Business

Politics

Privatisation comes to town— Havana

Preface

Cubans will be chanting in the streets tomorrow as millions turn out for the annual International Workers’ Day parade.

Beauty salons, Pricing, Privatisation

29 April 2010

Cubans will be chanting in the streets tomorrow as millions turn out for the annual International Workers’ Day parade. “We are socialists! March on! March on!” the faithful will cry (or perhaps the more light-hearted, “We might be short of soap, but we’ve got more than enough courage!”). In the country’s barber shops and beauty salons, however, there is talk of another revolution.

The government is making some very tentative steps towards reforming that nation’s radical brand of socialism – starting with the retail sector. This week the Workers’ Union even called for Cubans to parade “in support of economic changes”. And oddly it’s the wielders of hairdryers and mascara brushes who are finding themselves in the frontline of change.

Cuba nationalised all retail businesses in 1968 and the vast majority of the sector remains in state hands today. Recently, however, the government has recognised the need to address the shocking inefficiencies and corruption in its monolithic state-run enterprise. At the end of last year, the finance minister Marino Murillo told Cubans, “We have begun experiments to ease the burden on the state of some services it provides.”

One such experiment is taking place in selected barber shops and beauty salons. These are being allowed to lease their premises from the government and work as cooperatives. They will have to pay water and electricity bills, source their own supplies, but most importantly they will be able to set their own prices. In reality this trial scheme simply legalises what is already happening in many salons but ensures that the government will actually get its cut.

The trials have not been reported in the main sections of the state-run newspaper, Granma. Instead they were presaged by a flurry of unusually frank debate about privatisation on the paper’s letters page.

In the barber shops themselves, privatisation has replaced baseball as the main topic of conversation. While employees are expected to make more money (at least legally) by working in cooperatives, not all are in favour of the proposed reforms.

Santiago, a gold-toothed barber in Havana’s leafy suburbs, who is not part of the trial, says: “They say we can set our own prices. What am I supposed to do with old or disabled people who can’t pay higher prices? Do I chuck them out?

“It’s capitalism. They say we are living in a socialist country, but that is capitalism. And what about the barbers who can’t pay their monthly lease?”

But he agrees that current salaries do not cover even the basic costs of living, admitting that he only manages by cutting hair in hotels three days a week.

Still a state employee, Santiago will be marching along with the rest of Havana tomorrow. But this time next year if he has become a fully-fledged entrepreneur, who knows where he might choose to spend a well-earned day off.

Monocle 24

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