HAVANA – Cuba says its budget deficit came in far below forecasts in the first half of 2010, evidence that tax increases and deep spending cuts on food imports may be helping the communist government weather a severe economic crunch.
Cuba reported on Thursday a deficit of nearly $410 million for the six-month period, less than a quarter of the $1.7 billion that central planners originally predicted.
CUBA’S FOREIGN DEBTAs of the end of 2008, Cuba’s total known foreign debts in convertible (hard) currencies had grown to nearly US$31.7 billion from a previous estimate of US$23.8 billion at the end of 2007. The depreciation of the U.S. dollar vis-à-vis the euro, Japanese yen, and Canadian dollar accounted in part for the substantial increase of the debt in recent years. More so, new borrowing by the Cuban government and state-owned enterprises has added billions of dollars to the country’s already large public debt, much of it in default, at a rate that seems unsustainable. Long-term financing, provided through a series of strategic cooperation accords with the Chávez administration, has enabled the island to import more than 90,000 bpd of Venezuelan petroleum and refined fuels at an estimated additional burden of US$3.4 billion to the island’s national debt in 2008 alone. Total Cuban obligations to Caracas now exceed US$11 billion.
Other political allies of Cuba, such as China, Iran, and Vietnam, have collectively extended more than US$2.5 billion in new bilateral commercial credit, backed by their respective governments, in recent years. European, Japanese, and Latin American lenders and suppliers also continue to offer US$2 to $3 billion annually in short to medium-term financing either directly to Cuban clients or to foreign businesses operating in, or trading with, Cuba. Regarding its non-convertible debt originating in the Soviet era, the Cuban government does not acknowledge demands by Moscow or other former trading partners in Central and Eastern Europe, claims amounting to over 20 billion transferable rubles. Havana has likewise refused to service its historic long-term debt, originally to Western European, Argentinean, and Japanese creditors and subsequently absorbed by their respective governments, ever since Fidel Castro declared a moratorium on foreign debt repayment in 1986 and called on other borrower nations to follow Cuba’s lead. Certain former socialist trading bloc nations, among them the Czech Republic and Romania, have converted their Soviet-era transferable ruble claims against Havana into convertible euro-denominated debt, suggesting that such creditor governments may seek compensation at a later date.
Ziva, fwiw, the annual “deficit” is not the same as the overall national “debt”. It is apples and oranges, though of course any annual deficit will ADD to the overall debt.
By the way, your first link did not work for me. Presumably you meant to link to something like this?
http://cubajournal.blogspot.com/2010/07/cuba-deficit-lower-than-expected-for.html
Fuzzy- I understand basic accounting principles and know that the national debt is not included in the deficit calculation. However you missed my point, and that is that Cuba is bankrupt, and their entire “revolutionary” financial system is a fraud. Their reporting methods are not normative, so apples and oranges are moot.
I fixed the link to the AP article, and you might want to read this:
http://www.ibtimes.com/articles/38637/20100727/cuba-economy-embargo.htm
And btw Fuzzy, Cuba Journal is a mouthpiece for the regime.
Ziva, the AP link still does not work. At least, not for my account. Maybe the change takes time to appear and it still will, or perhaps what you see as a “mod” is different from what regular readers see?
Cubajournal may well be a “mouthpiece”, but what I linked to was a short 7 or 8 sentence article that seemed to be reporting exactly what you were alluding to in your first post.
In fact, its first two paragraphs were IDENTICAL to what you posted, and the remainder is along the same lines. Indeed, it appears to be an article copied word for word from the Associated Press (AP). I suspect it is word for word identical to what you are trying to link to.
I suppose I should have said “contributor” rather than “mod” but I trust you understand what I meant. Though, for all I know, you may have “mod” authorities.
I don’t know why the link is not working but here is the article.
http://news.yahoo.com/s/ap/20100729/ap_on_bi_ge/cb_cuba_economy_1
It may well be the same, as Cuban state press releases are perpetuated by all the MSM. However I will not link to Cuba Journal. Other than being your usual snide pointless self, are there any further questions?
Right on, Ziva in your last sentence above!
How do the Cuban people get back the billions stolen from them when the revolution is overturned?
And I had no trouble linking to the article.
“How do the Cuban people get back the billions stolen from them when the revolution is overturned?”
Honey, don’t ask. They don’t.
And to think that the US farm lobby and some in Congress want to “lift” the embargo to, in effect, extend credit to the Cuban Government… le zumba el mango!
Yet, I ask what was the Chinese chancellor, Yang Jiechi, doing meeting Castro this week. Given that the sect-camp is indeed bankrupted (and owing China) I suspect it is a great moment for the Chinese to renegotiate and buy Cuban minerals (or whatever) at dirt cheap prices. Would it not? Hey, their is no sale like a going out business sale.
Also, upon such visit the half dead national cancer, egomaniac, sect leader, and overall piece of human garbage, gave the Chinese man no better gift than a shitty book of “his persona and accomplishments”, written by the fraud himself, of course. Yes, Castro giving the Chinese a book on his persona and accomplishments. Seeing the economically retarded and pathetically ruined state that is Castro’s Cuba I am sure the post-Mao Chinese are extremely anxious to read about Castro’s advises and accomplishments, dear god. Rest a sure, the chino must have been “Coño, la verdad que está patetico esto aqui…”.
At the end of the day China is no Venezuela here. They don’t care for Castro, echoing his outdated soviet brand of garbage, Cuba, or who runs that nation as long as they can buy what they want. Yet, the communist destruction has been such that I truly can’t imagine any sale of much either (at the continued expense of Cuba) for these communists to get out of such economic hole. Hell, the place is even importing sugar, what more can be said.