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Networks for Prosperity PART 2, Chapter 3: Knowledge without Frontiers
Case: Promoting exports in Cuba’s changing economy
"These realities compel us to speed up the improvement of the agencies managing our work and the performance of companies and other institutions, and intensify the re-classification of leaders at every level in order to realize the content of the Guidelines approved by the Party’s Congress, particularly in reference to promoting the role of accounting and internal control as irreplaceable tools of business management…, crucial factors in the interrelationships of the different actors of the economic life of our nation.” Raul Castro Presidente de los Consejos de Estado y de Ministros, August 2011.
Cuba’s 11.2 million people have a high level of human development. Cuba achieved 0.706 on the United Nation’s Development Programme’s (UNDP) Human Development Index in 2010, well ahead of the regional average in Latin America and the Caribbeanxxiii. The country performs well on most health, education and income equality measures, although there is lack of agreement about its methodology for calculating GDP per capita. It reports that it is on track to achieve many of the Millennium Development Goals by 2015 (Government of Cuba, 2010). There are few studies on Cuba’s overall economic competitiveness. However, there have been numerous studies on traditional sectors such as agricultural commodities (especially the decline in sugar production after 1992), and minerals (notably nickel). There has also been a focus on successful non-traditional sectors like tourism, biotechnologyxxiv and musicxxv. This changing economic structure means that the country’s carbon emissions per unit of GDP have fallen substantially in the past decade (IEA, 2011). Despite the lack of global benchmarking studies, competitiveness is on the domestic policy agenda. For example, UNIDO has supported the multi-project Integrated Programme to Support the National Strategy on Industrial Competitiveness. In total some 25 projects have been undertaken. UNIDO also supported the strengthening of the Network of Industrial Information (DP/CUB/01/019)xxvi.
THE NEW ECONOMIC AND SOCIAL POLICY
Cuba has recently undertaken a major economic modernization initiative, the “Proyecto de Lineamientos de la Política Económica y Social” or “Guidelines for Economic and Social Policy” and the law of October 2010 on Employment and Microenterprise, which stresses efficiency and productivity. A notable feature of the guidelines was the change of approach towards small businesses. There would be a modest increase in the range of permitted activities; some relaxation of regulations and changes in tax; and a significant liberalization of licensing. Overall, it would amount to a reversal of the traditional stigma attached to non-state economic activities, and with positive encouragement for the formation of cooperatives in sectors like taxis and beauty care. These economic and social policy measures were subsequently approved at the 6th Party Congress in June 2011, and Adel Izquierdo became Minister of the Economy and Planning. The question now is what types of institutional support might be needed to help the new economic and social policy deliver the scale of employment required over the next few years (500,000-1.2 million jobs). As part of that debate, it is worth reviewing the roles of three key institutions that could be expected to play an active role in knowledge sharing in support of the expected growth in small enterprises.