No more free lunch in Raul Castro's Cuba

By Isabel Sanchez:


HAVANA, Cuba (AFP) -- President Raul Castro is taking a bold gamble to ease communist Cuba's cash crunch by eliminating a costly government lunch program that feeds almost a third of the nation's population every workday.

The Americas' only one-party communist government, held afloat largely by support from its key ally Venezuela, is desperate to improve its budget outlook; the global economy is slack, and Havana is very hard pressed to secure international financing.

Raul Castro, 76, officially took over as Cuba's president in February 2008 after his brother, revolutionary icon Fidel Castro, stepped aside with health problems.

Though some wondered if Raul Castro would try to move Cuba's centralized economy toward more market elements, so far he has sought to boost efficiency and cut corruption and waste without reshaping the economic system.

And so far it has been an uphill battle, something akin to treading water.

But now, Raul Castro has moved to set in motion what will likely be the biggest rollback of an entitlement since Cuba's 1959 revolution -- starting to put an end to the daily lunch program for state workers, as announced Friday in Granma, the Cuban Communist Party newspaper.

In a country where workers earn the average of 17 dollars a month, and state subsidized monthly food baskets are not enough for families, more than 3.5 million Cuban government employees -- out of a total population of 11.2 million -- benefit from the nutritionally significant free meal.

The pricetag is a cool 350 million dollars a year, not counting energy costs or facilities maintenance, Granma said.

But that will come to a halt in four ministries experimentally from October 1, Granma said. As workers stream to the 24,700 state lunchrooms, the government "is faced with extremely high state spending due to extremely high international market prices, infinite subsidies and freebies," Granma explained.

Parallel to the cutback, workers will see their salaries boosted by 15 pesos a workday (.60 dollar US) to cover their lunch.

It is a dramatic shift in Cuba, where the government workers' lunchroom has been among the longest-standing subsidies, though even authorities have called it paternalistic.

And more troubling, especially for authorities, is the fact that the lunchrooms' kitchens have become a source of economic hemorrhaging, from which workers unabashedly make off with tonnes of rice, beans, chicken and cooking oil to make ends meet.

The Castro government is keen to reduce the 2.5 billion dollars a year it spends on food imports, which it has to buy on the international market in hard currency.

"Nobody can go on indefinitely spending more than they earn. Two and two are four, never five. In our imperfect socialism, too often two plus two turn out to be three," Raul Castro said in an August 1 address alluding to corruption problems.

Some Cubans were aghast at the idea of losing a free lunch.

"What am I going to buy with 15 pesos," asked a bank worker, who spoke on condition of anonymity. "I cannot even make anything, even something horrible, at home for that little."

But Roberto Reyes, a construction employee, said sometimes the state lunch is so bad, he would rather not eat it -- and pocket the small monthly raise.

The president has said health care and education were not cuts he would willingly make.

But Cubans wonder how long it will be until the legendary monthly ration books with which Cubans receive limited basic food goods, such as rice and beans, for free, come under the budget axe.

September 28, 2009

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Bahamas Caribbean Blog International

Bahamas Financial Services Board: Exit sparks offshore exodus fears

By INDERIA SAUNDERS ~ Guardian Business Reporter ~ inderia@nasguard.com:

The head of the Bahamas Financial Services Board (BFSB) is moving to allay concerns that The Bahamas will see a mass exodus of offshore banks on the heels of the pending exit of BNP Paribas.

It's a response sparked by that bank's decision to withdraw before the end of 2010 from countries gray listed by the OECD and viewed as "tax havens".

"It's a time of change and there will always be some amount of unsettlement in an industry of our size," Executive Director Wendy Warren told Guardian Business. "It's important to emphasize that government will maintain continuous dialogue with the industry... in the coming months The Bahamas will meet standards in a judicious matter."

Warren said she was unaware of any more banks that were preparing to follow in BNP's footsteps, asserting that it was mostly understood throughout the sector that The Bahamas is just months away from moving off the Organization for Economic Cooperation and Development (OECD) gray list.

A minimum number of 12 tax information exchange agreements (TIEAs) are required by a jurisdiction to satisfy the standard set by the OECD, which has now put pressure on "tax havens" for greater disclosures.

The Bahamas' current placing on the gray list is a primary reason why BNP CEO Pascal Dulau said the company has made the decision to exit the country.

"Despite its excellent financial performance in the current economic crisis, BNP Paribas has conducted a global review of its network in the context of the ongoing changes in the world financial system and G20 initiatives," said Dulau.

"In the light of this review, BNP Paribas has taken the decision to withdraw before the end of 2010 from countries grey listed by the OECD and viewed as tax havens.

"This includes The Bahamas."

According to Dulau, the bank was currently deciding the better of two options — either selling part of the business or transferring it to another jurisdiction. He did say, however, that the company had no fixed schedule for departure, saying it would depend largely on if they are able to "fix everything" before the end of 2010.

"In its exit strategy, BNP Paribas (Bahamas) Limited will preserve in the best manner the interest of its clients and 40 local staff members," he said. "As always, it is BNP Paribas' objective to act in this critical period as a responsible local and international player."

Dulau said there was no possibility to reverse the decision, even after The Bahamas moved off the gray list. Some local analysts indicate, however, that there is more to BNP's exit than the OECD's pressure.

September 28, 2009

thenassauguardian

Bahamas Caribbean Blog International

Climate and economic crises taking heavy toll on Caribbean, leaders tell UN

While climate change and the global economic crisis are a challenge for all, they are particularly difficult for the small, island nations of the Caribbean, several leaders from the region told the United Nations General Assembly today.

“It is a fact that when global crises occur small vulnerable economies tend to pay a disproportionately high price,” Prime Minister Denzil L. Douglas of Saint Kitts and Nevis said, as he addressed the Assembly’s annual high-level debate.

He pointed out that, in the case of the economic crisis, the circumstances which precipitated the virtual collapse of several financial institutions were not created by small States such as Saint Kitts and Nevis – the smallest nation in the Western Hemisphere.

“Yet, as in the case of climate change, their consequences are forced upon us and we are left to fend for ourselves.”

Despite the recent downturn, small economies like his continue to display resilience and make the necessary sacrifices to sustain themselves, he said.

Saint Kitts and Nevis is investing in its people through education and retraining, and working to attract international investments in critical sectors to generate employment and other business opportunities. “By doing this, we hope to prepare for the future when the global economy eventually rebounds,” said the Prime Minister.

Secretary-General Ban Ki-moon today reaffirmed the UN’s commitment to working with the region, which has been “especially hard-hit” by both the global financial crisis and climate change.

“I am well aware of the heavy toll the global economic crisis is taking on your countries,” he told leaders gathered for a mini-summit on the Caribbean Community (CARICOM). “Oil prices are high, remittances are down, tourism is severely depressed and foreign direct investment has slowed.

“There is talk of recovery – but the impact of the crisis could reverberate for years. Your economies are more fragile than many others,” he said.

The Prime Minister of Trinidad and Tobago, Patrick Manning, also highlighted the vulnerabilities of small economies in his address to the Assembly’s debate.

“We of the smaller countries and the developing world have always been the most vulnerable and the worst affected,” he said. “It is happening again… especially in the Southern Hemisphere, the prospects have grown for increase in poverty, unemployment and general slippage in the development process.”

Like many others in the debate, Mr. Manning said that the crisis has made clear the urgent need to reform the global economic system.

“We clearly cannot take our eye off the ball. We must not return to business as usual… We must be very wary of the level of adventurousness in leading financial institutions, which contributed very significantly to driving the world to the edge of an economic precipice, from which we are just starting to pull back.

“We must now capitalize on the opportunity of this crisis and, without delay, reform our international economic system,” he stated, adding that the global architecture must be transformed to take into account the new realities.

Kenneth Baugh, Deputy Prime Minister and Minister for Foreign Affairs and Trade of Jamaica, noted that the consequences of the economic crisis – plunging inflows of financing and investment, weak exports, low commodity prices and diminished aid – are reflected in his country and throughout the CARICOM region.

“Countries like ours now face the daunting challenge of protecting the most vulnerable of their citizens in a responsible and sustainable manner in the context of declining export demand, contraction in services, including tourism, and lower remittances,” he stated.

He added that for the majority of developing countries, the impact of the crisis “will be deep, it will be prolonged and it will be painful.”

26 September 2009

UN News

Bahamas Caribbean Blog International

News Tracker: past stories on this issue:

Assembly President urges Latin America, Caribbean to support economic summit

A revolution is being born there

Reflections of Fidel

ON July 16, I stated textually that the coup d’état in Honduras "was conceived of and organized by unscrupulous individuals on the extreme right, dependable officials of George W. Bush and promoted by him."

I quoted the names of Hugo Llorens, Robert Blau, Stephen McFarland and Robert Callahan, yanki ambassadors in Honduras, El Salvador, Guatemala and Nicaragua, appointed by Bush in the months of July and August of 2008, the four of them following the line of John Negroponte and Otto Reich, both of a shady history.

I indicated the yanki base of Soto Cano [Palmerola] as a central support point for the coup d’état and that "the idea of the a peace initiative from Costa Rica was transmitted to the president of that country from the State Department when Obama was in Moscow and stated, in a Russian university, that the only president of Honduras was Manuel Zelaya." I added that "the Costa Rica meeting called into question the authority of the UN, the OAS and other institutions which had committed their support to the people of Honduras and that the only correct thing to do was to demand that the United States should end its intervention in Honduras and withdraw the Joint Task Force from that country."

The response of the United States in the wake of the coup d’état in that Central American country has been to draw up an agreement with the government of Colombia for the creation of seven military bases, like the one in Soto Cano in that sister country, which are a threat to Venezuela, Brazil and all the other nations of South America.

At a critical moment, when the tragedy of climate change and the international economic crisis is being discussed in a summit meeting of heads of state of the United Nations, the coup perpetrators in Honduras are threatening to violate the immunity of the Brazilian embassy, where President Manuel Zelaya, his family and a group of his followers who were forced to take shelter in that building are to be found.

It has been confirmed that the government of Brazil had nothing whatsoever to do with the situation that has been created there.

It is therefore inadmissible, moreover inconceivable, that the Brazilian embassy should be assaulted by the fascist government, unless that government is attempting to be the instrument of its own suicide by dragging the country into a direct invasion by foreign forces, as was the case in Haiti, which would signify a direct invasion of yanki troops under the flag of the United Nations. Honduras is not a distant and isolated country in the Caribbean. An intervention by foreign forces in Honduras would unleash a conflict in Central America and create political chaos in all of Latin America.

The heroic struggle of the Honduran people after almost 90 days of incessant battling has placed in crisis the fascist and pro-yanki government that is repressing unarmed men and women.

We have seen a new awareness emerge in the Honduran people. An entire legion of social fighters has been hardened in that battle. Zelaya fulfilled his promise to return. He has the right to be reestablished in government and to preside over the elections. New and admirable cadres are standing out among the combative social movements, capable of leading that nation along the difficult roads that await the peoples of Our America. A revolution is being born there.

The UN Assembly could be a historic one, depending on its correct decisions or errors.

World leaders have expounded issues of great interest and complexity. They reflect the magnitude of the tasks that humanity has ahead of it and how scant the time available is.

Fidel Castro Ruz

September 24, 2009

1.23 p.m.

Translated by Granma International

granma.cu

Only socialism will save the planet, affirms Chávez at the UN

UNITED NATIONS, September 24.—President Hugo Chávez of Venezuela affirmed here today that socialism is the only true way forward for the salvation of the planet. "Only with socialism will we achieve real changes, a new Indo-American, Martí, Bolivarian socialism," stated the Venezuelan leader, speaking at the 64th session of the UN General Assembly.
Prensa Latina notes that, in the context of that idea, the dignitary called on the world to accept that there is a revolution in Latin America of a geopolitical nature and with very profound roots.

"South of the border," he said in reference to the film of the same name by Oliver Stone, "there is a revolution and the world has to see that and take it on, a necessary revolution that is large and will continue growing, nobody can detain it."

Chávez urged his U.S. counterpart, Barack Obama, to take concrete action coherent with his political discourse, which is why he wondered if there were two Obamas.

"I prefer to believe in the Obama who stood here yesterday and said that he would fight for world peace. What he said was that no government should impose on any other nation. So, Obama, why don’t you act accordingly and abandon the savage blockade of Cuba?" he asked.

Referring to climate change, Chávez said that the cause of contamination is hyper-consumerism, noting that reserves of gas and oil are being exhausted and that some people seemed to think that this is a metaphysical preoccupation. He went on to quote various excerpts of Fidel Castro’s Reflection "An endangered species."

He stated that the U.S. president, who advocated the non-proliferation of nuclear weapons, should begin that process in his own powerful nation: "destroy your arms," he affirmed.

Applauded at various points of his speech to the Assembly, Chávez also condemned the coup d’état in Honduras.

He made particular reference to the repression unleashed on the Honduran people by the coup government and the harassment of the Brazilian embassy in Tegucigalpa, where the constitutional president, Manuel Zelaya has been staying for three days. He called on Honduran soldiers, the sons of Morazán, to stop repressing the people, a people with 90 days on the streets resisting, he stressed.

Chávez criticized the United States for still failing to recognize the existence of a military coup in Honduras and for the contradictory actions of the White House in response to that grave political situation.

He explained that it has become evident that there is a battle between the State Department and the Pentagon, which latter institution wants to dominate the world and is behind the coup. "We ask for the UN resolutions on the reestablishment of constitutional order in Honduras to be fulfilled," Chávez underlined.

He likewise called on Washington to withdraw the 4th Fleet from Latin America and the Caribbean, as well as to abandon the seven military bases in Colombia, given that they constitute a serious and real threat to regional peace.

According to ABN, referring to the U.S. president’s speech, Chávez commented that it didn’t smell of sulfur, recalling the expression he used three years ago in that same scenario in relation to George W. Bush. "It smells more of hope and we have to give heart to hope." He added that he is of the opinion that, just like Kennedy, the current president is intelligent. "God spare Obama from the bullets that killed Kennedy."

MORE VOICES AGAINST THE BLOCKADE

South African President Jacob Zuma urged a fundamental reform of the international financial institutions and the United Nations, and added, "We also urge the lifting of the economic, commercial and financial blockade of Cuba."

For his part, the president of Sao Tome and Principe, Fradique Bandeira Melo de Menezes, noted that his country is disappointed at the little progress made in relation to the blockade of Cuba. "We hope that the new president of the United States will bring this matter to an end," he stated.

Translated by Granma International

granma.cu

Bahamas Blog Bahamas

Caribbean tax havens talk back against G20 'finger pointing'

By Alan Markoff:

GEORGE TOWN, Cayman Islands (Reuters) -- Caribbean and Atlantic offshore finance centers are hitting back against attempts to portray them as shady tax havens and say world leaders are making them scapegoats for the global downturn.

Leaders of the Group of 20 economic powers, meeting in Pittsburgh on Friday on global economic issues, launched a campaign in April to name and shame tax havens and penalize those who failed to tighten tax standards and transparency.

Spurred by public outrage over big bonus-earning bankers and high-profile frauds by wealthy financiers, G20 governments have pointed accusing fingers at tax havens across the globe, many of them on tiny, beach-rimmed islands in the Caribbean.

As US investigators probe Swiss bank accounts held by suspected US tax cheats, leading offshore jurisdictions say they resent being cast as hide-outs for tax evaders and crooks.


"It's not fair," said McKeeva Bush, political leader and Minister of Financial Services of the Cayman Islands, the tiny British overseas territory south of Cuba that is one of the world's largest domiciles of hedge funds.

He and other policymakers and business chiefs from prominent Caribbean and Atlantic offshore centers say the anti-tax haven "finger pointing" by the world's richest and most powerful governments is hypocritical and seeks to shift blame away from their own failed policies and lax regulation.

"It's the fault of the onshore centers who taxed their own people ... money is running away from them now," Bush said.

"Cayman had nothing to do with the investing in sub-prime derivatives, US housing bubble or gross over-leveraging of the main banks ... It's a nice diversion to blame the evil guys in the Caribbean instead of laying blame where it belongs," said Grand Cayman real estate developer Michael Ryan.

"There is a lot of finger pointing at the offshore world," said Cheryl Packwood, chief executive officer of the Bermuda International Business Association. Bermuda, a tiny Atlantic island that is also a British territory, is a center for the global insurance industry.

But in the United States alone, offshore tax havens are estimated to deprive the Treasury of $100 billion a year. Official efforts to track down tax dodgers have gained pace as the US government seeks to collect more revenues without raising tax rates to offset its vast and growing budget deficit.

After G20 leaders this year declared a crackdown against tax havens, the Organization for Economic Cooperation and Development (OECD) in April published a "gray list" of jurisdictions they said fell short of full compliance with internationally agreed tax standards. More than a dozen Caribbean jurisdictions, and Bermuda, were on the list.

But while Caribbean and Atlantic offshore financial centers reject what they see as a one-sided witch hunt against them, their governments have nevertheless scrambled to get themselves dropped from the damning OECD noncompliance list."

The Caymans and the British Virgin islands achieved this in July after signing at least 12 bilateral tax agreements in line with OECD standards. Bermuda has also moved up to the "white list", and other Caribbean states are signing tax treaties.

Anthony Travers, chairman of the Cayman Islands Financial Services Association, sees an attempt by the G20 nations to impose what he calls a "new world order predicated on a global one-size-fits-all higher rate of taxation".

Bermuda's finance minister, Paula Cox, also suspects the world's richest states may be seeking "extra-territorial solutions to their economic, fiscal and financial challenges."

"There is now a strong suspicion that the G20 has an undisclosed agenda item to drive forward a global corporate tax policy, which may fly in the face of a nation's sovereign right to set down its own tax policy," she said.

Timothy Ridley, former chairman of the Cayman Islands Monetary Authority, believes the crackdown on tax havens stems largely from fear of competition by "those ... who wish to retain control of the world's capital and to tax it".

Some experts in the Bahamas suggested the offshore sector should ensure its future by shifting away from clients in the United States, Europe and Canada to new wealthy customers in emerging powers like Brazil, China, Nigeria, Russia and India.

"If you can provide new services to these markets, you will swim, not sink," said Julian Malins, a London-based barrister who has acted as counsel for cases originating in the Bahamas.

While insisting they have put their finance sectors in order from the regulatory viewpoint, political and business leaders of these offshore jurisdictions admit their territories have not escaped the battering of the global financial crisis.

"Fewer tourists, lower tourist and consumer spending, the squeeze on business profits, redundancies and lay-offs are all the result of the global recession," said Bermuda's Cox.

This has led to some companies leaving the Atlantic island insurance center. This week, directors of global insurance broker Willis Group Holdings approved moving its domicile from Bermuda to Ireland, citing economic factors.

But both Bermudian and Caymans business leaders felt their finance centers could weather the economic storm and prosper.

"Money is going to find the right place to be," said Cayman's Leader of Government Business Bush, who is embroiled in a dispute with Britain over the islands' financial management.

"No matter what (the United States and EU) try to do, the more regulated places will survive and the Cayman Islands will survive," he said.


September 26, 2009

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Bahamas Caribbean Blog International

 

Qaddafi and (his son) Obama headline UN's annual gabfest

By Anthony L Hall:

Watching world leaders deliver speeches at the annual United Nations General Assembly is rather like watching actors perform in an Italian opera. And, frankly, their speeches usually have about as much practical import as the arias in an opera.

(Of even less significance of course are those delivered by Caribbean leaders who, continuing the analogy, comprise the chorus in this political farce.)


Nevertheless, some of the notes sounded on Wednesday by two first timers, namely US President Barack Obama and Libyan President Muammar el-Qaddafi, are worthy of comment.

Obama used his address, the first of his nine-month presidency, to remind the member nations of this notoriously feckless body of their collective responsibility to help fight the global threats and challenges we face, including terrorism and climate change.

And in one deftly crafted sentence he managed both to reinforce his mandate to transform America’s image in the world and to indicate that his predecessor’s unilateral approach might not have been entirely unwarranted:

“Those who used to chastise America for acting alone in the world cannot now stand by and wait for America to solve the world’s problems alone.”

Regrettably, this was not only his highest note, it was the only one he sounded that we haven’t heard a thousand times before...

By contrast, Qaddafi used his address, the first of his 40-year dictatorship, to unleash an entertaining, stream-of-consciousness rant that showed why only Fidel Castro rivals his flair for Third World, revolutionary rhetoric.

For over 90 minutes (instead of the 15 he was allotted), he railed against a litany of injustices (real and imagined) that have been perpetrated (primarily by the US) since the UN was founded 64 years ago. He cited, among other cases, the wars in Vietnam, Grenada, Panama, Iraq and Afghanistan; the assassinations of JFK and MLK; and the conspiracy of pharmaceutical companies manufacturing diseases like Swine Flu so that they can peddle vaccines for profit.

But he unleashed the lion’s share of his long-simmering rage on the untenable double standard that governs almost all UN resolutions. In particular, he accused the five permanent members of the UN Security Council (namely, the United States, Britain, France, Russia and China) of using their veto powers to wage war and impose sanctions against other members like al Qaeda terrorists:

“The preamble (of the charter) says all nations are equal whether they are small or big… Veto power should be annulled... The Security Council did not provide us with security but with terror and sanctions. It should not be called the Security Council; it should be called the terror council.”

Granted, the allusion to terrorists is a bit extreme; but this indictment of the UN contains much more than a grain of truth. And, incidentally, I also think there’s merit in Qaddafi’s grievance about how unfair, inconvenient and unnecessary it is to have the UN (still) headquartered in the US (Indeed, why not France, China or India?).

Conspicuously absent from his indignant diatribe, however, was any reference to the many injustices he’s alleged to have perpetrated. Indeed, this is why, even though much of Qaddafi’s message was undeniably true, I understand why so many people just want to shoot this messenger.

All the same, nothing distinguished his performance quite like the unrequited praise he heaped on Obama, even referring to him (with Pan-African pride) as “my son”:

“I’m happy that the new president, a son of Africa, governs the United States of America. This is a historic event. This is a great thing. Obama is a glimpse in the darkness after four or eight years. We are content and happy if Obama can stay forever as president of the United States.”

That said, I usually mark this annual gabfest by commenting on the world leader whose attendance many herald like the arrival of a skunk at a dinner party. In recent years Venezuelan President Hugo Chavez and Iranian President Mahmoud Ahmadinejad have received this dubious honor. Not surprisingly, it’s Qaddafi this year.

No doubt you’ve heard that relatives of the victims of Pan Am flight 103 orchestrated a persona-non-grata campaign to ensure that he would have no place on US soil to pitch his Bedouin-style tent, which he uses to entertain guests wherever he goes.

Of course, this extraordinary display of inhospitality stems from the fact that many people believe Qaddafi ordered the terrorist bombing of this flight in 1988, which killed 189 Americans. And it was only exacerbated by the fact that, after Scottish authorities released the only man convicted of this bombing a few weeks ago, Qaddafi welcomed him home as a national hero.

However, notwithstanding my sympathy for these still grieving souls, it reeks of vintage American arrogance and stupidity that so many opportunistic, small-town politicians have enabled their misguided campaign against this Libyan head of state.

(They have somehow managed to deny Qaddafi permission to pitch his tent in New York’s Central Park, on the grounds of the Bedford, NY estate he actually leased from Donald Trump, or even on the grounds of the New Jersey residence of his own UN representative.)

Meanwhile, this jingoistic nimbyism makes a mockery of the benevolent, cooperative and, yes, hospitable image of America Obama projected during his UN address. Never mind that it plays right into Qaddafi’s assertion that the time has come to move the headquarters of the UN out of the US.

NOTE: Most world leaders sit in the General Assembly when US presidents deliver their annual address. Therefore, I remain nonplused by the slight all US presidents, including Obama now, show them by refusing to reciprocate this respect.

But that Obama aped Bush by not even having the US Ambassador to the UN (or any US representative) show Ahmadinejad this respect is inexcusable and says more about America’s congenital imperiousness than it does about Iran’s nurtured defiance.

Related commentaries:
World leaders blow hot air at UN confab
Release of Lockerbie bomber…


September 25, 2009


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