12/29/13 - BBC News - Cuba eases restrictions on loans to small businesses
The Cuban government has eased restrictions on loans to private borrowers
in the latest measure aimed at boosting the island's troubled economy.
Individuals and small businesses can now borrow smaller amounts and have
more time to pay back the government.
President Raul Castro had launched the programme two years ago as part of
measures to reform Cuban socialism.
The minimum lending has been reduced from 3,000 to 1,000 pesos (£41; $67).
The measure was published in the official gazette.
People will also be allowed to use their houses or jewellery to guarantee
The maximum period of the loans has been extended from five to 10 years.
Earlier this month, the Cuban government lifted restrictions on private
individuals buying new and second-hand cars.
Any Cuban citizen or foreigner with enough money will now be allowed to
import the vehicles through an official agency.
Previously, official permits were required and they were often issued to
government officials, doctors and other people with access to the
authorities, such as sports stars.
The main aim of the reforms introduced in the last few years is to keep the
economy afloat, says the BBC's Sarah Rainsford in Cuba.
Our correspondent says the latest announcement appears aimed at promoting
the culture of credit, which remains a novel concept on the island.
Although Cubans have been able to request bank credits since 2011, barely
500 are reported to have borrowed money.
The government wants to boost that figure as part of its efforts to
encourage 1.5 million people to switch from the state payroll to the new
Some 440,000 people, or about 9% of the Cuban workforce, are now
But analysts point out that the new businesses face a big problem - they
all chase a very limited number of Cubans with cash to spend.
In his speech before the National Assembly in Havana on 22 December, Mr
Castro called on the United States to establish "civilised relations" with
But he warned that Cuba and the US - old Cold War rivals - "should respect
The US broke relations in 1961, two years after the revolution led by
Raul's brother, Fidel Castro. It imposed an economic embargo on the island
shortly after that.
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