Published Wednesday, September 10, 1997, in the Miami Herald

Exiles' money helping Castro, study says

By PABLO ALFONSO
Herald Staff Writer

Cuban exile dollars have propped up the regime of President Fidel Castro for the past five years, hampering Washington's efforts to tighten its trade embargo, according to a study by the United Nations' Economic Commission for Latin America and the Caribbean (ECLAC).

Cash remittances sent by exiles to their relatives on the island added up to $800 million last year, the 300-page ECLAC study said.

Other sources estimate the remittances at $400 million to $500 million, and see a recent downward trend.

``The influx of external remittances, estimated at $800 million in 1996, eased the crisis for a great many Cubans . . . who were able to become self-supporting contributors to the country's economy,'' the report said.

The figure is remarkable in view of the fact that President Clinton in 1996 barred cash remittances by exiles to relatives in Cuba. The action was intended to punish Castro for the downing by Cuban air force fighters of two unarmed aircraft of Miami-based Brothers to the Rescue.

The ECLAC study was conducted by a group of experts with the collaboration of the Cuban government.

An ECLAC expert, who spoke on condition of anonymity, told The Herald that the $800 million figure ``surpasses the combined amount of all payrolls for salaried labor on the island, at the current rate of exchange.''

``Put more clearly: In terms of value, more money is received from abroad than is paid in wages throughout the country,'' the expert said. ``In addition, that income surpasses the current net income earned by the country from the sugar harvest or the tourism industry.''

Quoting official statistics, the ECLAC study said that between 30 and 60 percent of the population in nine of Cuba's provinces have access to hard currency. In the other five provinces, the figure is 30 percent or less. The report did not name the provinces.

``The legalization of foreign-currency holdings and the opening of hard-currency stores encouraged this type of cash transfer,'' the report said.

The Cuban government legalized the holding of foreign currency in 1993 and hurriedly opened stores that accepted payment only in dollars -- sent mainly by Cubans living in the United States.

``Purchases at those stores totaled $620 million in 1996, a significant segment of the domestic consumption, at the 20-for-1 rate of exchange,'' the report said.


Herald staff writer Juan O. Tamayo contributed to this report.

Copyright © 1997 The Miami Herald