Small Businesses Sprout Out Of Front Yards In Cuba

Jul 6, 2011

Fidel Castro nationalized Cuba's small businesses in 1968, closing thousands of family-owned shops, down to the tiniest fruit stand. His brother Raul is starting to undo that bitter legacy, giving out more than 300,000 new self-employment licenses in the past eight months.

The entrepreneurs are now filling Havana's sidewalks and street corners; the next step may be moving them back into shops that were seized long ago.

Urban Marketplaces Popping Up

On the front patio of an elegant 1940s home in Havana's Miramar neighborhood, Cuba's new economy is on full display — it includes second-hand blouses, cheap shoes and a giant rack of pirated CDs.

One makeshift store and its booming stereo belong to 26-year-old Ivelis Ramos, who was laid off from her state job as a bookkeeper last year.

"I didn't used to have this freedom to relax, to dance and to talk to customers," Ramos says. "Someday I'd like to have a real store of my own."

Ramos is one of several vendors along the sidewalk who have tarps and tattered patio umbrellas to shield them from the brutal tropical sun. It looks like the kind of urban marketplace common to other Latin American capitals, but not communist-run Cuba.

The front yards and doorways of Havana's once-graceful boulevards are starting to resemble outdoor flea markets, while much of the commercial property owned by the state remains vacant or underutilized.

Government Sending Mixed Signals

"It's very important to understand that the city of Havana was there when the revolution arrived," says Miguel Coyula, an architect and urban planner in Havana. "So the revolution tried to introduce a new social model, but in the existing city. Sometimes it works; sometimes it doesn't."

Coyula says that when the small businesses were nationalized, much of Havana's commercial space was converted to housing. Now, many homes are doubling as businesses as Cubans set up restaurants and workshops in their living rooms, or rent their yards out as retail space.

Other vendors wander through parks and neighborhoods — even hospitals and government stores — drawing complaints. The state says it will lease commercial space to the new entrepreneurs, but their businesses are so small it's not clear how they'd fill it.

Shoe repairman Rene Martinez counts out receipts showing what he pays the government to set up a stall in a vacant parking lot near a Havana supermarket. The state charges him about $1 a day, but offers little in return beyond a bare patch of asphalt outside a ruined 1950s-era diner with weeds sprouting from the roof. Some of his fellow vendors have talked about banding together and refusing to pay the daily fee. Martinez says he took home less than 30 cents the day before.

"I thought working here would help me relax, but instead I'm all agitated because of these taxes," Martinez says.

Such are the mixed signals coming from the Cuban government, which seems unsure whether to help the entrepreneurs or regulate them to death. It has limited the range of occupations that self-employed Cubans can perform legally, but it has also encouraged hiring by waiving payroll taxes for business with up to five employees.

Loans and microcredits from state banks are supposedly coming next, and little homemade flyers are starting to appear on doormats and car windshields — the first signs of advertising.

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