New Cuban law allows citizens to buy, sell property

By: Miriam Arias/Staff Writer

Raul Castro is giving back to the Cuban people what his brother Fidel took away more than 50 years ago.

The administration of Raul has approved a law allowing the Cuban population to buy and sell property. The new law took effect on Nov. 10.

Since April 2011, the Cuban Communist Party has been adopting new sets of lineamientos, or guidelines, which encourage a shift from a command economy towards a more mixed one.

Associate professor in the College of Law Jose Gabilondo believes this law is good because of the doors it opens for Cuban people.

“Anything that creates new choices for people – in this case in terms of real property – is good,” said Gabilondo in an interview with Student Media.

While beneficial to the Cuban economy, the people who have long awaited such law will still face certain government restrictions and regulations.

Buyers will be allowed to buy up to two homes and all financing must be made through Cuba’s Central Bank, which will charge fees along with an eight percent tax rate to be split by buyer and seller.

The policy also includes a threat of prison for those who lie about the true value of home prices.

The implementation of this new law has also given rise to questions of class divisions in Cuba.

According to Jose Gabilondo, economic inequality has been unquestionably affecting Cuba particularly in the last decade as sectors of the economy become “dollarized.”

Dollarization occurs when residents of a country use foreign currency alongside or instead of domestic currency.

This dollarization marks a significant division among classes since it benefits those who earn their living from dollars, but leaves those who are still dependent on the peso a step behind.

“The new law may set the stage for the kind of economic inequalities that are common in capitalist economies, but in a way that may be more systematic than dollarization,” Gabilondo said. “That said, it is undeniable that Cuba’s liberalizing reforms of its economy are on a crash course with its socialist commitments to distributional equality.”

Gabilondo pointed out that though people are expecting forms of social displacement to ensue in Cuba such as increased economic security, the greatest problem will be that of the people’s unmet expectations.

Not all will benefit; some will continue to find themselves surrounded by immense poverty.

He also mentioned Cuba’s isolation due to the U.S. embargo which led to economic unrest and added to the overall poverty found in the country.

While it might not all seem positive right at first, Gabilondo feels allowing people to own and sell a home is definitely a step in the right direction. Students and faculty interviewed for this story tend to agree on this.

“It’s a step forward for the Cuban people,” said sophomore and criminal justice major Diego Saldana.

Sophomore history major Marlon Velez agrees with Cuban economists who favor economic liberalization for the country because the buying and selling of property will lead to the ownership of small businesses and private agriculture.

“Communism has proven to be ineffective and if Cubans are now allowed to own and sell property, who knows if they’ll eventually be able to even own businesses leading them to a more capitalist economy,” Velez said.

While the new law shows positive change towards the overall development of Cuba, there are numerous regulations that will restrict this private ownership.

What seems to be the most prominent problem revolves around adjustment.

Cubans must adjust to this new law which will most likely show its benefits for the country in the long-term rather than in the near future.

“Though possibly not initially popular, the trend of the incremental reforms put in place by Raul Castro’s government is towards an economic system that will make it easier for Cuba to adjust to the global economy,” concluded Gabilondo.