HAVANA.- Cuba says goodbye to the year 2022 among the three countries with the highest inflation the world, according to the analysis by the American economist Steve H. Hanke from the renowned Johns Hopkins University.
With an inflation rate of 175%, Cuba ranks in the Third World. Venezuela took the second place the island had a few months ago when the South American country’s inflation rates hit 289% in December, according to Hanke’s calculations based on data collected Dec. 1.
“Thanks to the communist regime, Cuba’s economic nightmare grows more terrifying every day. Today I measure inflation in Cuba at a punishable 141% per year,” he wrote on Twitter in reference to the full year 2022 analysis.
“The value of the Cuban peso is nowhere to be found. Since January 2022, the Cuban peso has lost 71% of its value against the US dollar,” added the economist, lamenting the destruction of the Cuban national currency.
Zimbabwe remains the world inflation leader at 394%.
According to a BBC Mundo report, Cuba is considered a “chronic inflationary” country in Latin America, along with Venezuela, Argentina, Haiti and Suriname. According to the Economic Commission for Latin America and the Caribbean (Cepal), Cuba ended the year with an index of 34.2% in the region, behind Argentina at 87.8% and Venezuela at 146%.
Inflation in Cuba qualified as the second-worst in the world last summer after rising nearly 10 points in just 10 days and breaking the 200% mark.
The rise of currencies in the informal market shows the ineffectiveness of the Cuban regime’s foreign exchange strategy so far, which, far from dampening the value of these currencies, has helped to increase it, economist Rafaela Cruz warned.
“The progressive rise in the cost of MLC stores, the growing needs of trade by ‘mules’ for tariff flexibility, ongoing migration – costing about $8,000 per capita – a private sector needing to capitalize all added to tourism , which does not take off, will make the need for dollars more and more unsatisfied, hence their price will rise,” argued Cruz.
Pavel Vidal, Associate Professor at the Universidad Javeriana in Cali, Colombia, recently commented, “It appears that the market overreacted in August and September due to a speculative phenomenon driven by expectations and is now correcting itself.”
“However, this correction has a lower limit as the crisis, emigration and inflation continue and there is no program to stabilize the Cuban economy. In other words, the current peso appreciation trend is temporary and has a limit that we will find out soon,” he cautioned.
FOUNTAIN: CUBA DAILY