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Cuba relies on dollar even more

International 02 Sep, 2020 Follow News

Cuban currency is tanking under lockdown

Cuban government policy is relying even more on the US dollar back while the CUC takes a dive.

Cuba has three currencies circulating, but most Cubans receive salaries in only one, the regular peso CUP. The CUC was originally introduced in 2004 and is what most tourists use on the island.

Most stores selling in CUP or CUC have empty shelves as the government prefers to stock its new dollar stores. This benefits Cubans with family abroad and the government itself, whose military has a monopoly on retail sales.

The CUC, once on the par with the US Dollar, appears on its way out and people want to convert them to dollars. The dollar is now trading on the street for 1.50 CUC and in some cases even more.

If basic products were available in the Army’s stores selling in CUC, the currency wouldn’t be so unpopular. But the reality is that the only stores well-stocked are those selling in US dollars on bank cards.

Economists believe that of the two Cuban currencies, the old peso, which exchanges at 25 to one CUC will survive. They also see the once despised dollar playing an ever-greater role in the government’s survival economics.

With Cuba closed for months to tourists and Cubans living abroad, the flow of dollars into the country plummeted. With the surge of new Covid-19 cases, especially in the capital, dollars will soon be even scanter.

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