Cuba opening door to more private enterprise

Agency leasing space to eateries, salons

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Cuba’s National Assembly is due to meet next Monday in one of two yearly sessions, though there is no indication whether it is ready to approve more changes under guidelines approved by the Communist Party last year.

“There has been a certain deceleration in the rhythm of the implementation of the guidelines in the first half of 2012, but that doesn’t mean things are paralyzed,” Omar Everleny Perez, the head of Havana University’s Center for Cuban Economic Studies, told the Associated Press.

‘We’re giving them the space’

Those like Mr. Perez who see the glass half-full point to projects like Mr. Leal‘s, and other pilot programs launched in other regions of the country, as potential blueprints for the future — even if they are barely mentioned in the local press and rarely talked about by high-ranking government officials.

With zero fanfare, Mr. Leal’s office recently has leased five storefronts in five- to 10-year deals renewable by mutual consent, with an initial three-month rent holiday while tenants are still getting off the ground.

For up to a year, business owners can deduct whatever they spend on improving the space from their rent payments, said David Viciedo, an economist who works for the Historian’s Office.

“We’re giving them the space, not just the legal but the physical space,” Mr. Viciedo said. “The office made the decision to do this experiment with five trials even when it was not being done in the rest of the country. We will do it with five, and propose to extend it later.”

So far there has been no public bidding process or published rental rates during the program’s pilot phase. The first five Old Havana renters have long ties to the Historian’s Office and the government, and the office will have to avoid favoritism, real or perceived, if regular Cubans are to be included.

Mr. Hernandez, for one, has been chef to Fidel Castro and visitors such as Gabriel Garcia Marquez and Arnold Schwarzenegger, and he founded several prominent state restaurants. His monthly rent of about $700 far undercuts the $1,500-$2,000 that other independent restaurateurs say they pay to rent space in private homes elsewhere in the city.

Mr. Viciedo acknowledged that Mr. Leal’s office picked people it already knew, but he said that was because it wanted people with an established record of success for the program’s trial phase.

He said pricing will be made public as the project expands to ensure everyone has a fair shot, not just the well-connected.

“We intend the process to be not just for people we know, because it has to be much more participative,” Mr. Viciedo said. “It shouldn’t be like that. It won’t be.”

Fledgling project

The project would seem to fly in the face of Communist Party ideals that have reigned in Cuba since shortly after the 1959 revolution, after which nearly all private businesses and retail space passed into state hands.

What were an estimated 60,000 retail outlets islandwide at the time of the revolution hit a low of 4,000 in 1993, the great majority state-owned, said Joseph L. Scarpaci, executive director of the Center for the Study of Cuban Culture and Economy, based in Blacksburg, Va. That number has since crept back up to just about 10,000.

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