Moving to Cuba

by moveforward on August 27, 2010

One of the main reasons why Cuba is often ignored by ex-pats is because many people have very tunnelled vision and often focus upon certain elements of a country while perhaps missing the point regarding the overall situation. Cuba is a country which is often associated with Fidel Castro, cigars and crime although the country has significantly more to offer than many people appreciate!

Cuba

The Republic of Cuba, to give Cuba its official name, is a country which has a very difficult and a very volatile history but it is one which has far more to offer than many people appreciate. True, there have been many wars in association with Cuba and the surrounding area but the Cuba which we see today is very different to the Cuba of 10 years ago, 20 years ago or 50 years ago. The country has a very close relationship with a number of trading partners in the area and has continued to build upon its growing reputation.

Cuba itself has very close links with the Spanish authorities and indeed the 1868 “10 years war” resulted in Cuba gaining independence from Spain and beginning to stand on its own two feet. For many years the US authorities refused to acknowledge the existence of Cuba as an independent country although this has changed over the years.

Where is Cuba?

Cuba is an island which is located in the Caribbean consisting of the main island of Cuba and a number of smaller surrounding islands. The country is perfectly situated for trading partners as it is located where the Gulf of Mexico and the Atlantic Ocean join together and is also within travelling distance to the United States of America, the Bahamas, Haiti Jamaica, the Cayman Islands and Mexico. The main island of Cuba is the 16th largest island in the world and offers a vast array of different climates, geography and experiences.

For those who have yet to check out Cuba you may well be missing out on a very different and potentially a very enjoyable experience.

The weather in Cuba

The location of Cuba offers a varied and often volatile climate although in general it is classed as a tropical area of the world. However, the winds from the northeast tend to impact upon local weather patterns although in general the dry season occurs between November and April with the rainy season between May and October. The weather in Cuba can vary on average between 21°C in January to around 27°C in July highlighting the fairly small movement in temperatures.

However, the very fact that Cuba is located in touching distance of the Caribbean Sea, the Atlantic Ocean and the Gulf of Mexico unfortunately puts the country smack bang in the middle of one of the more volatile hurricane corridors in the region. The hurricane season tends to run from September to October and while Cuba often escapes the worst of the hurricanes in the region they can still cause havoc and devastation.

Working in Cuba

Those who have ever followed the Cuban economy will be well aware that this is a country which is steeped in socialist principles and has historically had a very close relationship with the Soviet Union. The vast majority of production in Cuba is owned by the government and the vast majority of the labour force is actually employed by the authorities. However, the collapse of the Soviet Union led to Cuba being left to go alone and the country was forced to take in limited free-market principles to ensure that food was in ready supply and consumers were able to gain access to goods and services required.

While the public sector currently accounts for 78% of the workforce, with 22% in the private sector, this does actually compare favourably to 1981 when 92% of employees were employed by the state and just 8% by the public sector. However, the vast majority of prices and rations of goods in Cuba are still controlled by the government which continues to keep a very tight grip on the economy and the lifestyle and the finances of the Cuban population. There is however a growing interest in self-employment with regards to retail and light manufacturing which the authorities seem keen to enhance and encourage in the future.

Interestingly, the major employment area in Cuba is tourism with the country attracting by far the largest share of tourists to the Caribbean. The vast majority of the 2 million tourists visiting Cuba each and every are from Canada and the European Union creating revenue of around $2.1 billion, something which is proving vital to the growth and the stability of the Cuban economy. There is still a significant agricultural sector in Cuba and many of the population depend upon this particular area of the economy to survive.

There are also housing issues in Cuba as the authorities have failed to keep up with growth in population and economy although this is something which is being addressed. Indeed, in 2010 the Cuban authorities announced plans to allow the population to build their own houses and improve existing developments, although these changes would not be endorsed by the state. While as recently as 2001 the average standard of living in Cuban was less than that during the Soviet dominated period of the country’s existence there have been changes of late.

It will come as no surprise to learn that Cuba is effectively an export driven economy with an array of natural resources and other products. The country has very strong relationships with China, Canada and the Netherlands together with a long-term association with Spain. The major export areas for Cuba are sugar, nickel, tobacco, fish, medical products, citrus and coffee. The country is also in the throes of any oil revolution with significant reserves found in the North Cuba basin.

Major cities in Cuba

As you might expect from the size of Cuba, there are very few leading cities in the country although the better known ones include:-

Havana

Havana is by far and away the largest city in Cuba, and is in fact the capital of the country, with a population of just over 2.1 million and a total area of around 721 km². While in relative terms this is a small city there is no doubt that it is one of the best known cities in the world and is indeed one of the few cities which overseas visitors are aware of before landing in Cuba.

Like so many areas of Cuba, there is a very strong link to Spain in relation to Havana with the first Spanish visitors landing back in 1510. This very strong link with the Spanish population continues to this very day although there is also a history with the British authorities and in particular the seven years war which began back in 1762. Cuba is a country which has changed hands, or changed influences, on a number of occasions and ultimately many of these influences are still very visible to this day. The climate in Havana ranges from around 25.8°C in January to a high of 32°C in August with the lowest rainfall in March and the highest rainfall in June.

The economy of Cuba as a whole is very much centred in and around Havana with exports playing a major role in relation to ship building, vehicle manufacturing, alcoholic beverages, textiles, and tobacco products to name but a few. There is also the world-famous Havana cigar industry as well as a significant fishing sector in the region. However, as we alluded to above there is a massive tourism industry in Cuba which is dominated by Havana. Many believe that tourism will allow the Cuban economy to push onwards and upwards and offers the best opportunity of long-term employment for those in the region.

Santiago de Cuba

Santiago de Cuba is the second largest city in Cuba with a population of around 470,000 and a total area of just over 1000 km². There is no doubt that Havana dominates Cuba both in terms of economy, tourism and is the best known city in Cuba. However, Santiago de Cuba does have something to offer with a comprehensive export industry which is complimented by the city’s close vicinity to the ocean.

Santiago de Cuba will always have a place in the hearts of Cubans as it was effectively the home of the revolutionary hero Frank Pais. Indeed it was in 1959 that Fidel Castro finally proclaimed victory for the Cuban revolutionaries from a balcony at the Santiago de Cuba City Hall. The city is also one of very few on the world heritage, list described as “the most complete, best preserved example of Spanish American military architecture, based on Italian and Renaissance design principles”. So while Havana continues to grab headlines perhaps Santiago de Cuba has more to offer than many people realise?

The cost of living in Cuba

The cost of living in Cuba is heavily influenced by the authorities who have a firm grip on each and every area of the economy. Poverty is still a major problem in Cuba and indeed up until just a couple of years ago the standard of living post the breakdown of the Soviet Union was actually worse than under the Cuban authority/Soviet Union partnership.

To give you an example of the cost of living in Cuba you can expect to pay around three dollars for a relatively inexpensive meal for one person at a restaurant while a meal for two at a mid-range restaurant could cost you up to $40. A domestic beer will cost around $1.5 and a bottle of Coke will set you back around one dollar, with water around 45c a bottle. The cost of everyday items such as milk, bread, eggs and cheese are heavily controlled by the authorities with milk around $3.5, bread around $1.60, eggs around $2.40 for 12 and cheese around five dollars for a kilo.

Historically it has been quite difficult to obtain detailed and accurate pricing information from within Cuba but since the onset of the Internet and the partial introduction of free-market trading there has been more information coming from within Cuba itself. Due to the shortage of housing, although this is something which the authorities are tackling, the cost of property will vary significantly from area to area and it is advisable that you do your homework before even contemplating a potential move to Cuba.

Conclusion

While it would be wrong to suggest that all issues and all problems with regards to the Cuban economy and the Cuban way of life have been tackled successfully, there is no doubt that good progress has been made over the last 50 years. The demise of the very strong relationship with the former Soviet Union led to a major rethink by the Cuban authorities and despite the fact it is still very much a socialist country, a number of free-market policies have been introduced to the economy.

There is no doubt that in the short to medium term the way forward for the Cuban economy centres around exports and the tourism industry. These are areas in which Cuba has great knowledge and great experience which has been used to benefit the country as much as possible. The price of goods and services in Cuba is still very much controlled by the authorities and while relocating Cuba may not be for everybody, many people expect significant changes in the short, medium and longer term.

The country itself is often overlooked due to issues in the past but this is an area of the world which has much to offer, is steeped in history and is very much a changing economy. If the authorities are able to maximise the position of Cuba within the worldwide trading environment then potentially there is significant upside for the economy, the people of Cuba and investment markets. However, at this moment in time poverty is still a major problem and likely to remain so for the foreseeable future.

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