DE ESTENOZ; address: Cuban Interests Section, Swiss
(202) 797-8518

Diplomatic representation from the US: none; note--the US has an
Interests Section in the Swiss Embassy, headed by Principal Officer
Michael G. KOZAK; address: USINT, Swiss Embassy, Calzada between L
and M Streets, Vedado Seccion, Havana; telephone: 33-3551 through
3559 and 33-3543 through 3547 (operator assistance required); FAX:
33-3700; protecting power in Cuba is Switzerland

Flag description: five equal horizontal bands of blue (top and
bottom) alternating with white; a red equilateral triangle based on
the hoist side bears a white, five-pointed star in the center

Economy

Economy--overview: The state plays the primary role in the economy
and controls practically all foreign trade. The government has
undertaken several reforms in recent years to stem excess liquidity,
increase labor incentives, and alleviate serious shortages of food,
consumer goods, and services. The liberalized agricultural markets
introduced in October 1994, at which state and private farmers sell
above-quota production at unrestricted prices, have broadened legal
consumption alternatives and reduced black market prices. Government
efforts to lower subsidies to unprofitable enterprises and to shrink
the money supply caused the semi-official exchange rate for the
Cuban peso to move from a peak of 120 to the dollar in the summer of
1994 to 21 to the dollar by yearend 1998. New taxes introduced in
1996 helped drive down the number of self-employed workers from
208,000 in January 1996 to 155,000 by July 1998. Havana announced in
1995 that GDP declined by 35% during 1989-93, the result of lost
Soviet aid and domestic inefficiencies. The drop in GDP apparently
halted in 1994, when Cuba reported 0.7% growth, followed by
increases of 2.5% in 1995 and 7.8% in 1996. Growth slowed again in
1997 and 1998 to 2.5% and 1.2% respectively. Export earnings
declined 22% in 1998, to $1.4 billion, the result of lower sugar
export volume and lower world prices for nickel and sugar. Import
expenditures also fell 15% to $3.0 billion, in part due to lower
world oil prices. Tourism and remittances play a key role in foreign
currency earnings. Living standards for the average Cuban remain at
a depressed level compared with 1990.

GDP: purchasing power parity--$17.3 billion (1998 est.)

GDP--real growth rate: 1.2% (1998 est.)