Cuba's two currencies explained

80% of Cuba's population is paid with money they can't use to buy the things they want. CNN's Patrick Oppmann breaks down Cuba's two currencies.

[raar]

An answer for Unknow N: Cuba is the only country in the world that has an almost completly US embargo. Imagine that China and Saudi Arabia made the same embargo to US at the same time. Big problem!!!, then multiply this effet for 10 and you can imagine how difficult is the day to day for 99 % of cubans. You can say, no problem, Cuba can make trade with all the world, but 9 of 10 commercial cash transactions are made in USD and when Cuba goverment made this transactions with any foreign entreprise using USD is very possible that this cash be freezzed in US banks and subsidiarys (All money pass throught London or US banks anyway) . Then Cuba government dont want to trade in USD for not lost the USD money.  Cuban gov has to trade with foreign traders that take a lot of risks then they put up the price for all bussiness deals and ask for short delay for be payied. Because of this Cuban gov need quiclky cash and they have invented on 1985, a second cuban currency with the same value that a USD for quiclky change USD and others foreign currencies in this second cuban currency. This currency was named CUC or peso convertible. Then the raison for putting this currency in cirlulation is for quiclky pick up of foreign currencies AND for reduce the exchange rate of USD for cuban pesos, that before USSR failded was 1 USD for 3 cuban pesos and afeter USSR failed was 1 USD for 120 cuban pesos CUP. At 90, s cuban people really be hungry and with CUC the MACROECONOMY avoid a collapse (High risk foreigns investors trusted better in CUC than CUP and with this first currency the recover quickly the money invested in turisms, mines, tobacco and food transformation industries for inside and outbroad CUC market. In 90, s cuban people work for two USD for month, now they are working for 20 USD (with medical and education services paied for cuban gov the Purchasing Power Parity for cubans is 100 USD). But in real life they receive in sallary wages 20 USD per month. maybe 30% of population receive 30 USD average comming from family relatives living abroad.

Two currency is crazy for regular market trasaction for common people and for business peoples too. This two currencies systems hide high bussiness corruption, low productivity, and is not sustainable for more time. Cuban gov. want to put only cuban pesos CUP as only cuban currency, but this is a very difficult process cause, cuban gov need a real strong market oriented system with all equiped wholesalers for keep market up working well. Only US wholesalers can doing this, cause Chinesse and europeans ones dont want risk money in Cuba. Then if two cuban currency systems will finish without US wholesalers in place and without US turism ban lifted the inflation can appears and no chance for nobody the american investors or the Cuban sociaty. Maybe  US wholesalers will be in place for selling items to cuban private sector (cuentapropistas and cooperatives). Prior turism bank ban must be lifted, second US banks should be permitted and third US wholesalers sellsitems to cuban private sector.

Sorry for long staments. English is not my first languages.

[boong]

They need a better reporter/narrator! So hard to understand his story!

[ILsupereroe]

Remove "explained" from the title

[pahil]

Btw… this two currency system is no longer in place…so don’t worry, go to Cuba, it’s absolutely amazing!!

[lazarafarinas]

By the way no one calls it the cup they just don't

[HHH-soro]

I am a tourist, can I deal and buy with (cup)non-convertible pesos in Cuba?

[OreoandChili]

Switzerland has a successful dual currency system. The WIR has the internal legal tender, and the Swiss Franc, certainly a model to be replicated. This is not new, the egypcians had a similar dual system that afforded them with abundance and prosperity for millenia..

[sajjadfaraji]

Hlw guys
Minimum salary in cuba how much??
From Bangladesh