Between the few hours that Cuba was off the list of countries sponsoring terrorism and the return after the signing of the brand new Trump, some truly good news slipped in: having managed to renegotiate the debt that the country has with the so-called Paris Club, that had already been renegotiated in 2015, after decades in moratorium.
The arrival of Trump to the White House, from my perspective, will substantially increase the uncertainty, the fear, the caution of “doing business with Cuba”, of thinking about investment projects, of opening lines of credit.
I always tell myself that the toughest exercise that any Cuban government will have to face one day will be when the sanctions are eliminated; when some American Congress finally lifts the blockade and repeals the Helms-Burton Act.
Although the renegotiation with the Paris Club does not compensate for the fact that Trump has made salt and water on Biden’s late decision, renegotiating the debt offers us a magnificent opportunity and its positive effects go beyond the borders—and the wallets—of the member countries of the Club. .
The new agreement, of which the announcement is barely known, should help generate some confidence in potential creditors of the member countries and others, which is more than necessary if several years of negative growth, including the current one, are to be reversed.
Without growth, there will be no possible development, no reduction in poverty, or improvement in equity, unless it is equalized downwards—in which we are experts. And the promised prosperity will continue to be, at most, like the horizon, an imaginary line that moves away from us as we approach it.
Our country is trapped in a perverse circle of degrowth, motivated, among other causes, by this low GDP dynamic, which at the same time conditions the weakness of domestic savings, which leads to low rates of national investment in a loop that feeds again. that perverse circle.
To this we must add the well-known misallocation of scarce investment resources in sectors where they will hardly be recovered in the estimated time.
Not only foreign investment
Encouraging national and foreign private investment is one of the ways to break this perverse circle.
Giving the national, private and/or state investor the same opportunities that are discretionarily granted today to some foreign companies in the commercial sector, in the agricultural sector or in fishing and in infrastructure sectors should be a mandatory rule, because our country must grow with its own strength as well.
Finding new foreign partners will only make the effect lasting if the “national partners” join and are incentivized to join rather than pushed to leave.
The agreement with the Paris Club could be an opportunity; taking advantage of it in time will depend on the institutional capacity to convince current and future foreign creditors.
It will also depend on that same institutional capacity to create incentives for national investment, even when it is small, and to generate the confidence essential for these potential national investors to decide to risk their money in our market.
We are bad, it is very true, but we can do well. We don’t have to wait for them to “let us do it”; We have to do it, even if they don’t let us.
