As U.S.-Cuban relations begin to normalize, the last tensions of the Cold War start to fade away. With this, tourism is expected to grow which will further Cuba’s current economic boom. Currently, if you were to step onto the island, you would have to exchange your U.S. dollars for something called a CUC or Cuban convertible peso. A currency that is friendly to tourists and is treated as an equivalent to the U.S. dollar. Working Cubans receive a different currency known as the “national peso” although CUCs are still required to buy specialty items at government stores. This two currency system isn’t unheard of, with Mainland China continuing to use its Foreign Exchange Certificates until the end of 1994.
The Cuban government, realizing the inefficiency and unrest brought upon by the two currency system, has announced this past October that it will be rolling out a five-step plan to phase out CUCs over the next year. The CUC will be invalidated and the Cuban peso will become exchangeable and float against five different currencies which include the U.S. dollar, the Euro and the Chinese yuan. However this has set off a ripple effect in the country that have Cubans scrambling to preserve their financial stability. Many Cubans harbor deep distrust in the government’s ability to plan financially and this has caused the hoarding of U.S. dollars and the formation of an unstable black market for them. Although the timeline for the phase out remains vague, one thing is clear, Cubans are excited for the economic growth that the future holds.
-- Jessica Ma