Cuba opens foreign currency-only shops, ends tax on US dollar

HAVANA (AP) – Cuba opened shops on Monday that accept only foreign currencies and eliminated a special tax on the US dollar, deepening a process of collecting stronger currencies to face the country’s economic crisis.

By morning, long queues had formed in a half-dozen such shops in Havana dedicated to the sale of food and toiletries.

Under the new system, people buy merchandise using national or foreign cards backed by hard currencies, especially dollars, including Visa or Mastercards. Cash is not accepted.

The shelves of a large foreign-currency warehouse store visited by Associated Press journalists contained products currently missing from peso-sale stores, including detergent, minced chicken, beef and canned goods.

“It looks to me like at this critical time, when the country is going without food, there is everything” in the market, said Lenon Fernández, a 32-year-old entrepreneur who went shopping at a supermarket known as 70.

The shortages have worsened since the middle of last year when the Trump administration tightened sanctions to pressure for a change in the island’s political model.

Now, on top of sanctions, a cut in remittances from abroad and internal inefficiencies, Cuba is losing tourist revenues because of the coronavirus pandemic and its gross domestic product (GDP) growth is close to zero per cent.

People wearing protective face masks amid the spread of the new coronavirus enter a grocery store that accepts US dollars in Havana. PHOTO: AP