Cuba eliminates stumbling blocks in agricultural commerce

The government makes flexible non-state agricultural producers’ access to the market and does away with a large number of bureaucratic posts in the Agriculture Ministry.

The collection of agricultural produce stops being an activity monopolised by the State.

After testing it in three provinces, the government announced last July the elimination of the entity known as Acopio (produce collecting centre), a business group in charge of distributing agricultural productions, cursed for its inefficiency by farmers as well as by consumers. With this step, the Agriculture Ministry (MINAGRI) is advancing toward the de-bureaucratisation of the sector by doing away with more than 60,000 office posts.

The measure was expected. In an attempt to simplify the ties between the fields and the market, the authorities had undertaken a prior experiment in November last year in the provinces of Havana, Mayabeque and Artemisa. Backed by Decree 318, it gave the green light to those three western provinces’ producers to directly market part of their harvests in the retail and wholesale markets.

It did so with the explicit aim of suppressing the stumbling blocks that had existed for decades in the marketing process.

“Once producers have complied with the state contracts, they will be able to sell the rest of their production to whomever they want,” Roberto Pérez Pérez, head of the Agribusiness Policy Group of the government commission at the head of the changes in the economy, announced last November 2013. Any enterprise, retail as well as wholesale, can sign contracts for those productive surpluses, he specified.

In the press conference given at the time, Pérez Pérez also announced that the test would last a whole year before extending this practice to the rest of the country.

But the government evidently did not wait so long. Agriculture Minister Gustavo Rodríguez Rollero went ahead and in the session of the National Assembly of People’s Power held last July announced the extinction of the National Produce Collection Union (Acopio) and the transfer of the markets that were under its administration to the Domestic Trade Ministry (MINCIN).

Though Acopio had a bad reputation due to its inefficiency, the deterioration of produce because of delays in picking them up in the fields and taking them to the market and repeated losses in tuber and vegetable harvests because of its inability to transport them quickly, the step did not lead to total enthusiasm because neither does MINCIN have prestige as a commercial administrator.

But in any case the changes, directed at revitalising the agricultural sector, liberalise or make flexible the direct sale by producers in the markets. They also expand the so-called social object of the traditional cooperatives by authorising them to purchase from third parties to market these produce and encourage the formation of wholesale markets managed by non-state business forms, like the cooperatives recently created in non-agricultural spheres.

The new rules of the game offer producers greater participation in the definition of retail prices, an option that had previously been monopolised by the State and that now sets aside for itself a smaller group of foodstuff, like rice. This alternative can have an influence, however, in a greater resistance to lowering the prices, as confirmed by official studies and which consumers with a lower purchasing power regret.The cooperatives and other non-state agricultural producers will be able to directly sell their harvests to any buyer after complying with their contracts with state-run enterprises.

The close of the National Produce Collection Union eliminates mainly bureaucratic posts and is one more step taken by the Agriculture Ministry to compact its structures. Rodríguez Rollero told the deputies that the general reorganisation of his ministry makes it possible to reduce 41 percent of the staff of its central agency and of its provincial delegations. MINAGRI is eliminating 6,441 posts and stops spending more than 15 million pesos in wages.

The measures respond to repeated criticism regarding the appreciable imbalance in the excessive bureaucratic personnel predominant in one of the sectors of the economy that less contributes to the economy and to Cuban tables.

The head of the Standing Commission for the Implementation and Development of the economic changes, Marino Murillo, said that agricultural activities use around 20 percent of the country’s labour force, but according to official statics contributes 3.6 percent of the gross domestic product (GDP). Meanwhile, Cuba imports every year some two billion dollars in foodstuff, part of which – rice and beans – can be cultivated on Cuban lands.

The new measures expand the range of transformations that have had an early start, but still with scarce benefit, in a sector defined as strategic by the current government. (2014)

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