A Call for US Dollars to Return

“These people have a way back and a way forward that no one understands,” was the response of a user on social networks to the announcement that dollar cash deposits were once again possible in Cuba.

The Central Bank of Cuba (BCC) announced on April 10, 2023 the repeal of a resolution of from June 2021. This prohibited banks and non-bank financial institutions from accepting USD in cash.

The inconsistency of the Cuban government in its policy on the use of the dollar on the island, without the causes being clear (although there is speculation about them), was the subject of memes and debates on the internet.

In 2021, the State justified the ban with the obstacles imposed by US sanctions for the national banking system to deposit cash in US dollars abroad. Two years later, and without anything having changed in this regard, they resume operations alleging other reasons: overcoming the COVID-19 pandemic, the start of the revival of tourism and the presence of foreign visitors in the country.

They resumed the race to dollarize part of the economy. A race that no one knows where it will end, that sometimes they abandon and other times they do it backwards, always with a negative impact on ordinary Cubans.

The dollarization process, has included in recent years the 2019 opening of the first stores in MLC (magnetic dollars), the elimination of the 10% tax on operations in cash dollars (2020), the temporary suspension of dollar bank deposits in cash (2021), the start of the sale of dollars to individuals at 120 pesos for one dollar, and now the accepting of cash deposits in banking entities.

While the Government plays Monopoly, citizens wonder how this will affect their daily lives. Will the informal market value of other foreign currencies increase? Will inflation and scarcity decrease?

Tug-of-war at the Cuban Central Bank

CENTRAL BANK OF CUBA – Now what we need is for the people to deposit their dollars and continue trusting us…

My bank is your bank… Remittances welcome

So, explain to me what it’s about? Now we will be hungry in dollars. Right?

This article was translated into English from the original in Spanish.