The collapse of Cuban peso in the informal market and its recent ups and downs have unleashed doubts in the population and a campaign in official media against the independent digital newspaper El Toque, which publishes the exchange rate that has become a reference on the street.
The media campaign intensified as the dollar rapidly approached 400 pesos, but in the last seven days the Cuban currency has appreciated strongly – today it is trading at 365 – generating incomprehension among citizens.
The attacks denounce that the depreciation of recent months is artificial, intentional and politically motivated. They even talk about “financial terrorism”. El Toque, these media argue without providing evidence, is “front man of the economic war” from Washington and part of a strategy that promotes a social outbreak in Cuba this summer.
Skepticism is rife among ordinary Cubans. For many, who need to buy currency with their meager pesos to resolve daily life in a progressively dollarized economy, the rate is a mirror of the collapse of their purchasing power.
El Toque denies any political motivation
The editor-in-chief of El Toque, José Jasán Nieves, denies to EFE any political motivation and considers that from official circles they are used as “scapegoat” to not face their responsibility in the country’s crisis or undertake the necessary reforms.
“We have no relationship with any conspiracy of any name, of any political sign. Our job is to inform”says Nieves, who left Cuba in 2019 because he believed that he was not “sure” for him to continue practicing journalism on the island.
It assumes that the mechanisms to establish the exchange rate and the theoretical concepts that support it are complex. Also that the rate may not be perfect, although he emphasizes that it reflects the sharp deterioration of the economy.
The combination of the pandemic, the tightening of US sanctions and errors in national policies have aggravated structural problems in the Cuban economy.
The gross domestic product (GDP) closed 2023 below that of 2019. Formal inflation, which in 2021 exceeded 77%has been on the 30%. The Government forecasts a fiscal deficit of 18.5% in 2024.
On the street this translates into shortages of basic goods, blackouts, lack of cash, hopelessness and an unprecedented wave of migration.
However, since 2022, the official rate has been one dollar for 24 pesos for legal entities and one dollar for 120 for individuals.
An Algorithm to follow the exchange rate
El Toque explains that with an algorithm, without human intervention, it follows currency trading announcements in forums and social networks – this Wednesday there were 2,695 – and filters out anomalous and extreme values. The renowned Cuban economist Pavel Vidal supervises the process.
EFE consulted five other Cuban economists and all of them consider the method reliable, although with limitations (such as collecting the value of offers and not final transactions, or using the median and not the mode as the rate).
Two believe that the indicator does not influence the market, while two others say that it affects expectations. Several refer to the information gap it covers and the majority emphasize that the depreciation of the peso is explained by the country’s structural problems.
Nieves talks about a “feedback” between market and indicator because the rate has become the reference. However, he argues, if it were far from popular perception “They wouldn’t pay attention to him.”
Regarding the attacks, he believes that “the propaganda and security apparatus” Cuban “confuses and lies.” He highlights that the attacks began when the rate became a benchmark and that in 2022 a “repressive campaign” ended with his team on the island.
According to Nieves, “he fifty% of your financing” comes from foundations, mainly American and European, but emphasizes that ““No financing conditions the editorial line.” and “much less the management of the foreign exchange rate.”
He clarifies that although it receives a lot of traffic due to the rate, El Toque does not have “economic dependence” of those visits because a 70% They come from Cuba and the island, due to US sanctions“does not monetize on international platforms.”
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Source: Gestion
Ricardo is a renowned author and journalist, known for his exceptional writing on top-news stories. He currently works as a writer at the 247 News Agency, where he is known for his ability to deliver breaking news and insightful analysis on the most pressing issues of the day.
