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Fast-growing Cuban cooperative says government ordered it to close
August 5, 2017 / 5:04 AM / 3 months ago

Fast-growing Cuban cooperative says government ordered it to close

HAVANA (Reuters) - One of Cuba’s fastest-growing cooperatives said on Friday it had been ordered by the government to close, the latest sign that Havana is putting the brakes on its ambitious plans to reform its centrally planned economy.

The Cuban government legalized nonagricultural cooperatives five years ago as part of its strategy for the Communist-run state to pull back slowly from the economy in favor of the private sector and market forces.

Scenius, seen as one of the success stories of Cuba’s reform efforts, provides accounting and business consultancy services mainly to state companies. The cooperative was founded in 2014 by three associates and has since grown to 328, said its president, Luis Dueñas.

Now, its future is in the balance.

“Today, there was a meeting in the finance ministry to communicate to us that they were closing the cooperative,” Dueñas said in interview.

“We have to stop providing services within 30 days.”

Dueñas said the decision came after the finance ministry complained Scenius was providing services outside its official remit. He said he disagreed with that assessment.

The government did not immediately reply to a request for comment on the news, which was first reported by digital magazine El Toque.

Earlier this week, the government said it was suspending issuing new licenses for some of the most popular activities in Cuba’s fledgling private sector until it had implemented new measures to curb wrongdoing such as tax evasion.

That announcement on Tuesday caused dismay among Cubans hoping to open bed-and-breakfasts or restaurants, and others who believe expanding the private sector is vital to boosting the country’s ailing economy.

Scenius President Dueñas said it would appeal the finance ministry’s decision for the sake of the cooperatives’ associates and their families.

“We are 328 so that is 328 families affected,” he said.

Many of Scenius’ workers came from the state sector, where the average monthly wage is $30. At the cooperative, they can make $200 a month.

“We are still in a state of shock,” said Scenius associate Yaisy Laplace. “We did not expect this but we still have hope.”

Cuba had been seen to prefer cooperatives - where each worker has a stake in the business - to private companies in which owners make profits based on the work of their employees.

Some analysts say Communist Party hardliners may fear that if any entity becomes too economically powerful it could threaten the ruling party’s power. The law on cooperatives allows for an unlimited number of members.

Reporting by Sarah Marsh; Editing by Tom Hogue

Our Standards:The Thomson Reuters Trust Principles.
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