From next Monday June 21st banks in Cuba will stop accepting US dollars.
The decision is attributed to Yamilé Berra Cires, the vice president of the Cuban Central Bank (BCC) during a television roundtable discussion in Havana.
The Cuban government is blaming the continued US embargo on the communist-run island which was tightened during the Trump administration after being relaxed by former president Barack Obama.
Reports out of Havana suggest that economic pressures in Cuba have gotten worse due mainly to the renewed Trump sanctions, to which there has not been any firm policy statement from the new Biden government.
President Biden has been overturning many of the policies he inherited from the Trump presidency.
BCC vice-president Berra Cires is quoted as saying, “It is even more difficult for Cuba to find international banking or financial institutions willing to receive, convert or process U.S currency in cash.”
Another central bank official advised travellers arriving in Cuba to have currencies other than the US dollar.
It's not known how long the restrictions will last.
According to international news reports, around 24 foreign banks have ceased dealing with Cuba while 95 other foreign financial institutions reported what they said were “transgressions” of Cuban national banks doing business with their competitors.
A statement said to have come from the Cuban government said: “In view of the obstacles that the US embargo creates for the national bank system to deposit abroad the US dollars that are collected in the country, a decision was made to temporarily suspend deposits in US banknotes in Cuba’s banking and financial system.”
The exchange for the US dollar is reported to have spared on the Cuban black market to around 70 Cuban pesos. The official exchange rate was pegged at 24 Cuban pesos to the dollar.
Suspending transactions in US dollars is another blow for Cuba which in the pre-Trump years had seen signs of growth in its economy, especially the tourism sector, following the Obama relaxation of some travel and financial dealings.
A recent rise in COVID-19 cases has further compounded the challenges for its vital tourism industry.
Cuba had previously been able to suppress the outbreak of the virus and is developing two vaccines which it’s already rolling out to its citizens.
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