Cuba Has a New Exchange Rate, What Doesn’t It Mean? |
By Francisco Acevedo
HAVANA TIMES – Cuba rolled out a new exchange rate last Thursday, more than anything to wage war on the digital platform El Toque, so for the moment no results have been seen on the national economic scene.
The new rate will be floating and will coexist with the other two rates that remain officially in force and are fixed: the one operating at 1 dollar to 24 pesos (1×24) for state enterprises, and the one operating at 1 to 120 (1×120), more symbolic than anything else because it was supposedly the publicly accessible rate, but in practice no bank had the backing to exchange currency for the public and it only worked if you had a magic wand or a relative on the other side of the computer.
As explained by Juana Lilia Delgado, Minister-President of the Central Bank of Cuba (BCC), the new rate seeks to make it easier for “exporters and other suppliers of foreign currency to sell at a competitive price, determined by supply and demand.”
The BCC’s Director of Macroeconomic Policy, Ian Pedro Carbonell Karell, clarified that the 1×24 rate is for allocations made by the State on a case-by-case basis, and that the 1×120 rate will be used by certain entities also defined by the Government, based on their capacity to generate external income, while the floating rate (launched at 1×410) would be used by natural persons........