Cuban Studies Institute (Cuba Insight) – U.S. investors hoping to do business in Cuba face numerous problems/issues which include the resolution of U.S. properties confiscated by the Cuban government in the early 1960s; an arbitrary legal system controlled by Gen. Raul Castro and the military; widespread corruption; a value system that includes stealing from enterprises and working as little as possible; and an investment law that requires foreign investors to partner with government officials, mostly military.
In addition, foreign investors will have to deal with the Cuban government violations of the most basic human and labor rights.
- Foreign companies doing business in Cuba must apply to the government for workers. They cannot hire or fire workers on their own without government approval.
- Foreign companies pay the Cuban government in foreign currencies (e.g. euros, Canadian dollars) for their workers. The government pays the workers in Cuban pesos which are worth 1/20 of a U.S. dollar, pocketing 90% of every dollar it receives.
- All Cuban workers in the tourist industry or any industry that comes into contact with foreigners are carefully screened and selected by the government. Lighter skin workers and those loyal to the revolution are picked for hotel, resorts, and other tourist destinations.
- All labor arbitration must take place in the corrupt and arbitrary government offices where little protection is given to the worker or the foreign investor. There is no independent judicial system in the island and all judges are appointed by and work for the government.
- There is only one labor federation in Cuba, the Central de Trabajadores de Cuba (CTC), organized and controlled by the Cuban government.
- All workers must be members of the CTC and pay dues.
- “Elections” at the CTC are held periodically. Only candidates approved by the Cuban Communist Party are allowed to run for local or national leadership positions.
- There is no collective or individual bargaining in Cuba.
- Workers cannot change jobs without government permission.
- Most businesses/agricultural and industrial enterprises are owned by the government—most Cubans work for the State.
- All salaries and benefits are determined by the State.
- Workers are hired, disciplined, and fired by the government.
- The Cuban government hires out physicians, artists, musicians, bartenders, etc. to foreign countries and foreign companies abroad. Cubans usually reside for six months to two years in foreign countries and are paid in hard currency. Yet 40% of their salaries are deducted by their employers and sent to the Castro regime. The amount the Cuban government receives from hired workers abroad ($8-10 billion yearly), is the largest income figure in Cuban budget.
Jaime Suchlicki is Director and founder of the Cuban Studies Institute. He is the author of Cuba: From Columbus to Castro, now in its fifth edition; Mexico: From Montezuma to NAFTA, now in its second edition and the recently published Breve Historia de Cuba. He is a highly regarded consultant to the public and private sectors.
Cuba Insight is a publication of the Cuban Studies Institute.