PRESIDENT Miguel Diaz-Canel says Cuba will on January 1 start currency unification.
According to a statement, Cuba will start dismantling its current two-teer monetary system as of January 1, 2021 leaving the traditional peso (CUP) as the only official currency of the land at an initial exchange rate of 24 to one US dollar.
President Diaz-Canel made the announcement at a special message to the nation in a radio-television hookup.
This is the first measure formally announced as part of broader plan to overhaul the economy.
After his presentation, economy minister Alejandro Gil tweeted that the monetary unification “is an essential measure to boost the economy and the country’s development. We are moving into a period of deep and necessary changes for the good of all.”
In a radio and television hookup, President Diaz-Canel accompanied by Army General and First Secretary of the Cuban Communist Party, Raul Castro, said the plan to unify the Cuban currency would kick off on January 1.
For a little more than 20 years Cubans have had two currencies, the CUP and the convertible peso (CUC) that was introduced in the late 90’s for all national transactions, but this two-teer monetary system became a burden for the necessary boosting of the economy.
To cushion the impact on the people of the monetary unification, State officials have been telling the nation lately that the process to do away with the CUC would take six months.
The President assured that people’s resources in CUC either in hand or in saving bank accounts would be respected at the current exchange rate, which is 24 CUPs to one CUC.
Faced with a tough economic and financial crisis due to the effects of the COVID-19 pandemic, worsened by a hardened US blockade, the Cuban government opened retail shops in hard currency with the use of personal banking cards in an effort to collect foreign monetary assets.
Authorities say the monetary unification was part of a broader programme, known as economic reordering, that envisions, too, a wage rise, in conjunction with a price hike equivalent to the salary raise, tariff increase, change in subsidy plans, among other economic measures designed to respond to Cuba’s reality, prop up the economy and boost development.
President Diaz-Canel stressed that the Cuban State would not neglect any of the country’s citizens, asserting welfare programmes and social plans would be in place to help those with less monetary income.
He further said tough sanctions would be imposed on those who manipulate and speculate with prices and illicit money changing.
Before winding down his message, President Diaz-Canel announced that further information would be provided to the nation from ministers in coming days.