economy and politics

Cuba begins to sell dollars with the aim of creating an exchange market

Cuba begins to sell dollars with the aim of creating an exchange market

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Havana (AFP) – Cuba will begin selling dollars to the population starting this Tuesday, August 23, authorities reported, 20 days after banks and exchange houses began buying foreign currency at 120 Cuban pesos with the intention of building a foreign exchange market in the country. .

“We are going to start selling foreign currency starting tomorrow,” Economy Minister Alejandro Gil announced during the state television program Mesa Redonda on Monday, August 22.

The measure is aimed at “building a foreign exchange market” in the country “that allows a legal exchange of currency, that allows progress in giving the national currency greater purchasing power,” Gil said.

With the intention of snatching dollars from the informal market, on August 4 last banks and exchange houses began to buy dollars at 120 Cuban pesos per US dollara rate that at that time was similar to the one in force in informality.

The sale of the dollar had been suspended since June 2021 due to lack of liquidity. The price of the US currency shot up almost five times in the illegal market after the government put into force a financial reform in January of that year, with which it set the price of the currency at 24 Cuban pesos.

Three weeks ago the authorities explained that, without having foreign currency to sell, they had to start only with the purchase.

The president of the Central Bank, Marta Sabina Wilson, said that the measure had “a favorable result.” In these 20 days, financial entities have “bought 10 times more foreign currency than they would have bought in a month with the exchange rate of 24” Cuban pesos.

But the sale of dollars will only be aimed at citizens, not at small and medium-sized private companies, he said.

“The exchange rate that has been taken into account (for the sale) remains at 120 Cuban pesos per currency,” Wilson said.

$100 limit per person

The sale of dollars will be limited to branches of Cadeca, the Cuban exchange housesbut local airports and banks will not be authorized for this operation.

These branches, located in the center of each municipality, will only “sell what they have bought,” said the president of the Central Bank, clarifying that each user will only be able to purchase up to 100 dollars.

This price of 120 pesos per dollar does not cover all economic activities.

The Government maintains two exchange rates in force, with which the official parity of 24 pesos will continue to be in force for transactions of state companies and other activities of the economy of the socialist island.

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