Resolution Issued by the Central Bank of Cuba on Currency Rate
The Monetary Policy Committee at the Cuban Central Bank decided to devalue Cuba’s hard currency (CUC) by eight percent against all foreign currencies as of Monday, March 14, 2011; thus making the CUC on par with the USD
2011-03-14 | 15:25:29 EST
Resolution No. 30/11 Issued by the Monetary Policy Committee of the Central Bank of Cuba
In 2005, thanks to a robust international economic and financial situation and a series of factors that were contributing to Cuba’s economic growth, the national authorities decided to revalue the country’s hard currency, the Cuban Convertible Peso (CUC), by eight percent against all foreign currencies, including the US Dollar (USD). From its introduction in 1994 to April 8, 2005, the CUC had been pegged 1:1 to the US dollar (USD).
The current state of Cuba’s national economy —aggravated by hurricanes in 2008 and the international economic crisis characterized by market instability— required a revaluation of currency exchange strategies to reconsider whether it was prudent to maintain an exchange rate with foreign currencies that was not consistent with the current national economy.
After analysing these factors, the Monetary Policy Committee at the Cuban Central Bank decided to devalue Cuba’s hard currency (CUC) by eight percent against all foreign currencies as of Monday, March 14, 2011; thus making the CUC on par with the USD.
This decision represents a modest step towards creating a more positive balance in terms of hard currency in Cuba, which will encourage national exports while stimulating the process to substitute imports with domestic production. Concurrently, steps are being taken towards more effective economic planning, streamlining hard currency management and allocation, improving money circulation, and boosting economic productivity and efficiency at the national level, which will help produce more favourable external economic conditions.
As announced during the Sixth Session of the Seventh Legislature of People’s Power National Assembly, in 2010 the restrictions on financial transactions and payments from national banks to foreign suppliers, which Cuba was forced to impose near the end of 2008, continued to decrease. In addition, significant progress has been made in renegotiating debts with Cuba’s principal creditors.
Considering the above, the new official exchange rate between the CUC and the USD has been fixed at 1 x 1, effective today March 14, 2011, throughout the Cuban territory. This is valid for both exchange operations made within the business sector as well as those made at currency exchange houses (CADECA).
Commercial fees applied on exchange transactions will remain unaltered to cover the costs of the financial institutions offering these services.
The 10 percent penalty on cash purchases of convertible pesos with US dollars stays in place to compensate for the financial costs and risks to the nation’s economy as a result of the irrational and unjust US economic, financial and commercial blockade of Cuba, in place for more than half a century by the US government.
The exchange rate for CUC-Cuban peso at the CADECA exchange houses remains the same: CADECA will purchase 1 CUC at a cost of 24 Cuban pesos, and sell 1 CUC at a cost of 25 Cuban pesos. The measure does not affect official Cuban peso-CUC exchange rates applied on transactions made within the business sector, which stipulate that 1 Cuban peso is equivalent to 1 CUC.
Ernesto Medina Villaveirán
Minister-President
Central Bank of Cuba
In 2005, thanks to a robust international economic and financial situation and a series of factors that were contributing to Cuba’s economic growth, the national authorities decided to revalue the country’s hard currency, the Cuban Convertible Peso (CUC), by eight percent against all foreign currencies, including the US Dollar (USD). From its introduction in 1994 to April 8, 2005, the CUC had been pegged 1:1 to the US dollar (USD).
The current state of Cuba’s national economy —aggravated by hurricanes in 2008 and the international economic crisis characterized by market instability— required a revaluation of currency exchange strategies to reconsider whether it was prudent to maintain an exchange rate with foreign currencies that was not consistent with the current national economy.
After analysing these factors, the Monetary Policy Committee at the Cuban Central Bank decided to devalue Cuba’s hard currency (CUC) by eight percent against all foreign currencies as of Monday, March 14, 2011; thus making the CUC on par with the USD.
This decision represents a modest step towards creating a more positive balance in terms of hard currency in Cuba, which will encourage national exports while stimulating the process to substitute imports with domestic production. Concurrently, steps are being taken towards more effective economic planning, streamlining hard currency management and allocation, improving money circulation, and boosting economic productivity and efficiency at the national level, which will help produce more favourable external economic conditions.
As announced during the Sixth Session of the Seventh Legislature of People’s Power National Assembly, in 2010 the restrictions on financial transactions and payments from national banks to foreign suppliers, which Cuba was forced to impose near the end of 2008, continued to decrease. In addition, significant progress has been made in renegotiating debts with Cuba’s principal creditors.
Considering the above, the new official exchange rate between the CUC and the USD has been fixed at 1 x 1, effective today March 14, 2011, throughout the Cuban territory. This is valid for both exchange operations made within the business sector as well as those made at currency exchange houses (CADECA).
Commercial fees applied on exchange transactions will remain unaltered to cover the costs of the financial institutions offering these services.
The 10 percent penalty on cash purchases of convertible pesos with US dollars stays in place to compensate for the financial costs and risks to the nation’s economy as a result of the irrational and unjust US economic, financial and commercial blockade of Cuba, in place for more than half a century by the US government.
The exchange rate for CUC-Cuban peso at the CADECA exchange houses remains the same: CADECA will purchase 1 CUC at a cost of 24 Cuban pesos, and sell 1 CUC at a cost of 25 Cuban pesos. The measure does not affect official Cuban peso-CUC exchange rates applied on transactions made within the business sector, which stipulate that 1 Cuban peso is equivalent to 1 CUC.
Ernesto Medina Villaveirán
Minister-President
Central Bank of Cuba
