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CUBA'S BANKING CRISIS: MACROECONOMIC ANTECEDENTS, PRINCIPAL CAUSES, AND RECENT POLICY RESPONSES
Abstract
Conditions in Cuba's banking and financial sector have deteriorated significantly caused by a balance of payment crisis, de-dollarisation, the centralisation of hard currency transactions, and a fixed exchange rate regime. The crisis has negatively impacted the real economy, particularly the availability and cost of credit, the influx of foreign direct investment, and the country's international trade. The most visible consequence of the crisis is the growing scarcity of consumer goods, particularly in the case of imported products and inputs, that is affecting the nation's wholesale and retail distribution systems. Cuba responded to crisis by implementing a strict austerity programme, fiscal transformations, and institutional and structural changes. So far, these changes appear to be insufficient, and more profound economic transformations are required to surpass the crisis, while retaining the positive elements of the Cuban model, particularly on the social front.
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Vidal Alejandro (2008) González-Corzo (2006)
Luis (2010)
Torres (2008)
Espina (2008)