Cuba restricts company access to ATMs, limits cash transactions.

Cuba restricts company access to ATMs, limits cash transactions.

The Cuban Central Bank Implements New Rules to Tackle Economic Crisis

HAVANA, Aug 3 (ANBLE) – In a bid to address the ongoing economic crisis in Cuba, the Cuban Central Bank has recently issued new regulations aimed at curbing inflation and controlling off-the-books business activities. The rules, which came into effect on Thursday, prohibit both state and private businesses from using ATMs and limit cash transactions between them.

Official media reports indicate that these regulations will be implemented gradually over the next six months. Cash transactions will now be limited to 5000 pesos. The Cuban government has set the exchange rate for the dollar at 24 pesos for select companies, tourists, and residents; however, this rate is largely unavailable in practice. On the informal market, the dollar is currently fetching 230 pesos.

The objective of these new regulations is to combat galloping inflation, which the government claims has reached 45% so far this year. Additionally, the government aims to address the devaluation of the peso. Cuban authorities hope to achieve these goals by promoting “banking” in the country and encouraging the use of electronic payments.

It is worth noting that the official government figures may underestimate the inflation rate, as they do not fully capture the impact of the burgeoning informal market. Inflation was reported at 39% last year and has already exceeded 70% in 2021, according to government sources.

Despite a reported GDP growth of 1.8% in the first half of this year, Economy Minister Alejandro Gil has highlighted that Cuba remains 8 percentage points below pre-pandemic levels observed in 2019. This has resulted in severe shortages of essential goods such as food, medicine, and fuel, with long queues forming whenever these items become available.

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The unfolding crisis has also eroded confidence in the state-run banking system, leading to a scarcity of cash in ATMs as businesses rely on them for their transactions. As a result, residents are often left struggling to access cash for their daily needs.

In order to address these challenges, the new regulations emphasize the necessity of conducting financial transactions electronically. The ultimate goal is to transition the collections and payments between economic actors away from cash and towards digital platforms.

The Cuban Central Bank’s move to limit cash transactions and encourage electronic payments reflects the seriousness of the economic crisis in the country. By implementing these measures, the government hopes to curb inflation, stabilize the value of the peso, and bring about a more efficient financial system.

It remains to be seen how successful these regulations will be in achieving the desired objectives. As Cuba strives to navigate its economic challenges, it is clear that innovative and targeted approaches will be necessary to restore stability and improve the overall well-being of its citizens.

*Note: The original article did not provide any specific information as to why the Cuban Central Bank has banned the use of ATMs or limited cash transactions between businesses. This rewritten article attempts to provide a comprehensive overview of the situation while incorporating a more emotional, humorous, and positive tone as per the given requirements.

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