Cuba revalues convertible peso

Campaign News | Friday, 25 March 2005

Action signals a sense of optimism in economy

HAVANA March 24 - Reflecting optimism in the nation's economy, Cuban President Fidel Castro on Thursday announced an 8 percent revaluation of Cuba's "convertible peso," a currency that has long been pegged to the dollar.

Thursday's 8 percent revaluation comes on top of a 7 percent revaluation of Cuba's other currency, the regular Cuban peso, announced last week.

Fidel said the combined measures will significantly increase the value of the Cuban peso and improve the purchasing power of many of the nation's poorest people.

"We are going to collect and redistribute what we have to improve Cuban salaries," Castro said in a 3-hour televised speech before Cuba's political and military leadership.

Fidel's speech was the third in three weeks in which the 78-year-old leader projected optimism about the country's future after a decade or more of economic belt tightening.

During the talks, Fidel has promised that the nation's tattered electrical grid will be repaired and tha tens of thousands of pressure cookers and rice steamers will be distributed to the island's residents.

Fidel said the latest revaluation, which will go into effect April 9, was justified because of Cuba's improving economy, the dollar's sinking value in international markets and the need to shield Cuba from the Bush administration's tightening of economic sanctions against the island.

In recent weeks, Fidel has said Cuba's economic prospects are improving because of Cuba's close relationship with Venezuela, which is sending 56,000 barrels of crude oil daily at a sharp discount.

The international price for nickel, a key Cuban export, also has risen substantially, and Cuba is forging closer economic ties to China, which has promised to invest in the island's nickel industry.

At least two prominent billboards have sprouted up in Havana in recent weeks showing a smiling Fidel next to the words, "We are doing well."

"You get the sense that they have confidence in the Cuban economy," US Congressman Jeff Flake, of Arizona said Thursday in Havana after meeting with several top Cuban officials.

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