The Miami Herald
January 11, 2001

 Cuba creeping toward economic

 Growth beats the Latin American average, but most Cubans' lives remain hard.

 Associated Press

 HAVANA -- Container ships laden with food and consumer goods from Europe
 and Asia plow daily into Havana Bay, a body of water virtually empty five years
 ago. The daily arrivals in the harbor are a sign that, bit by bit, Cuba's economy
 continues to recover, even though life remains hard for the average Cuban.

 The economy grew 5.6 percent last year and is projected to grow another 5
 percent in 2001, Economics Minister Jose Luis Rodriguez reported in late
 December. Both rates were well ahead of the Latin American average of 3

 But Rodriguez acknowledged that the effects of economic growth have yet to
 trickle down to ordinary Cubans.

 ``Important limitations are still faced when it comes to people's daily lives,''
 Rodriguez acknowledged in his annual report to the National Assembly, or

 The collapse of the Soviet Union a decade ago led the island's gross national
 product to shrink by some 40 percent, and a full recovery to the GNP level of 1989
 may still be years off.

 Prices for non-rationed food remain extremely high for most Cubans, said
 Rodriguez, and more homes need to be repaired and built, and public
 transportation must be improved.

 ``There are a lot more things to buy now, but our pensions are the same,'' said
 Lifa Isabel Barroso, a retiree in her 60s who sells crocheted shawls and doilies to
 tourists in Old Havana. Her monthly pension is 80 pesos, the equivalent of a little
 more than $4.


 Still, things are much better than the early 1990s -- grim years marked by severe
 shortages of food, petroleum and just about everything else. Cubans went months
 without eating meat, blackouts were regularly scheduled to save fuel, and the
 streets were devoid of motor vehicles because there just wasn't any gasoline

 ``Life can still be difficult for all Cubans,'' especially elderly people who need
 special foods and medicines, said Augustin Cruz, 42, who sells wooden statues
 at an artisan market. ``But overall, the economic situation is about 80 percent
 better than 1993,'' the year that's generally considered the roughest for those who

 Much of Cuba's current economic growth has been attributed to tourism, which
 Rodriguez described as ``the most dynamic factor in our economy.'' The industry
 has grown at an average of nearly 19 percent a year over the past five years.


 But the industry failed to live up to expectations in 2000, when 1.8 million people
 visited the island. It was only a 10 percent increase over 1999, well below official
 growth forecasts.

 Foreign investment, meanwhile, ``continues growing and playing a complementary
 role in our development,'' Rodriguez said.


 Since foreign companies first got the green light to invest on the island in 1995,
 370 ``mixed enterprises'' -- partnerships between outside investors and the Cuban
 government -- have been formed. By year's end, that translated into foreign
 investment of $4.3 billion.

 The sugar crop, once all-important, has suffered under chronic drought. Officials
 expect only 3.7 million metric tons from this harvest, a 10 percent drop from a
 year ago.

 Such news would once have been devastating, but the Soviet collapse taught
 Cuban authorities the dangers of not diversifying. Economic planners responded
 by developing tourism, fish exporting and mining industries.

 The average monthly government salary over the past year increased 7.3 percent
 to 249 pesos, which works out to a bit less than $12 at government exchange


 The salary figure can mislead because most Cubans pay little or nothing for
 housing and utilities and enjoy free education and healthcare and heavily
 subsidized public transportation. They also receive about half of their food through
 a government ration program for about 25 pesos a month -- the equivalent of about