outlets would be leased to employees to operate as private businesses, pay taxes and compete with thousands of private, mainly home-based cafeterias which have opened around the country over the last year. "There are seven outlets in Cueto that will move to the new system in April," Zayas said. FROM SUBSIDIES TO TAX REVENUE Communist Cuba's state-run food services are notorious for providing poor service, dismal food, diverting supplies and filching customers by skimping on the size of state-assigned portions for everything from a ham sandwich or pizza to a cup of coffee or shot of rum. The Paraiso, a rundown cafeteria that sells rum, soft drinks, cigarettes and snacks in the small mountain town of Barajagua, is on the list. "I think this policy will lead to more earnings for employees and a better offer and service for consumers," said the Paraiso's manager Eusmar Gomez Rodriguez. "Under the new system we will be able to directly purchase and sell what we want and offer more than we do now," he said. A Cuban economist, who asked not to be identified, said such outlets historically operated at a loss for the state. Under the new system, inventory theft should be eliminated because the employees will have an economic stake in the business and, instead of a loss, they should provide the state with tax revenues. At the "Real St. No. 1" cafeteria in the Pueblo Nuevo district, manager Lourdes Mulet said final word on which state-run outlets would move to the new system had not yet come down, but she hoped hers would be among them. "I think if you work hard your earnings will improve, though I'm not certain because this is new," said Mulet. She currently makes 250 pesos per month, the equivalent of $10.00. (Editing by Jeff Franks and Jackie Frank) World Cuba Tweet this Link this Share this Digg this Email Reprints   We welcome comments that advance the story through relevant opinion, anecdotes, links and data. If you see a comment that you believe is irrelevant or inappropriate, you can flag it to our editors by using the report abuse links. Views expressed in the comments do not represent those of Reuters. For more information on our comment policy, see http://blogs.reuters.com/fulldisclosure/2010/09/27/toward-a-more-thoughtful-conversation-on-stories/ Comments (0) Be the first to comment on reuters.com. Add yours using the box above.   Edition: U.S. Africa Arabic Argentina Brazil Canada China France Germany India Italy Japan Latin America Mexico Russia Spain United Kingdom Back to top Reuters.com Business Markets World Politics Technology Opinion Money Pictures Videos Site Index Legal Bankruptcy Law California Legal New York Legal Securities Law Support & Contact Support Corrections Advertise With Us Connect with Reuters Twitter   Facebook   LinkedIn   RSS   Podcast   Newsletters   Mobile About Privacy Policy Terms of Use Our Flagship financial information platform incorporating Reuters Insider An ultra-low latency infrastructure for electronic trading and data distribution A connected approach to governance, risk and compliance Our next generation legal research platform Our global tax workstation Thomsonreuters.com About Thomson Reuters Investor Relations Careers Contact Us   Thomson Reuters is the world's largest international multimedia news agency, providing investing news, world news, business news, technology news, headline news, small business news, news alerts, personal finance, stock market, and mutual funds information available on Reuters.com, video, mobile, and interactive television platforms. Thomson Reuters journalists are subject to an Editorial Handbook which requires fair presentation and disclosure of relevant interests. NYSE and AMEX quotes delayed by at least 20 minutes. Nasdaq delayed by at least 15 minutes. For a complete list of exchanges and delays, please click here.

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