The reason for the agreement between Cuba and the US economy has become (Quartz, USA) Cory Bowles (Corey Boles), Rice Grace Targou (Risa Grais-Targow) © East News Xinhua / Roberto Chile / Cubadebate 12/20/2014 Diplomatic breakthrough in relations between the US and Cuba, of course, was the main achievement of the second term of President Barack Obama, but in reality the willingness of the island country to accelerate the pace of reforms due to the fact that Venezuela is no longer able to provide it with financial assistance in the previous volumes. Faced with a liquidity crisis and the aggravation of the economic difficulties in Venezuela, Maduro mode to sharply reduce the amount of assistance it provides to its neighbors in Central America and the Caribbean in accordance with the program of the alliance Petrocaribe. Caracas prospects look bleak, and many analysts believe that next year the country will face the risk of sovereign default, if global oil prices, the proceeds of which are the backbone of the economy of Venezuela, rises again. According to forecasts, this year and next year, Venezuelas economy will be reduced by at least 4%. The inflation rate in the country is now 63%, and next year could reach triple digits. At the same time the dollar shortage has forced the government to drastically reduce the volume of imports, which led to a shortage of many goods and plummeting popularity of President Nicolas Maduro (Nicolas Maduro). According to a recent poll conducted by the Centre Datanalisis, the presidents rating is only 22% and 84% of respondents believe that their country is heading in the wrong direction. Given that this year the price of oil fell by 50%, countries such as Venezuela, whose economies depend on oil sales, suffered huge losses. In accordance with the alliance Petrocaribe Venezuela sells oil to its neighbors in the region for a very generous payment terms. In the case of Cuba, Venezuela before supplies about 100,000 barrels of oil per day, which is significantly higher than the daily needs of this island nation. This gave Cuba the opportunity to sell the difference - which, according to some estimates, is about 40 million barrels a day - on the open market and use the proceeds at its own discretion. However, more recently, Venezuela began gradually to curtail the program to provide financial support to Cuba and other allies in the region because of the rapidly growing financial difficulties she faced. In the case of Cuba, according to some estimates, the volume of oil supplies from its once-wealthy neighbor has decreased by 25% over the past year. Given what is now Venezuela has to sell oil at $ 53 per barrel, this trend is likely to continue - there is no doubt that Raul Castro (Raul Castro) was guided by these considerations in deciding to enter into an agreement with the United States. The agreement, which on Wednesday, Dec. 17, at the same time announced Obama and Castro most likely will not be a turning point, making this island state firmly on the path of democratic reforms and to open its market to foreign investment - although in Cuba this step, of course, will cause a new wave of appeals facilitate its access to the US and other markets. Nevertheless, Cuba will be able to benefit from strengthening commercial ties (even if the United States does not lift the embargo) and access to multilateral funding. This turning point may come when Raul Castro hand over the reins to his alleged successor Miguel Díaz-Canel (Miguel Diaz-Canel), which, according to many, is an advocate of reform. Diaz-Canel, who currently holds the post of vice-president, just 54 years old, that is, it can be called a relatively young leader compared to the Castro brothers. He is increasingly becoming the public face of public policy, including the reform program, and in the case of coming to power, he is likely to accelerate the pace of economic reforms. It is worth noting that, according to press reports, Pope Francis has assisted in the negotiations between the Obama administration and the Castro regime. Undoubtedly, his attempts to help Cuba goes back many years, when we remember that before he was a cardinal in Latin America. Given all the above, Cubas readiness to conclude an agreement with the United States, which a few months ago seemed impossible, proves the dependence of Havana on the economic bounty of Venezuela and the rapid deterioration of the Venezuelan economy. It is logical to assume that the increase in access to the US market and the emergence of new opportunities for Americans to come and do business with their neighbor island will reduce Cubas dependence on Venezuela at sunset half-century reign of the Castro brothers. Original publication: Papal assist aside, economics are the reason Cuba ditched Venezuela for America Published: 12/19/2014 qz/315822/papal-assist-aside-economics-are-the-reason-cuba-ditched-venezuela-for-america/
Posted on: Sat, 20 Dec 2014 14:47:18 +0000
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