2 November 2001
Televised presentation by Dr. Fidel Castro
Ruz, President of the Republic of Cuba, on the present
international situation, the economic and world crisis and
its impact on Cuba. Havana, November 2, 2001
My fellow countrymen:
At the opening of the Social Workers Training School in
Santiago de Cuba on October 24, I said that in the coming
days I would speak about the international economic situation
and how it could affect our country, which was carrying out an
unprecedented social development program as it gradually
recovered from the special period. I do not want to put that
discussion off any longer.
To characterize the current situation, one could say, by way of
a very brief summary, that in the mid-1990s, when
globalization was extending around the planet, the United
States, as the absolute masters of the international financial
institutions and through its immense political, military and
technological strength, achieved the most spectacular
accumulation of wealth and power ever seen in history.
But the world and capitalist society were entering into an
entirely new phase. Only an insignificant part of economic
operations were related to world production and trade. Every
day three trillion dollars were involved in speculative
operations including currencies and stocks. Stock prices on
U.S. exchanges were rising like foam, often with no relation
whatsoever to the actual profits and revenues of companies.
A number of myths were created: there would never be
another crisis; the system could regulate itself, because it
had created the mechanisms needed to advance and grow
unimpeded. The creation of purely imaginary wealth reached
such an extent that there were cases of stocks whose value
increased 800 times in a period of only eight years, with an
initial investment of 1000 dollars. It was like an enormous
balloon that could inflate to infinity.
As this virtual wealth was created it was invested, spent and
wasted. Historical experience was completely ignored. The
world’s population had quadrupled in only 100 years. There
were billions of human beings who neither participated in nor
enjoyed this wealth in any way whatsoever. They supplied
raw materials and cheap labor, but did not consume and could
not be consumers. They did not constitute a market, nor the
almost infinite sea fed by the immense river of products that
flowed, in the midst of fierce competition, from factories that
were ever more productive and created ever fewer jobs, based
in a privileged and highly limited group of industrialized
countries.
An elementary analysis was sufficient to comprehend that this
situation was unsustainable.
Nobody seemed to realize that any apparently insignificant
occurrence in the economy of one region of the world could
shake the entire structure of the world economy.
The architects, specialists and administrators of the new
international economic order, economists and politicians, look
on as their fantasy falls to pieces, yet they barely understand
that they have lost control of events. Other forces are in
control now. On the one hand, those of the large and
increasingly powerful and independent transnationals and, on
the other, the stubborn realities are waiting for the world to
truly change.
In July of 1997, the first major crisis of the globalized
neoliberal world erupts. The tigers fall to pieces. Japan has
still not managed to recover, and the world continues to
suffer the consequences.
In August of 1998 comes the so-called Russian crisis. Despite
this country’s insignificant contribution to the worldwide gross
domestic product, barely 2%, the stock markets of the United
States were badly shaken, dropping by hundreds of points in a
matter of hours.
In January of 1999, only five months later, the Brazilian crisis
breaks out.
An all-out joint effort by the G-7, IMF and World Bank was
needed to prevent the crisis from spreading throughout South
America and dealing a devastating blow to the U. S. stock
markets.
This time, the inevitable has happened: the crisis began in
the United States, almost imperceptibly at first. Beginning in
mid-2000, the first symptoms began to be observed, with a
sustained decrease in the rate of industrial production.
In March of that year, the so-called high-tech NASDAQ index
had already begun to drop.
At the same time, the trade deficit showed an enormous
growth, from 264.9 billion dollars in 1999 to 368.4 billion in
2000.
In the second quarter of the year 2000, the gross domestic
product registered growth of 5.7%; in the third quarter, it
grew by only 1.3%.
Industrial sector production began to fall in October of 2000.
Nevertheless, at the end of the year 2000, opinions on the
prospects and forecasts for the world economy were still
rather optimistic. But reality soon reared its ugly head.
Since the beginning of 2001, the IMF, the World Bank, the
Organization for Economic Cooperation and Development
(OECD) and the European Commission, along with private
institutions, have been obliged to downwardly adjust their
growth predictions in the various regions of the world for
2001.
In May, the IMF forecast 3.2% worldwide growth in 2001. For
the United States in particular, projected growth was 1.5%,
and 2.4% for the eurozone. Japan was facing its fourth
recession in 10 years, leading to a prediction of 0.5%
negative growth for the same year.
IMF Managing Director Horst Kohler, during a speech to the
United Nations Economic and Social Council (ECOSOC) in
Geneva, on July 16, 2001, stated, "Growth is slowing
throughout the world. This may be uncomfortable for the
advanced economies (the developed and wealthy countries),
but it will be a further source of hardship for many emerging
markets and developing countries (the poor and
underdeveloped countries), and a real setback in the fight
against world poverty."
Production has dropped in the majority of the Southeast Asian
countries, with the exception of China, and in Latin America,
too. According to the World Bank, growth in Southeast Asia,
which had begun to recover after its dramatic fall in 1997,
would decline from 7.6% in 2000 to 4.5% this year, while
Latin America’s growth would be around 2%, one half of the
growth registered in 2000.
Other institutions also made predictions. The Economist
magazine estimated in April that world growth in 2001 would
be only 2.7%, in contrast to the 4.6% growth registered in
the year 2000, while world trade would grow by 3.5%,
compared to the 13.4% growth in 2000.
With regard to the eurozone, the OECD, in is quarterly report
issued in early May of 2001, estimated that the European
Union would experience growth of 2.6%, a figure 0.5% lower
than its initial projection.
On September 10, just one day before the events in New York
and Washington, the IMF analyzed the evolution of growth
predictions for the world economy and for the economies of
the United States, Europe and Japan. Its findings were as
follows:
World Economy - percentage of growth:
Autumn 2000 4.2
March 2001 3.4
Spring 2001 3.2
September 2001 2.7
A progressive fall from 4.2 to 2.7 in less than a year.
The United States:
Autumn 2000 3.2
March 2001 1.7
Spring 2001 1.5
September 2001 1.5
More of the same, from 3.2 to 1.5 over the same time period.
Japan:
Autumn 2000 1.8
March 2001 1.0
Spring 2001 0.6
September 2001 0.2
The numbers speak for themselves.
The Eurozone:
Autumn 2000 3.4
March 2001 2.7
Spring 2001 2.4
September 2001 1.9
Without exception, the three major centers of the world
economy saw their growth rates fall simultaneously, dropping
to less than half of initial figures over the course of less than
a year. In the case of Japan in particular, growth dropped to
almost zero.
The employment situation:
At the end of the year 2000, the unemployment rate in the
United States was only 3.9%. What happened in the year
2001?
Unemployment rate (percentage):
February 4.2
March 4.3
April 4.5
May 4.4
June 4.5
July 4.5
August 4.9
Although official statistics are not yet available, it is
estimated that unemployment has now reached 5.1%, a rate
that had not been registered in the United States for many
years.
Today, November 2, after this material had been drafted, the
official figure was released: it is 5.4%. In just one month,
415 thousand jobs were lost.
The increase of the unemployment rate is irrefutable evidence
of the deterioration that the U.S. economy had been suffering
prior to the terrorist attacks.
It should be kept in mind, as an important precedent, that
over the last 50 years, when the unemployment rate has
reached 5.1%, this has coincided with the beginning of a
recession.
Percentage of industrial capacity used in the United States
in the year 2001:
February 79.2
March 78.7
April 78.4
May 78.0
June 77.1
July 77.0
August 76.4
In August, industrial production fell by 0.6% as compared to
July. Over the previous 12 months, industrial production had
shrunk by around 5%. August was the 11th consecutive month
of economic contraction.
The figure registered in August is very close to the lowest
level reached since 1983.
Also registered in the month of August of 2001 was a budget
deficit of 80 billion dollars.
That same month, Democratic members of Congress were
already pointing that predictions indicated that the
government would have to use social security money to
finance current expenditures.
During the second quarter of 2001, U.S. imports shrank by
13.9 billion dollars, while the low level of trade activity in the
rest of the world led to a 9.1 billion-dollar reduction in
exports.
Stock values on the main indexes have suffered the following
decreases in 2001:
Dow Jones 18.06%
NASDAQ 66.42%
Standard and Poor’s (S&P) 28.48%
This means the loss of trillions of dollars in less than a year.
The Federal Reserve has lowered interest rates nine times in
2001. The goal in doing so is to lower the cost of money,
boost consumer confidence and thus promote economic
activity. This frantic frequency clearly reflects desperation.
Europe:
Industrial production in the European region experienced a
sustained decline in the first quarter of the year 2001 that
obliged companies to reduce staff, and this, in turn, reduced
consumption, thus creating a vicious downward circle.
Investment and consumption are depressed, aggravating the
trend towards recession.
The European Commissioner for Monetary Affairs has stated
that the European economy will grow by only 1.5% this year.
Meanwhile, the six most prestigious economic research
institutes in Germany have predicted that their country’s
economy will grow by 0.7% this year and 1.3% next year, and
announced that the German economy is on the verge of a
recession. This will have a strong negative impact on the rest
of Europe, given that Germany is considered the region’s
"economic motor."
Japan:
Japan’s real gross domestic product in the first quarter of the
year 2001 dropped more dramatically than expected, with a
decrease of 0.2% as compared to predictions of 0.1%,
followed by an additional 0.8% drop in the second quarter.
The decrease in industrial production that began in March
reached 11.7% by August. This phenomenon of six
consecutive months of decline in industrial production has not
been witnessed in the Japanese economy since the period
from December of 1991 to May of 1992, and it places
industrial production at the lowest level of the last seven
years. This means an even worse crisis than the financial
crisis of 1997-1998, according to Japanese analysts.
Japan’s trade surplus decreased 48% in July of this year.
As a defensive measure, companies are cutting staff, leading
to a rise in the unemployment rate, which reached an all-time
high of 5% in August of this year, something never before
seen in Japan.
Latin America
In August, the Economic Commission for Latin America and
the Caribbean (ECLAC) reported that the region’s economy
would grow by only 2% in 2001, a mere half of the growth
registered the previous year (4%). In so doing, it retracted its
prior prediction, made in May, forecasting a GDP growth of
between 2.7% and 3%.
According to ECLAC, this is the result of the worldwide
economic weakening and instability in a number of the
region’s key countries: Peru and Uruguay will experience no
growth; Brazil has been affected by a scarcity of fuel supplies,
which has hit its productive activity, and by an almost 40%
devaluation of its currency this year; and Chile’s economic
reactivation has come to a halt. In the case of Mexico, a
feeble economic growth of 0.13% is predicted for this year,
and 1.74% for 2002. The government had originally forecast
4.5% growth in the gross domestic product for 2001, but it
has downscaled that figure a number of times due to the
slowdown in the world economy, and particularly that of the
United States.
ECLAC estimates that unemployment in the region will reach
at least 8.5%.
There are people who calmly speak today about the "world
economic crisis caused by the terrorist attacks that took place
in the United States on September 11 and by the war against
Afghanistan initiated on October 7." Such statements are
completely baseless. What I have just outlined irrefutably
proves this. The crisis was already breaking out,
uncontrollably.
Every week I receive a bulletin with the most important
economic news gathered from the most prestigious and
reliable public sources of information, or statements made by
specialists and political leaders. I remember in particular the
bulletin I received on September 8, 2001, exactly three days
before the terrible tragedy in New York. It had been many
years since I had read so much bad news about the prospects
for the international economy in just one bulletin.
Curiosity led me to look it over once again. I have chosen a
number of reports from it, which read as follows:
"Hitachi Ltd., Japan’s biggest manufacturer of electronic
products, announced that it will cut 14,700 jobs this year, or
4% of its staff, while preparing for a loss of over a billion
dollars caused by the collapse of the high-tech sector."
"Rival Japanese conglomerates Toshiba Corp., NEC Corp. and
Fujitsu Ltd. have also announced that they plan to cut
thousands of jobs." (CNN, 31/08/2001)
"The president of the United States Federal Reserve said that
the rise in housing prices, at the same time that the stock
market has collapsed, is making it difficult for the central
bank to diagnose the state of the country’s economy. This
divergence ‘could have significant implications’ for the
country’s economic growth, he declared. (The Wall Street
Journal, 31/08/2001)
"The U.S. Federal Reserve has warned in its latest report to
the country’s banking institutions that they have not
reinforced their risk management systems to the extent
demanded by the economic slowdown facing the international
economy." (Spanish newspaper Cinco Días, 31/08/2001)
"The European Commission admitted yesterday that the
prediction for economic growth in the eurozone this year will
be less than 2.5%. The monetary affairs commissioner, Pedro
Solbes, who even noted that Brussels has "some doubts"
about this figure, acknowledged this. The drop in rates by a
quarter of a point, announced last week by the president of
the European Central Bank (ECB), was accompanied by an
explicit acknowledgement of an error in calculation. ‘What we
have underestimated is how long and severe the slowdown
has turned out to be in the United States,’ Duisenberg said.
‘If I may say so, we, and also the United States authorities,
have tended to be too optimistic regarding the duration and
depth of the slowdown,’ he said, recalling the opinions of
Treasury Secretary Paul O’Neill.
"The ECB’s orientation difficulties are contained in this brief
analysis, which comes a bit late after the gradual reduction
from the 3.2% growth in the eurozone predicted in January to
the 2% estimated in recent days." (Spanish newspaper
Cinco Días, 31/08/2001)
"The president of the United States acknowledged his concern
over the persistent decline in U.S. economic activity and its
repercussions on the labor market. I am aware of the
problems being faced today by the families of workers
affected by the economic crisis, but I am convinced that the
economy will get back on its feet, he declared before a
meeting of trade union groups.
"With the economy on the brink of a recession, the president
tried to convince U.S. workers that he was aware of their
situation and that he is doing something to remedy it. The
matter is complicated, given that the weakening of consumer
confidence, the decline in financial markets and the lukewarm
growth of the major world power have placed economic affairs
at the top of the president’s agenda." (Spanish newspaper
Expansión, 04/09/2001)
Note that President Bush, who is not very partial to these
subjects, made these declarations one week before
September 11.
"Growth is practically arrested in Latin America, according to
first-quarter figures on the gross domestic product.
"The balance for 2001 will show a new drop in per capita
gross domestic product in the region, asserted the Banco
Bilbao Vizcaya Argentaria in its latest report on Latin America.
The bank has lowered its prediction of growth in this group of
countries from an initial 3.9% down to 1%, a rate that fails to
match population growth.
"The reasons for this more pessimistic view are to be found in
a world economic slowdown greater than estimated at the
beginning of the year."
"The feeble growth of the main economies has translated into
a heavy reduction in external demand and, as a result, in
Latin American exports as well.
"The Mexican economy has been the hardest hit by the
consequences, given its high degree of dependence on
industrial activity in the United States. Its growth this year
will be limited to 0.2%, according to the bank, as compared
with the 6.9% growth registered in 2000." (Spanish
newspaper Cinco Días, 04/09/2001)
"The number of layoffs announced in the United States has
already surpassed one million so far this year, despite the
fact that the pace of cutbacks was curbed in August. In all,
U.S. companies announced plans to eliminate 140,0199 jobs
that month, which was 32% less than the total for July, but
over double the cuts registered in August of 2000. As a result,
the sum total for the first eight months of the year reached
1,120,000 jobs eliminated, a number 83% greater that the
total cuts in the year 2000. The telecommunications sector
continues to be the hardest hit, with 19% of jobs in the
sector eliminated so far this year." (Spanish newspaper
Cinco Días, 05/09/2001)
"The serious budgetary difficulties in Germany and Italy and
less severe difficulties in Spain are joined by those of France,
whose cash deficit rose by 16% in the first five months of the
year." (Spanish newspaper Expansión, 05/09/2001)
"German Minister of the Economy Werner Müller admitted that
growth in the gross domestic product of the German giant will
not reach 1.5% this year. Up until now he had only admitted
that growth would be ‘under 2%’. Müller’s declarations will act
as a further bucket of cold water for those who had predicted
a swift recovery for the German economy." (Spanish
newspaper Cinco Días, 05/09/2001)
"While U.S. industry was beginning to give off positive signs
of recovery, it is now the service sector that is responsible for
throwing a new bucket of cold water on expectations. Activity
in the service sector declined once again in August, according
to figures from the National Association of Purchasing
Managers. The monthly index of activity dropped from 48.9
points in July to 45.5 points in August, which represents the
second consecutive month below the 50-point level,
considered the dividing line between recession and growth. In
August there was a sharp drop in new orders, indicating a
serious decline in activity for the coming months. The figure
far exceeded the predictions of analysts who expected a
minimum reduction to 48 points at most." (Spanish
newspaper Cinco Días, 06/09/2001)
"According to figures from the International Monetary Fund,
between 500 billion and a trillion and a half dollars a year –
between 1.5% and 4.5% of worldwide gross domestic product
– generated by illegal activities are laundered through the
banking system." (Spanish newspaper El País,
06/09/2001)
"The Central Bank of the United Kingdom recently cut its
prediction for gross domestic product growth in 2001 to 2%,
the lowest level since the recession in the early 90s."
(Spanish newspaper Cinco Días, 06/09/2001)
"Moody’s, a rating agency specializing in risk assessment and
considered a world leader in this area, warned yesterday of
the possibility of lowering the rating of Japanese sovereign
bonds."
"Today the gross domestic product figure for the second
quarter of the year will be announced, and analysts’
predictions point to a drop of between 0.9% and 1%. If this is
the case, the economy would technically enter a recession
after a 0.2% fall in gross domestic product between January
and March. The figure raises questions about the future of the
world’s second economy in the context of a slowdown
heightened by the weakness of the United States." (Spanish
newspaper Cinco Días, 07/09/2001)
As can be seen, the economic crisis is not a consequence of
the September 11 attacks and the war against Afghanistan.
Such claims could only be made out of total ignorance or an
attempt to hide the real cause. The crisis is a consequence of
the resounding and irreversible failure of an economic and
political conception imposed on the world: neoliberalism and
neoliberal globalization.
The terrorist attacks and the war did not give rise to the
crisis, but they have considerably aggravated it. What had
already been rapidly advancing was abruptly and untimely
boosted even further. Humanity must now confront three
extremely serious problems, which feed off of one another:
terrorism, the war and the economic crisis.
The economic crisis also means the aggravation of major
problems that are far from being solved: poverty, hunger and
disease, which kill tens of millions of people in the world
every year; illiteracy, lack of education, unemployment, and
the exploitation of millions of children through child labor and
prostitution; the trafficking and consumption of drugs, which
mobilizes and absorbs hundreds of billions of dollars; money
laundering; the lack of drinking water; the scarcity of housing,
hospitals, communications, schools and educational facilities.
The crucial rights of all human beings are affected.
The crisis will have an especially negative impact on the
struggle for sustainable development, the preservation of the
environment and the protection of nature from the merciless
destruction to which it is being subjected, and which is
causing the poisoning of the waters and the atmosphere, the
destruction of the ozone layer, deforestation, desertification,
and the extinction of animals and plants. How could this
possibly not be taken into the slightest account?
There are nations and even entire regions on some continents
that could be annihilated if terrifying plagues like AIDS are
not urgently combated and defeated by humankind; and if
terrorism, war and the economic crisis are not resolutely
confronted. Now is the time when cooperation among all
countries is needed more than ever before.
Although it is essential to return to this theme before I finish
my presentation, I would first like to explain how the current
international situation and the economic crisis are influencing
and will undoubtedly continue to influence our own country.
The economic crisis had already been affecting some of our
main sources of convertible currency.
The most direct immediate consequences: the price of sugar
on the world market has fallen from 9 to 6.53 cents a pound;
the price of nickel, another export line in which production had
increased alongside a reduction in costs and fuel
expenditures, dropped from 8.64 dollars to 4.715 dollars a
ton; sales of tobacco, another of our most important export
products, are declining in all markets. The crisis has also
limited other exports of goods and services that were being
developed.
Direct consequences of the terrorist attacks and the war
unleashed
Despite the world economic crisis that was developing and
the rise in airfares resulting from increased fuel costs, we had
received a total of 1,304, 597 tourists as of August 31 this
year. This represented growth of 7.8% in comparison with the
same period last year, when 1,200,076 tourists were received.
The number of visitors staying in tourism industry facilities
grew by 11.3%.
In September, the total number of visitors decreased, in only
20 days, by 9.9% in comparison with the same month last
year. It is estimated that the decrease for the month of
October will reach 14%. Varadero and the city of Havana, the
country’s two most important tourist destinations, are also
the most affected.
The goal of receiving a total of two million tourists was
feasible, and the first million was reached three weeks earlier
than last year, during the first quarter. Now the growth
achieved will likely be only 3% to 6%.
The blow dealt to the Caribbean after September 11 was even
more severe. They depended more on tourism from the United
States.
There have been other negative effects resulting from the
causes mentioned above and from other causes aside from
terrorism and the war:
The possibility of obtaining credits has been reduced due to
the reduction in our convertible currency income.
We have financial obligations that must be met despite the
reduction in convertible currency income.
Foreign exchange bureaus
Cuba’s foreign exchange bureaus (known by the acronym
CADECA) felt an immediate effect as soon as the bombing
started. To allow for a fuller understanding, I need to explain
that during the most difficult moments of the special period,
the depreciation of our currency, the Cuban peso, led the
exchange rate to 150 pesos to the dollar. The measures
adopted and the creation of the CADECAs improved the rate
to 20 pesos to the dollar. This brought major benefits to the
population: their money rose in value, and all the people were
given access to stores operating in convertible currency.
Over the course of more than five years, our country achieved
an unprecedented feat, unique in the world: despite the
blockade and the economic war, it managed to maintain a
stable exchange rate for its currency, with minor fluctuations
in one direction or the other. The bank always obtained a
small difference in its favor, because the CADECAs met with a
greater supply of dollars for pesos than the supply of pesos
for our convertible pesos [equivalent in value to U.S. dollars
within Cuba]. The difference obtained was devoted entirely to
acquiring raw materials sold in convertible currency in order to
manufacture products for sale to the population in Cuban
pesos, from French bread to brand-name beer, along with
many other products. The national currency funds thus
recovered served in turn to maintain the stability of the
peso-dollar exchange rate.
Then the situation was reversed: the supply of dollars
decreased and the demand for convertible pesos increased.
For 20 consecutive days, with the exception of three, the bank
supplied more dollars than it received. The adverse balance
reached almost four million dollars.
The CADECAs operate on the principle of supply and demand;
it can be no other way. As a result, the peso began to decline
in value. At one point, the exchange rate reached 28 pesos to
the convertible peso in a number of provinces. Three days ago
it stabilized at 26 pesos to the convertible peso; convertible
pesos are equivalent in value to U.S. dollars and can be
immediately changed into U.S. dollars upon request.
The peso, in these circumstances, lost 18.18% of its value.
This is a situation that must be monitored closely. At the
moment, the country should not take any risks with its
convertible currency resources. It is our duty to inform our
people, so that they may adopt the decisions they deem most
advisable under any given circumstances. At times when the
situation calls for the devaluation of the peso, they should
not let themselves be influenced by the advice of speculators
or by fear.
It should not be forgotten that the Revolution, in such
difficult conditions as those prevailing in 1994, succeeded in
bringing about the decrease in the exchange rate from 150
pesos to the dollar to 20 to the dollar, and it kept this rate
relatively stable for many years. The population has the
possibility of making term deposits in pesos, which pay an
interest rate of 7.5% annually, triple the interest paid on
accounts in dollars, and 50% more than the interest paid on
convertible pesos.
In the end, the Revolution will win this battle against the
consequences of the international economic crisis as well, no
matter how serious that crisis becomes, and its currency will
eventually increase in value once again.
The Revolution, with all its moral authority, guarantees all
citizens:
That the CADECAs will not be
closed
That all bank deposits, whether
in regular Cuban pesos,
convertible pesos or dollars, will
be absolutely respected.
That the stores that sell goods
in convertible currency, and to
which everyone has access, to a
greater or lesser extent, in
accordance with their income in
one currency or the other, will
not be closed.
That the farmers markets will
remain open.
That the value of the Cuban peso
will be resolutely defended. The
prices of goods and services
currently offered to the
population at official prices,
whether rationed or not, will not
go up by a single cent. In
accordance with this policy, the
only prices that may vary are
those in the farmers markets, for
obvious reasons, since they
operate on the basis of supply
and demand, and those in the
state-run farmers markets, which
should use the regular farmers
markets as a point of reference,
but maintain lower prices,
depending on the resources
available to us. The prices in
convertible currency stores may
vary as well, as they always
have.
The prices of the 700,000
Chinese television sets that will
be distributed and sold to the
population in national currency
will be calculated at the
exchange rate of 20 pesos to the
dollar, as was previously
established. They will be paid for
in the installments agreed upon,
with no interest charges
whatsoever.
We have not lived through ten years of the special period in
vain.
Today, of course, the main concern of our people and the
planet as a whole is the preservation of peace, because
without peace, the world would be headed towards a fatal
abyss. And we will struggle for peace with the same courage,
honor and dignity as we always have.
We will confront the economic crisis successfully. No sacrifice
intimidates us, not even the sacrifice of our lives. This is very
well known. We have endured all manners of sacrifices for
many years. Those who thought the Revolution would only
last a matter of weeks now admire our heroic capacity to
resist and move forward.
Many pages could be filled with accounts of the feats we have
achieved. We need only mention a few:
Before the special period, out of every
peso invested, 80 cents were exploited,
and that figure fell to 50 cents in 1994;
today it stands at 91 cents. In 1994, it
took approximately 12 days to build one
hotel room; in 2000, the time was reduced
to 2.2 days.
The budget deficit has been maintained at
less than 3% of the gross domestic
product over the last five years, after
reaching 33.5% in 1993.
Labor productivity has increased by 19%.
Almost 75% of the growth in the economy
has resulted from this factor.
The tourism sector has experienced an
eight-fold increase in income and a
fivefold increase in the number of tourists.
This has been achieved by merely tripling
the number of hotel rooms and doubling
the number of workers.
Oil production, which totaled 500,000 tons
at the beginning of the special period, has
now risen to the equivalent of 3.6 million
tons, between oil and natural gas. We will
not hesitate to invest in this area. Next
year we will surpass the figure of four
million tons. For each ton of Cuban oil and
natural gas used in electrical power
production and other industries, the
country saves 60% of the price in
convertible currency.
Production levels today are the same or
much higher in comparison with 1989 in
sectors like tourism, manufacturing for the
domestic convertible-currency market,
electrical power generation, nickel,
vegetable crops, citrus fruits,
pharmaceuticals, cigars for export, and
others. The same holds true for results in
education, health care, culture, sports and
science.
The daily per capita calorie intake rose
from 1948 calories in 1994 to 2578 last
year, while the protein intake went from
47.7 grams to 68.3 grams in the same
period.
The average monthly salary, which was
185 pesos in 1994, should reach 242 pesos
by the end of the year, while the average
income, which includes monetary
incentives and other forms of payment in
kind, will reach 373 pesos.
In the state-funded public sector, 82% of
workers, or 1,091,200 workers in all, have
received raises in their salaries.
In the self-financing enterprise sector,
73.3% of workers, or 1,322,000 workers,
are paid according to performance.
Over 1.2 million workers are eligible for
performance-based incentives in
convertible Cuban pesos or their
equivalent.
The farmers markets, from their
emergence in 1994, reduced their prices by
84%. The state-run farmers markets,
which now extend throughout the country,
and charge lower average prices than the
regular farmers markets, have served to
curb price increases in the latter.
Unemployment, which rose to 8% in the
worst years of the special period, was
reduced to 5.4% in 2000. The differences
among regions in this regard are a focus of
special attention.
In 1994 there were power cuts on 344
days, almost every day of the year, and
1.2 million MW of energy were not
provided due to a power deficit; last year,
there were power cuts on only 77 days,
with 64,000 MW not provided.
Residential power consumption grew by
16% in the last few years. That growth
could have been 25% if the energy-saving
program had not been implemented.
There is greater protection of the
environment today, with a decrease in all
types of pollution (of the soil, water and
air). Economic growth has not been
achieved at the cost of destroying the
environment, but instead has contributed
to improving it, in line with sustainable
development.
The percentage of the population with
access to drinking water rose from 82% to
94%, with over 1.2 million people
benefiting from the construction of water
supply systems in 2454 rural communities.
Almost all of the country’s water is
chlorinated.
A natural gas program is underway, and
since the end of 1998, it has benefited
over a million people in 268,209
households, who can now cook with
bottled gas instead of kerosene.
The telephone expansion program that
began in 1999 has provided 146,750 new
telephone lines so far.
All public telephones have been changed
to digital phones. In 1999, there were
11,860 public telephones, and that number
had risen to 18,000 by the end of the year
2000. A further 4700 will be installed this
year.
Some 320,000 new homes have been built
in the last five years, benefiting over 1.2
million people.
Social security and social protection
services have been guaranteed for the
most vulnerable sectors.
During these 10 years of the special
period, over 17 billion pesos have been
paid out in pensions.
There is no need for me to talk about the battle of ideas and
the colossal social project that you all know about, which is
leading us towards a much more fair and improved socialism,
and towards the goal of becoming the most educated and
cultured people in the world. Suffice it to say that it
encompasses 70 programs and hundreds of tasks, with
several of the most important already completed.
Some future dreams will have to wait, but these will be
fulfilled.
The most important investments have already been made,
and were minimal. The fundamental role has been played and
will continue to be played by the immense human capital of
our people.
Today we are politically more united and stronger than ever.
We are much better prepared to confront this situation.
Our social justice will allow us to protect all our people.
There is greater organization in our political and grassroots
institutions, our State and our Government.
Our enterprise sector is improving; we have learned to
produce with fewer resources, greater efficiency and greater
discipline.
We are aware of what has been happening in the world to
those who have renounced socialism and implemented
neoliberal policies.
We have a people who are steadily becoming ever more
cultured, more conscientious, and better prepared in every
sense.
At the beginning of the special period, our socialist ideology
had suffered a terrible blow. Today, the terrible blow has
been dealt to the ideology of our adversary, through a
profound economic and ideological crisis.
I noted earlier that before concluding, I would return to the
issue of terrorism, the war and the international economic
crisis.
Although we have made our stance known, I think it would be
worthwhile to recall that on September 11, just hours after
the events, and having expressed our total condemnation of
the brutal attack and our sincere and selfless solidarity with
the people of the United States – since we never asked for
nor expected anything in return – we expressed a conviction
that we continue to hold today, with more strength and
certainty than ever: "None of the present problems of the
world can be solved by force. [...] The international
community should build a world conscience against terrorism.
[...] Only the intelligent policy of seeking strength through
consensus and the international public opinion can decidedly
uproot this problem [...] this unimaginable event should serve
to launch an international struggle against terrorism. [...] The
world cannot be saved unless a path of international peace
and cooperation is pursued."
A week later, in San Antonio de los Baños, I declared on
behalf of our people, "Whatever happens (that is to say,
whether or not there is a war), the territory of Cuba will never
be used for terrorist actions against the American people."
I added something else: "We will do everything within our
reach to prevent such actions against that people. Today we
are expressing our solidarity while urging to peace and
calmness. One day they will admit we were right."
A week later, on September 29, at the Revolutionary Mass
Rally held in Ciego de Avila, I continued to stress our points
of view: "Nevertheless, no one should be misled into thinking
that the peoples of the world, and a number of honest
political leaders, will not react as soon as the war actions
become a reality and their horrific images start to be seen.
These will then take the place of the sad and shocking
images of the events in New York at a time when forgetting
them would bring irreparable damage on the spirit of
solidarity with the American people that is today a primary
element towards the eradication of terrorism, without the
need to resort to a war of unpredictable consequences and
avoiding the death of an incalculable number of innocents.
"The first victims can already be seen. They are the millions
trying to escape the war and the dying children with ghastly
appearance whose images will move the world to pity without
anyone being able to prevent their dissemination."
The events that have been taking place make it increasingly
clear how right we were.
An editorial in Granma, the official newspaper of our
Communist Party, published on October 8, just hours after the
war had been unleashed, stated: "It is not a war against
terrorism; [...] it is a war in favor of terrorism, since the
military operations will make it more complicated and difficult
to eradicate it. It is like pouring oil on the flame.
"From now on, there will be a real avalanche of news about
bombs, missiles, air strikes, the advance of armored vehicles
with troops of ethnic groups allied with the invaders, the
dropping of paratroops or the ground advance of elite forces
of the attacking countries. Rather soon, there will be news
about occupied cities, the capital included, and TV images of
whatever censure permits or escapes control. The fight will be
against the people of that country and not against the
terrorists. There are no battalions or armies of terrorists. This
is a sinister concept and an insidious method of struggle
against a ghost."
After 26 days of relentless bombing, those who have been
following events from day to day can see that what has
happened up until now is exactly as we predicted.
The war began inexorably. We knew that it was extremely
unlikely, practically impossible, that it would not happen.
Nevertheless, this has not led us, either before or after, to
become discouraged or renounce our stance.
We insisted that it was necessary to fight against terrorism
and against the war. A spirit of revenge or hatred against
America never led us. It was with sadness that I meditated
on the mistake that, in my view, was being made but I never
uttered an insult or a personal offense. I have often said to
those involved in this battle of ideas that there is no need to
personally offend anyone. I rather enumerate facts, avoid
adjectives, and analyze with cool head and wage arguments.
That preserves our moral authority and prevents anyone from
questioning the strength and sincerity of our position.
Presently, I am afraid that if the possibility existed to defeat
terrorism without a war, through cooperation and with the
unanimous support of all the international community leading
to truly efficient measures and to the building of a strong
moral conscience against terrorism, that possibility tends to
fade away with every passing day.
The worst would be to come to a point when it would no
longer be possible to find a solution that way because I see it
ever more clearly that it is absurd and impossible to try to
resolve this through war. I try to imagine what was going
through the minds of the American political and military
strategists; maybe they thought that a colossal deployment
of forces would crush the will of the Taliban; perhaps, they
were hopeful that an initial devastating blow would attain
that objective.
Everybody knows the estimates made by NATO during the war
against Yugoslavia. The idea was that the objectives would
be accomplished in 5 days, but almost 80 days passed and it
had not happened. It is also a known fact that despite the
extraordinary display of technology and means, the Serbian
army was practically intact. The envoys of Russia and Finland
had to weight heavily to "persuade" the adversary through
diplomatic channels when the time had come to fight on the
ground, something that the members of the coalition were not
particularly fond of.
I do not share the view that the United States’ main pursuit
in Afghanistan was oil. I rather see it as part of a
geo-strategic concept. No one would make such a mistake
simply to go after oil, least of all a country with access to any
oil in the world, including all the Russian oil and gas it
wishes. It would be sufficient for the U.S. to invest, to buy
and to pay. Based on its privileges, the United States can
even purchase it by minting reserve bonds on a 30 years
maturity span. That is how, throughout more than 80 years, it
has bought products and services accounting for over 6.6
trillion dollars.
Military actions in Afghanistan are fraught with dangers. That
is an extremely troubled area where two large countries have
fought several wars. There are profound national and religious
antagonisms between them. The population of the disputed
territory is mostly Islamic. As the tempers grow frail, a war
might break out; and both countries have nuclear capability.
That risk is as serious as the destabilization of the Pakistani
government by the war. That government is being placed in a
highly complicated position. The Taliban emerged there, and
they share the same Pashtun ethnia with an undetermined
number of Pakistanis, in fact, no less than 10 million; and I
have chosen the most conservative figure among those that
have been mentioned. They also share with fanatic passion
the same religious beliefs.
The U.S. military are usually well versed in their trade. I have
met some when, after retirement, they have visited Cuba as
scholars. They write books, tell stories and make political
analyses. I was then not surprised by the information
released by The New Yorker magazine of October 29 in the
sense that there was a contingency plan to seize the
Pakistani nuclear warheads, in case a radical group took over
the government of that country.
It was absolutely impossible for the American strategists to
overlook that substantial risk. Every bomb dropped on
Afghanistan, every picture of dead children or people dying or
suffering from terrible wounds, tend to compound that risk.
What is hard to imagine is the reaction of those responsible
for protecting those weapons, to a plan that is by now of
public domain as much as Chronicle of a death foretold by
Gabriel García Marquez.
I am not aware of something the U.S. Special Services should
know only too well, that is, where and how those nuclear
warheads are kept and the way in which they are protected. I
try to imagine –and it is not easy-- how such an action could
be conducted by elite troops. Perhaps, one day someone
might tell how it could be done. But, still, I find it hard to
imagine the political scenario in the aftermath of such an
action when the fight would be against over 100 million
additional Muslims. The U.S. government has denied the
existence of such contingency plan. It was to be expected. It
could not do otherwise.
The most logical question that crosses my mind is whether
the heads of governments and statesmen who are friends of
the United States and have a longstanding political and
practical experience did not see these potential dangers, and
why they did not warn the United States and tried to
persuade it. Obviously, America’s friends fear it but do not
appreciate it.
It is always difficult to try to guess when it comes to these
issues. But, there is something of which I am absolutely
certain: it would be sufficient if 20 or 30 thousand men used
clever methods of irregular warfare, the same that the United
States wants to use there, and that struggle could last 20
years. It is completely impossible to subdue the Afghan
adversary in an irregular warfare on that country’s ground with
bombs and missiles, whatever the caliber and the power of
these weapons.
They have already been through the hardest psychological
moments. They have lost everything: family, housing, and
properties. They have absolutely nothing else they can lose.
Nothing seems to indicate that they will surrender their
weapons, even if their most notable leaders were killed. The
use of tactical weapons, which some have suggested, would
have the effect of multiplying by one hundred that mistake
and with it unbearable criticism and universal isolation.
Therefore, I have never believed that the leaders of that
country have seriously considered such tactics, not even when
they were most enraged.
These are simply my thoughts that I am expressing to you. I
think the way to show solidarity with the American people
that lost thousands of innocent lives, including those of
children, youths and elders, men and women to the
outrageous attack, is by frankly speaking out our minds. The
sacrifice of those lives should not be in vain, but rather it
should be useful to save many lives, to prove that thinking
and conscience can be stronger than terror and death.
We are not suggesting that any crime committed on Earth
should be left unpunished, I simply do not have elements of
judgement to accuse anyone in particular. But, if the culprits
were those that the U.S. government is trying to punish and
remove, there is no doubt that the way in which they are
doing it will lead to the creation of altars where the alleged
murderers will be worshiped as saints by millions of men and
women.
It would be better to build an enormous altar to Peace where
Humankind can pay homage to all the innocent victims of
blind terror and violence, be it an American or an Afghan
child. This is said by somebody who considers himself an
adversary of the United States’ policies but not an enemy of
that country, one who believes to have an idea of human
history, psychology and justice.
Having come to this point there is only one more issue left to
discuss.
What is happening with the anthrax is absolutely
incomprehensible. Real and sincere panic has been created.
The stocks of medications to fight that bacterium are being
depleted. Many people are buying gas masks and other
devices, some of which cost thousands of dollars.
Extravagant behavior can cause more damage than the
disease. When there is an outbreak of any disease, whatever
the cause, it is essential to warn the people and to provide
information on the illness and the measures that should be
taken to prevent it, diagnose it and fight it. Diseases are
carried from one country to another in natural ways, that is,
through people, animals, plants, food, insects, commercial
products and a thousand other ways, without the need for
anyone to produce them in laboratories. That is how it has
been historically. That is the reason for so many public-health
regulations.
The chaos and the psychological reaction to anthrax have
turned the American society into a hostage of those who want
to hurt it, knowing beforehand that they will sow terror. On
numerous occasions our country has had to face up to new
diseases affecting people, plantations and herds, many of
them deliberately introduced. No wonder our country has
graduated 67,128 medical doctors and thousands of
technicians in plant and animal health. Our people know what
should be immediately done in such cases.
No other country in the world compares with the United
States in the number of research centers, laboratories and
medications, or the capacity to produce them or purchase
them, to fight that or any other disease.
In the face of real or imaginary risk, either current or future,
there is no other choice but to educate the people to cope
with them. This is what the Cubans have done.
The causes that gave rise to panic should be analyzed.
Certainly, it could not be said that the United States is not in
risk of terrorist actions. However, I do not believe that under
the present circumstances of generalized alertness, and the
measures taken, any group inside or outside America could
come up with a coordinated action, organized in every detail
for a long time, synchronized and executed with such
precision as that of September 11.
In my view the main risk may lie with individual actions, or
actions carried out by very few people from inside or outside
America that could cause lesser or greater damage. None can
be underestimated. But as important as the preventive
measures that should be taken to tackle such risks, or even
more important, is to psychologically disarm the potential
perpetrators. And these include those who might want to do it
out of political extremism, vengeance or hatred, or a
significant number of people who are frustrated, unstable or
deranged who might feel tempted by the spectacular or by
wishes to be the main actors of well-known events. They
could drive the American people mad by sending mail with or
without anthrax. Everything possible should be done to put an
end to panic, extravaganza and chaos, then danger will be
reduced.
In Cuba we have also seen the arrival and circulation of
letters and postcards with strange powders and other things.
One hundred and sixteen of them were detected from 15 to
31 October. 72 were coming from abroad: 36 from the United
States, 8 from Great Britain, 3 from Canada, 2 from the
Checkia Republic, 2 from Spain, 2 from The Netherlands, 1
from Denmark, 1 from Chile and 1 from the Arab Emirates. Of
these letters 25 were addressed to me. I thank the senders
for their kindness.
Our laboratory staffs are becoming real experts. Thirty-one
originated within the country and circulated here, several were
no more than bad jokes. Five were being sent from Cuba to
other countries: 2 to the United States, 1 to Pakistan, 1 to
Italy and 1 to Costa Rica. In eight cases it has not been
possible to determine where they have come from.
Out of the 116 letters that have been examined, except for 24
that are still under analysis, no biological agent has been
found. Not one worker in our postal services, the offices in
the Palace [of the Revolution] or the laboratories has been
contaminated. We are all in good health. There was no
sensationalism, no scandal, no alarm or panic. No one
purchased gas masks or medications. I am telling you the
story simply to illustrate what I said about how
incomprehensible it is what has happened with the anthrax in
America.
Even if a bacterium had been introduced here, there would be
no panic and everybody would know what to do. But, it would
certainly be very difficult for a letter to go out from Cuba to
another country carrying viruses or bacteria. We are pleased
to know that the two letters addressed to the United States
did not leave our country, neither did the others that were
supposed to get to other countries.
And thus we will cooperate with every people in the world.
Our doctors and other specialists as well as our technicians,
research centers and our modest experience will be available
in the struggle against biological bio-terrorism and other
forms of terror.
It is clear by now that America’s friends fear it but do not
appreciate it. Cuba is not in the least fearful of the enormous
power of that nation, but it can appreciate its people.
Thank you, very much.
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