The Associated Press December 22, 2010, 6:12PM ET

Cuba tries to ease worries about economic change

Cuban authorities on Wednesday tried to reassure the public that a raft of economic reforms allowing for more private enterprise will not spell the end of the communist island's hallowed social protections.

The overhaul -- which includes the slashing of half a million government jobs and the legalization of 178 private activities -- is the biggest change to Cuba's economic system since the early 1990s.

Since the changes were announced this fall, President Raul Castro has taken pains to stress they're necessary to save Cuba's cash-strapped economic system -- not meant to dismantle it.

In the state-run newspaper Granma, the government underscored that workers who take up one of the newly legal private-sector jobs will continue to receive free health care and education, as do all Cuban citizens.

"The expansion of self-employment in this country doesn't presuppose the worsening of conditions," the newspaper said. It added that the self-employed -- known here as "cuentapropistas" -- will also have maternity leave and retirement coverage.

The two-page article contrasted the emerging Cuban model to the situation in much of Latin America, where -- according to statistics cited by the paper -- nearly half the population works in the informal sector, many living hand-to-mouth with little or no social safety net.

"In Cuba ... conditions and guarantees (of the self-employed) are 180 degrees from those in other Latin American countries," the newspaper said.

Currently, more than 80 percent of Cuba's work force is employed by the state. Though wages are low -- averaging about $20 a month -- the government also provides for free education and health care, and nearly free housing, transportation and basic food.

A small private sector was authorized in the early 1990s during the economic crisis that followed the collapse of the Soviet Union, a key ally. But as the economy improved, the government reined in growth in the sector, largely freezing new authorizations for the would-be self-employed.

Under the new rules announced in October, licenses can now be granted for a vast swath of jobs -- from restaurateur to taxi driver; button maker to party planner. The government hopes the expanded private sector will absorb many of the 500,00 state workers to be laid off by next spring.

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Associated Press writer Andrea Rodriguez contributed to this report.


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