Samuel Rodiles Planas, head of the Physical Planning Institute, began the session with a presentation on land use and urban zoning plans for the Mariel Special Development Zone and the city of Trinidad, which were approved by the Council of Ministers.

Regarding the first, he said that the plan is a short term one, projecting through 2033 and identifies potentialities of the region such as its proximity to the Cuban capital, the existence of an available water supply, the presence of port infrastructure, airport, and communications, as well as highway and railroad access.

The Plan divides the Special Zone into sectors, dedicated to industry and logistics; tourism; and livestock, forestry and agricultural development. In addition, it projects the creation of conditions in nearby settlements to receive the expanding workforce that is expected and the improvement of those existent.In terms of the General Urban Zoning Plan for the city of Trinidad, with the greatest potential for tourism within the province of Sancti Spíritus, Rodiles said that the design guarantees the orderly, planned development of the city from the functional, structural, and environmental point of view. It is a novel vision of Trinidad, seen in all its splendor from the sea, with new areas designated for future development, while protecting the historic central district, recognized by UNESCO as a World Cultural Heritage Site, he said.Teresita Romero Rodríguez, president of the Sancti Spíritus Provincial Assembly of People’s Power, said she considered the plan a good one, with urban regulations that will allow for harmonious development. In addition, she said, the heritage value ​​of the city and its surroundings is preserved, adhering to established housing policy and measures that have been proposed as part of Tarea Vida, which guides adaptation to climate change. The plan was reconciled with the National Institute of Water Resources, given the municipality’s water supply issues.In this regard, Diaz-Canel said that the two plans should help to ensure that everything we do is coherent and better ordered development is achieved in these areas. Particularly Trinidad, he said, is a beautiful historic city, one of the first villas founded by the Spanish, with a great heritage and an active cultural and productive life.

FOREIGN TRADEAs part of the government’s regular review of the economic effects of irregularities in foreign trade operations, the Council of Ministers also addressed the situation in this arena, as of the end of 2018.Minister of Foreign Trade and Investment Rodrigo Malmierca Díaz explained that actions have been taken to reduce the damage and strengthen monitoring and accounting mechanisms put in place by the Ministry, as the governing body in this activity.He detailed follow-up action taken in such cases – contract breaches and violations of quality parameters, for example.

He specified that, in cases which have been fully analyzed, measures were adopted and sanctions applied, given the economic impact on the country.Among the logistical problems that hinder the efficiency of export and import operations, he identified payments for overstays in ports. Despite a continuing downward trend with respect to 2017, an increase is evident in the case of containers from general cargo ships, as a result of problems in ports, the reception of goods, and storage capacity.

The Minister stated that it has been possible to analyze the detected situation and improve management. Progress has been noted in the investigation of such cases, to determine underlying causes and individuals responsible.In this regard, he assured that the Ministry of Foreign Trade and Investment will continue to coordinate work with the Attorney General of the Republic’s Office.President Díaz-Canel recalled that Army General Raúl Castro Ruz, first secretary of the Party Central Committee, referred to the issue in 2017, stating that problems in foreign trade operations are extraordinary events, and merit close attention.Following this advice , Díaz-Canel emphasized, the governing authority of the Ministry of Foreign Trade and Investment has been recovered. He acknowledged that, although a more coherent system of detection and enforcement has now been established, problems must be definitively resolved.He insisted that daily analysis of issues must be conducted, to ensure that problems do not accumulate, and a greater response capacity is developed.

DEVELOPMENTS IN TRANSPORTATION

Minister Malmierca also presented a comprehensive report on work in the areas of foreign investment, use of external credits, and exports by entities affiliated with the Ministry of Transportation, a priority sector for the development of the country’s infrastructure, which has a significant impact on the functioning of the rest of the economy.Malmierca explained that the evaluation of these issues is vital to identify positive experiences, review difficulties, vulnerabilities, and project superior results.He recalled that transportation is among the sectors prioritized in foreign investment policy, to promote port infrastructure; construction and repair of ships and shipyards; the manufacture and repair of components, spare parts, and accessories; as well as the management of railroad shops, among others.He stressed that need is more attention to current operations and the identification of new ones.

At the same time, systematic work is required in providing managers of established enterprises opportunities to continue their training, as well as that of negotiating teams, so that the process of preparing new investments is not delayed.Regarding the use of external credits, he commented that this modality is traditionally used in the sector and that currently important investments are being executed or negotiated in airport, maritime-port, and railway activities.

The Cuban President highlighted the importance of transportation, since it plays a role in practically all economic activities. He stated that foreign investment is needed to improve airports and railways, as well as maritime-port activity, specifically cargo shipment, with great potential given our status as an island.Addressing foreign investment and credit, he insisted on more agile management, to take better advantage of opportunities, closely linked to the preparation of negotiating teams.

He commented that the country has assumed a number of debts to fund transportation projects, with which an important impact can be achieved, for example, in the railroad system, for transportation of cargo and passengers.

INTERNAL ACCOUNTING The Comptroller General of the Republic, Gladys Bejerano Portela, presented a report on the evaluation indiscipline, illegalities, and cases of administrative corruption in 2018, in which she assured that there exists a greater perception of risks and more urgency felt to implement effective internal control systems, focused on better financial-administrative management.Despite progress and the positive examples that are evident in various organizations, she insisted that problems detected are not new, and it has not been possible to put a stop to indiscipline, illegalities, and acts of corruption.

As underlying causes, identified were vulnerabilities in accounting systems; lack of documentation and primary records; incorrect book keeping; absence of daily cross-checks; and the failure to issue receipts for deliveries or the return of products, with poor monitoring of bodies responsible for supervision.Internal accounting systems – she insisted – are not meant only to detect crime, but precisely to avoid it and support efficient management. “Where there is no effective accounting system, the results are ephemeral or do not exist.”The most serious problem – the Comptroller stated – is at the basic production unit and enterprise level.

Hence the importance of spending more time at the primary level and reordering our work to listen more to people. “We do not accomplish anything with people going to courses and acquiring theoretical knowledge, if they do not have management skills.”Commenting on the issue, the Minister of Domestic Commerce, Betsy Díaz Velázquez, acknowledged that the greatest incidence of such criminal acts is within the wholesale and retail sector, hence her ministry’s work has focused on prevention in these arenas.

She commented that book keeping is not being adequately reconciled at the primary level, where most illegalities are taking place, and that measures are being taken to improve accounting.The President emphasized that, as part of efforts to confront illegalities, the problem of fuel theft must be addressed, noting that several measures have been adopted.He mentioned the recent investigation conducted at several transportation bases by Provincial Administration Councils, in which it was confirmed that the most common deficiencies are those identified by the Comptroller General, in relation to other crimes, such as the lack of primary documents to justify levels of activity; a reduction in mileage rates; lack of control of magnetic cards; and poor use of GPS.In many cases, deficiencies occur in entities that do not have defined procedural and enforcement plans. There is no control and this is the responsibility of leaders, who must play a more active role to achieve more efficient use of fuel, he said.

THE ECONOMY’S PERFORMANCE

Minister of Economy and Planning Alejandro Gil Fernández presented a report on the performance of the national economy as of the end of February, a period during which continued growth in exports of tobacco, rum, and seafood was noted.

He explained that in the months of January and February, some 2,093 vehicles arrived in the country, which should have a positive impact on the economy and in meeting the population’s needs. This, he said, should put us in a better position than last year.

Referring to energy resources, he explained that fuel allocations have been cut by 180 tons to entities that have not taken necessary steps to stem theft, as part of the implementation of a Council of Ministers directive to reduce by 50% the amount of fuel assigned for administrative work in entities given poor evaluations.

He also noted that, in the month of February, there were no outages in electrical service due to a deficit in generation during peak demand hours.

Gil reported that delivery plans for rice and beans were surpassed, and that planting projections for various food crops and tobacco are on schedule, with

449,900 hectares planted, representing 100.5% of what was expected by this date.

In terms of the sugar harvest, he pointed out that sugar production is falling short of projections by 16%, primarily as a result of breakdowns at mills. Despite the tension, he said, the industry remains determined to meet its commitments this season.

Tourist arrivals have increased, he said, as compared to the same period last year, and important markets like Canada and Russia have shown growth. On this point, Tourism Minister Manuel Marrero Cruz added that Santa María Cay and Jardines del Rey are consolidating their condition as the country’s most popular tourist destinations.

Gil additionally reported on progress being made is the recovery and development of railroads, including the arrival of silo, flat bed, and tipper cars, which will allow for a significant increase in annual cargo capacity. Plus, a number of box cars and passenger cars are being repaired.

He addressed the situation that has led to a decrease in the production of eggs, mainly the result of shortfalls in the import of poultry feed, which is being stabilized. In February, a total of 133,700,000 eggs were produced, 97.8% of the monthly plan, providing the supply needed for allocated subsidized sales, but not enough to meet demand on the unregulated market. A greater quantity is projected for March, but not yet enough to meet demand.

Shortages of wheat flour have also occurred, due to mechanical and electrical problems in the milling industry. This situation continues to affect the unregulated sales of bread.In this regard, the Minister of Food Industry, Iris Quiñones Rojas, explained that production has stabilized, reaching 43,000 tons in March, a figure that remains below what was projected by some 4,000 tons.

Gil reported on several measures adopted by the government to deal with shortages of products of basic necessity in retail stores, and avoid hoarding. These involve imports for the months of April, May, June, and July of cooking oil, chicken, and MDM for the production of ground meat and cold cuts, although he insisted on the importance of exploiting all potential for agricultural production and advancing local development projects in the food industry.

Finally, the Minister referred to slow progress on housing plans. On this point, President Díaz-Canel directed that the greatest attention be paid to the construction program, noting that rigorous follow-up has not been maintained. If we begin to accumulate more delays and don’t get back on schedule immediately, goals will not be met, he stated.He noted, for example, “There are many housing units that were completed in 2018 but still haven’t been certified as habitable.”
This is bureaucracy, he said, and we are creating another problem for people, since they are living in the homeillegally. Likewise noted were delays in granting construction licenses to both individuals and state entities.

These issues, Díaz-Canel added, will be more rigorously reviewed during coming visits to the provinces by the Council of Ministers, and working meetings will be devoted to evaluating progress in meeting goals for housing construction. Plus, the national press will publish reports, every three months, from provinces and municipalities, on results in this important program.

(Source: Granma)

At a time when efforts are being made to increase the participation of international capital in the country’s economy, deputies were informed of results achieved during the last Havana International Trade Fair.

Likewise submitted to the relevant commission was a report on the country’s work to guarantee the rights of children.

Food production was also analyzed, with emphasis on increasing the application of science and technology in agriculture, in an effort to better meet the population’s needs.

Progress in meeting objectives established to recover tobacco production; growth in tourism, its sustainability, and relation to the rest of the economy; as well as reports from the Attorney General and People’s Supreme Court are scheduled for discussion today.

(Granma)

The improvement process, which has gradually been carried out across the state enterprise sector since 2011, is geared toward giving greater autonomy to these entities, with clearly defined objectives which include separating enterprise functions from those of the state, improving efficiency and organization, as well as ensuring that entities generate capital to reinvest and transforming revenue distribution mechanisms.

The new legal regulations for the Cuban state enterprise system, published December 13 in Extraordinary Official Gazette No.58 represent, according to officials from the Ministry of Economy and Planning (MEP) and the Permanent Commission for Implementation and Development of policy guidelines (CPID), another step toward achieving these goals and aligning legislation with approved policies for the updating of Cuba’s economic model.

Regarding Decree No.336, Johana Odriozola Guitart, the MEP’s legal director, stated that it does not apply to all of the more than 80 Central Enterprise Management Organizations (OSDE), which exist in the country today, but rather those created as part of the process to improve Central State Administration Bodies (OACE) and others which already existed but had been restructured as part of these efforts.

An important feature of these new regulations, she said, “is that the state enterprise system will no longer come under the control of the ministries. The OSDEs will have direct relations with all other OACEs, Cuban state organizations and institutions.

“What does having direct relations mean? Before, in order for the OSDEs and other entities to undertake any procedure with another organization, they had to first request authorization from the ministry with which they were affiliated. Now (once the regulations come into effect) any such activity can be dealt with directly by the president of an OSDE.

“This, in addition to speeding up the process, contributes to separating state functions from those of enterprises by freeing ministries of these aforementioned daily processes, which in many cases, consist of administering resources for the state enterprise system.”
These transformations, noted Odriozola Guitart “also imply an important change in mentalities with relations now based on coordination, guidance, and supervision rather than subordination.”

According to the MEP’s legal director, the new regulations do not mark the beginning of a process, but are rather part of the process of institutional improvement already in place.

The Ministry of Economy and Planning, for example, will now draw up a plan for OSDEs linked to ministries which have undergone the improvement process. In this way, planning processes are more directly to the organization’s economic activity, and to reality, she said

Likewise, after giving a brief overview of Decree-Law No.334, and Decrees No.334 and No.335, Yovana Vega Mato, deputy director of the CPID’s Entity Improvement Department, announced the authorities that had been extended to the state enterprise system and which were previously not applicable to entities undergoing the improvement process.

In this sense she emphasized the work of governing bodies, which represent the interests of the State in the management of the enterprise system, and which were initially designed to deal with entities undergoing institutional improvement.

Their gradual extension to the OSDEs was approved in 2012, with 28 currently in existence and another 23 in the process of being formed.

These governing bodies, noted the official, are responsible for approving OSDE strategic development plans, assessing the relevance of their economic agendas, conducting quarterly checks to ensure that they are complying with managerial directives, and managing the distribution of earnings.

Meanwhile, Vega Mato stressed the importance of adequately training administrators, because new powers mean greater responsibilities.

“At times, gaps in the knowledge and shortcomings in training of those responsible for carrying out transformations at all levels, have meant that we have not always achieved the outcome we had hoped for,” she noted.
Thus a broad training process is set to be carried out starting February, 2018 and involving around 40,000 senior officials from across the country.

Both Yovana Vega and Johana Odriozola stressed the importance of having an Enterprise Law, given that the new regulations represent interim measures until other issues affecting state enterprise management can be resolved, such as financial autonomy, the distribution of resources, and currency and exchange rate unification.

In institutional and structural terms, the new regulations are an attempt to standardize the entire enterprise system, stated Odriozola Guitart, who noted that the success of this process will depend on adequately training cadres responsible for implementing the changes, which affect everyone.

In April 2011, the Sixth Party Congress approved Guidelines six, seven and 15, which state:
The state enterprise system should be composed of efficient, well organized, and effective entities; state and enterprise functions should be separated and the Enterprise Improvement processes be integrated into the Economic Model policies.
In April, 2016, the Seventh Party Congress approved:
-The Conceptualization of the Cuban Economic and Social Model of Socialist Development

- The bases for the National Social and Economic Development Plan through 2030, the nation’s vision, priorities and strategic sectors

- Economic and Social Policy Guidelines of the Party and Revolution for the period 2016-2021.
- Guideline number nine specifies: Proceed with perfecting the state enterprise system, by gradually awarding directors of entities new and clearly defined powers, in order to create more autonomous, effective, and competitive entities, on the basis of a rigorously designed and implemented internal accounting system; with well-organized, disciplined, and rigorous administrative management. Systematically assess the results of its application and its impact.
- Draw up a legal framework to comprehensively regulate enterprise activity.
MAIN TRANSFORMATIONS TO THE CUBAN STATE ENTERPRISE SECTOR (2011-2017)

APRIL 2013
The Council of Ministers grants enterprises the authority to use up to 50% of after-tax earnings to create funds for development, investments, and workers’ salaries, once they have fulfilled their commitments to the State and established responsibilities. Entities are no longer required to submit depreciation and amortization payments to the state budget.
MAY 2013

Resolution No.132 of 2013 of the Ministry of Economy and Planning allows enterprises to offer services or products linked to their social objective to any individual or legal entity. Enterprise directors are responsible for undertaking any secondary activities stemming from the entity’s principal activities as defined in its social objective. Once they have fulfilled their commitments to the state, enterprises are authorized to sell any surplus at market prices.
NOVEMBER 2013
Implemented on an experimental basis, is a new concept of “encargo estatal,” the state’s order, designed to contribute to gradually expanding the wholesale market, by allowing directors to sell (based on market demands) certain surplus goods and services to legal entities, once the enterprise has fulfilled its commitments, and covered all its costs, expenses, and tax obligations.
DECEMBER 2013

The Council of Ministers approves the legal policy and regulations to perfect Cuban export enterprises, based on Guideline 107 designed to “promote the establishment of enterprises and alliances abroad, in order to better position Cuban interests in international markets, provided that it is economically justifiable and appropriate.”
MARCH 2014
Presented are the basic concepts governing relations between the Council of Ministers and OACE with OSDEs, based on the need to separate enterprise functions from those of the state, give entities greater autonomy, and increase their levels of responsibility, efficiency, and management of resources.
APRIL 2014
Resolution No.17 of 2014 of the Ministry of Labor and Social Security, linking wages to results, comes into effect. Other regulations linked to the price of surplus wholesale products and new financial regulations for enterprises are issued.

Likewise, the responsibility of approving an entity’s annual plan, passes from the corresponding sector ministry or Provincial Administration Council (CAP) to the OSDE president.

In order to create more efficient and competitive enterprises, amendments are made to Decree-Law 252 and Decree 281 of the Council of Ministers, regulating the enterprise improvement process, which is part of broader efforts to implement the Economic and Social Policy Guidelines of the Party and Revolution.
JUNE 2014
Issued is Decree-Law No.321, related to the objectives of the ministries of Foreign Trade and Investment (Mincex), Food Industry (Minal), Domestic Trade (Mincin), and Construction (Micons), as part of efforts by the Permanent Implementation and Development Commission to improve Central State Administration Bodies (OACEs).

The measure legally separates these organizations from the administrative activities of the state enterprise sector, allowing for the more comprehensive, organized and efficient functioning of their structures and freeing up public administration bodies, while also strengthening their regulatory, oversight and supervisory role.
OCOTBER 2014
Reviewed are proposals for improving the Ministry of Finance and Prices enterprise system, known as the Caudal S.A. Business Group, which offers professional services in the financial sector, specifically insurance. The proposals are geared toward resolving longstanding and current problems, and strengthening the organization, “which will offer insurance services, asset evaluations, audits, feasibility studies, consultation services, everything related to economic activity and management, in order to support the development of the enterprise sector and non-state forms of management.” These measures are also geared toward facilitating foreign investment in the country.
OCTOBER 2014
New measures linked to the functions and responsibilities of Basic Enterprise Units (UEB) are approved. Central Enterprise Management Organizations (OSDE), UEBs and other organizations, ratified as business entities, and the idea that even though they may have different responsibilities and roles, there is a close link between all of their functions, thus establishing the foundations on which to organize a more efficient and effective state enterprise system.
APIRL 2016
Resolution 6 of the Ministry of Labor and Social Security, which replaces Resolution 17, of 2014, relating to the link between employee wages and results, comes into force.
DECEMBER 2017
Decree-Law No.334: introduces amendments to DL 252/2007 “regarding the continuation and strengthening of the Cuban Enterprise Direction and Management System.”

Decree No.334: introduces amendments to Decree 281/2007 “Regulation for the implementation and consolidation of the Cuban Enterprise Direction and Management System.”
Decree No.335: “On the Cuban State Enterprise System”
Decree No.336: “On the system of relations between central enterprise management organizations.”
All these measures are designed to strengthen the organization, efficiency, and effectiveness of the socialist state enterprise.

(Granma)