The x-ray that this Friday is carried out by the provincial newspaper of Camagüey, Aheadto the new business fabric of MSMEs exposes all the defects with which the rules for creating businesses on the island were born. The situation is such that Miguel Hernández Fernández, a member of a local project created to promote entrepreneurship in the province, warns: “The level of failure in Latin America it is around 80%; if many of these conditions do not change, the numbers in Cuba will exceed 90%”.
The reportagetitled One year, many problems, few productionsbegins by warning of the difficulties that small and medium-sized companies have in most of the world to establish themselves, but little by little the causes of the endemic ills of the Island are being found.
The outlook, one year after the approval of the MSMEs, is as follows: 181 companies –all private except one– received the go-ahead, of which 123 have no activity, 68%. The causes are, advances the text, the high prices to acquire or condition a premises and the scarcity of raw materials. But as the report progresses it becomes clear that political will is enough to solve some of the problems.
“Here they come with very good ideas, but either Decree 49 prohibits them, or the national qualifier of economic activities, or they cannot carry out direct foreign trade”
“Among the main disagreements is the delay in approval and the limitations on those of a professional nature. Here they come with very good ideas, but either Decree 49 prohibits them, or the national qualifier of economic activities, or they cannot carry out foreign trade directly,” says Ernesto Figueredo Castellanos, an official in the economic area in the province. Both issues could be solved with a change in the law, but the State’s effort to maintain control is one of the great ballasts.
The lack of foreign currency is not a minor problem, which is essential for these new entrepreneurs to be able to buy products, among other things, but which is impossible to access because, simply, the banks do not have it. The official goes so far as to admit that, under these conditions, merchants can only replenish themselves with donations or by resorting to the black market. In turn, they recall, buying from the left is not a real option, since “the traceability imposed as a company does not allow them, for example, to look for flour on the street, and many have had to import it”.
The result is that it becomes almost impossible to acquire what is necessary. One of the business cases exposed in the text is that of a cafeteria that explains how they are forced to even bring water from outside because the state companies do not sell them. “They force us to go to the retail market or to import, and it is money that leaves the country and that there is no mechanism to enter it into my accounting, in addition to making the costs more expensive, without adding the rent,” says Pedro Céspedes Aguilar, partner of Alegre SRL.
Another of the complaints that entrepreneurs point out is that only one type of association is allowed. “Limited representation companies (SRL), you can only invest in one and be an administrator of one. Cuban citizens residing abroad are not authorized to be partners, which generates unreported partners outside the country, because under the conditions Current Cubans need liquidity to carry out their activity and import,” continues Figueredo Castellanos, who is highly critical of the regulations.
“Limited representation companies (SRL), you can only invest in one and be an administrator of one. Cuban citizens residing abroad are not authorized to be partners”
The interviewees warn that the leasing of premises is excessive. It is the state companies that offer them and they are between 80,000 and 120,000 pesos, a price that makes the business excessively expensive. Hernández Fernández complains: “It seems that the companies want to solve the financial problems with the rents.” In addition, the specialist regrets that the level of computerization is still low for what is required. The process of registering a MSME it is done through a digital platform and without the help of officials, and most lack the necessary knowledge.
“Communication with the Ministry of Economy is another matter to improve. During this investigation it emerged that the interested parties write and often do not respond to them,” the text adds.
“In Camagüey, it is urgent that the government work to interconnect these actors with the rest of the local economy and achieve a true relationship that enhances the territorial development strategy. There are very good examples in Villa Clara and Havana that we could well implement here” , demands Hernández Fernández.
This is how Chefmigue has managed to survive, a company that started producing when it was one year and one day approved. Their goal was to produce fresh pasta, but the price of flour has forced them to change their minds and they have ended up processing fish to make shapes that they sell to a state company. However, they are not without problems. Among their demands is that they be authorized to import fishing gear or invest in fishermen to obtain the best raw material. “The difference between the black market price and the one offered by the Fisheries is abysmal and the best fish do not reach us. Lowering my costs would lower the price for the population,” they claim.
“There cannot be a divorce when chains are urgently needed to increase the offer of goods and services to the people of Camagüey. We do nothing with which the obtaining of the 64 MSMEs dedicated to food production are not seen to go to informal distribution schemes or outside the province. To achieve this, they must be given the same attention as the state company,” she explained in a meeting with businessmen Yoseily Góngora López, governor of Camagüey.
“If I could directly import the flour, I would lower the cost of production and the price with which it reaches the population, which is that cost plus a 15% margin”
The flexibility to import is the common trend of the majority of businessmen who appear in the report. “If I could directly import the flour, it would lower the cost of production and the price with which it reaches the population, which is that cost plus a 15% margin,” says Dayron, one of the creators of Marfoxi, which produces cookies, breads and other derivatives of flour. The businessman points out that the lack of electricity makes him lose time, so he is now working on creating his own mill.
For Madiú Quiroga Gómez, head of the Provincial Territorial Development Group, several demands should be satisfied next year if progress is to be made. “The new players need the possibility of making international collections and payments backed in ‘hard’ currencies and thus avoid the outflow of cash abroad; favor the conclusion of contracts and bidding for business opportunities, with transparency; promote the national investment of the Cuban economic actors and above all to develop training courses and spaces, since there are people outside the current legislation,” he asks.
The newspaper ends the text by urging the State to get involved in the solutions, but without letting go of control, as requested by those interested. “You have to build it from the control of the State, the coordinating role of the Government and the ties of collaboration between the state and private companies to ‘row’ evenly towards a sustainable and sustainable economy,” he requests.
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