Monday, April 27, 2015

The “Normalization” of Relations with Cuba

Now that there has been some normalization of relations with Cuba there are some things to consider about the island nation before thinking of pursuing this market.

Most businesses and properties are still government owned and privatization will take place at a very slow pace. The big problem with Cuba is the lack of technology, mainly the internet. Internet availability beyond usage by the government is only at about 22%. Up until 2008 people weren't even allowed to buy their own computers. So if you have or have access to a laptop or tablet of any sort, you are probably a government worker or in some type of intelligence department. Most only have access to a radio if that.

Due to the way the country has been and is still functioning, in Cuba an average worker makes the equivalent of about $20 a month. As most rent and living expenses are still subsidized by the government, Cubans are still worried about paying for the basic necessities and don’t have any spending capital. Those who have been able to visit Cuba in the recent past comment on the old fashioned cars they still drive. So the latest trends are not known or have been lost there.
Businesses - the few that exist - have little disposable income. And Cubans, don’t want to attract businesses simply to make money. There will be bureaucratic red tape and you will likely have to deal with a local intermediary if they will accept you. All business deals between Cubans and foreigners, as well as any formal business deals between Cubans themselves, are made with the explicit knowledge and approval of the Cuban government and its structured more for socialism than open capitalism. Any “business” has to meet both the social and economic need in the country, determined by the state and not simply the consumers, so most entrepreneurs have to check their egos at the door and be prepared to do things the Cuban way.

Even hotels and restaurants have limited services and are owned by the government as a way to get hard currency. And it’s all cash. Due to the fact there’s no real viable internet and most don’t even have bank accounts, credit card machines and other means of electronic payments are few and far between.

But if you are forward thinking and venture out and try to break into the market, consider a translation vendor with access to Cuban Spanish linguists. The unique political situation today has led to the development of words which are specific to modern Cuban culture. There will be many different preferential words for things, words that aren’t the most widely used in other Spanish speaking locales. Over the years of being isolated, the language has become debased by "street" language rather than any foreign influence. It's also become very pedestrian, although a normal "high" register of language can be expected in formal and business communications. English is known by some but used more in the hospitality and recreational industries.

Bottom line, even though there is much talk about Cuba opening up, we may not see a great commercial sector to play with right away.  

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