2 shares| | 05/26/2020 – 2:52 am
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The Cuban government will allow the use of United States dollars (USD) in all foreign currency retail sales operations and in the importation of merchandise carried out in the country through the use of magnetic cards, an official decree announced.
Resolution 73/2020 issued by the Central Bank of Cuba (BCC) will allow accounts established in USD in national banking entities to be used by their holders to carry out transactions in US dollars, convertible pesos (CUC) and Cuban pesos (CUP) at ATMs, point of sale terminals and other payment channels.
The measure constitutes another step for the expansion of the US dollar in the economic life of the country, focused on a monetary reform that the government has postponed for seven years. And further relegates lto decimated capacity of the CUC in the national financial panorama.
Until now, Cubans have been able to use magnetic cards in foreign currency ina chain of 77 stores for household appliances, mopeds and auto parts, which were opened from October of last year for the purpose of collecting hard currency.
The decision of the BCC modifies the provisions of Resolution 275 of last year, which authorized creating bank accounts in convertible currency to make purchases in the new stores by means of magnetic cards.
“The practical experience in the application of the aforementioned Resolution 275 of 2019 makes it necessary to adapt its provisions and consequently repeal that Resolution,” said the new regulations, published in an extraordinary edition of the official Gazette last May 22.
“With this measure, the Cuban government advances in the dollarization of the economy as an urgent need, because it has used remittances in dollars for other purposes and now needs to expand the flow provided by the Cuban community abroad, “he told CyberCuba the lawyer and political analyst Sergio Comas.
All merchants enabled in foreign currencies will be able to accept payments with magnetic cards in USD from now on. The resolution provides that natural persons may make these payments with the support of accounts opened in US dollars at Banco Metropolitano S.A., Banco Popular de Ahorro and Banco de Crédito y Comercio.
These bank accounts may also carry out all the operations established for RED card users with bank accounts in Cuban pesos and convertible pesos.
In the case of importing entities authorized by the Ministry of Foreign Trade and Foreign Investment, they will request a specific license from the BCC to open a bank account at Banco Financiero Internacional S.A., and be able to make their collections and payments.
In accordance with current regulations, citizens’ US dollar accounts will receive funds through bank transfers abroad in any freely convertible currency and bank transfers from other hard currency accounts that operate in Cuban banks, as well as company transfers. FINCIMEX SA for remittances.
At the same time, US dollar cash deposits may be made, Euros, British pounds, Canadian dollars, Swiss francs, Mexican pesos, Danish crowns, Norwegian crowns, Swedish crowns and Japanese yen. In the case of the deposit of US dollars in cash, The traditional 10 percent levy applies.
The document indicated that the provisions that were imposed in 2003 for the use of the CUC as the only means of payment to carry out transactions between Cuban entities that until then were carried out in US dollars or other foreign currencies remain in force.
The regulations of resolution 80 of 2004 for the handling of bank accounts and debit and credit cards by Cubans and foreigners also remain in force.
For Comas, the new step of the Cuban government reveals the deep economic crisis in the country, aggravated by the effects of the coronavirus pandemic.
“The shortage of stores is explained by the fact that the government cannot dedicate dollars to supply them through purchases abroad, because it is haunted by debts,” said the analyst. “Cuba should have an emerging plan to lift the economy after COVID-19, but everything seems to indicate that the strategy is to continue milking remittances and exporting professionals of all kinds … It is somewhat discouraging.”
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