Learn from Cuba, says World Bank

Henry C.K. Liu hliu at mindspring.com
Sun May 13 21:49:50 MDT 2001

Inter Press Service Finance: Learn from Cuba, says World Bank
by Jim Lobe

Washington, 30 Apr -- World Bank President James Wolfensohn Monday
extolled the Communist government of President Fidel Castro for doing
"a great job" in providing for the social welfare of the Cuban people.

His remarks followed Sunday's publication of the Bank's 2001 edition
of 'World Development Indicators' (WDI), which showed Cuba as topping
virtually all other poor countries in health and education statistics.

It also showed that Havana has actually improved its performance in
both areas despite the continuation of the US trade embargo against
it, and the end of Soviet aid and subsidies for the Caribbean island
more than ten years ago.

"I think Cuba has done -- and everybody would acknowledge -- a great
job on education and health," Wolfensohn told reporters at the
conclusion of the annual spring meetings of the Bank and the
International Monetary Fund (IMF). "I have no hesitation in
acknowledging that they've done a good job, and it doesn't embarrass
me to do it. ...We just have nothing to do with them in the present
sense, and they should be congratulated on what they've done."

His remarks reflect a growing appreciation in the Bank for Cuba's
social record, despite recognition that Havana's economic policies are
virtually the antithesis of the "Washington Consensus", the
neo-liberal orthodoxy that has dominated the Bank's policy advice and
its controversial structural adjustment programmes (SAPs) for most of
the last 20 years.

Some senior Bank officers, however, go so far as to suggest that other
developing countries should take a very close look at Cuba's

"It is in some sense almost an anti-model," according to Eric Swanson,
the programme manager for the Bank's Development Data Group, which
compiled the WDI, a tome of almost 400 pages covering scores of
economic, social, and environmental indicators.

Indeed, Cuba is living proof in many ways that the Bank's dictum that
economic growth is a pre-condition for improving the lives of the poor
is over-stated, if not downright wrong. The Bank has insisted for the
past decade that improving the lives of the poor was its core mission.

Besides North Korea, Cuba is the one developing country which, since
1960, has never received the slightest assistance, either in advice or
in aid, from the Bank. It is not even a member, which means that Bank
officers cannot travel to the island on official business.

The island's economy, which suffered devastating losses in production
after the Soviet Union withdrew its aid, especially its oil supplies,
a decade ago, has yet to fully recover. Annual economic growth,
fuelled in part by a growing tourism industry and limited foreign
investment, has been halting and, for the most part, anaemic.

Moreover, its economic policies are generally anathema to the Bank.
The government controls virtually the entire economy, permitting
private entrepreneurs the tiniest of spaces. It heavily subsidises
virtually all staples and commodities; and its currency is not
convertible to anything. It retains tight control over all foreign
investment, and often changes the rules abruptly and for political

At the same time, however, its record of social achievement has not
only been sustained; it's been enhanced, according to the WDI.

It has reduced its infant mortality rate from 11 per 1,000 births in
1990 to seven in 1999, which places it firmly in the ranks of the
western industrialised nations. It now stands at six, according to Jo
Ritzen, the Bank's Vice President for Development Policy, who visited
Cuba privately several months ago to see for himself.

By comparison, the infant mortality rate for Argentina stood at 18 in
1999; Chile's was down to ten; and Costa Rica, at 12. For the entire
Latin American and Caribbean region as a whole, the average was 30 in

Similarly, the mortality rate for children under the age of five in
Cuba has fallen from 13 to eight per thousand over the decade. That
figure is 50% lower than the rate in Chile, the Latin American country
closest to Cuba's achievement. For the region as a whole, the average
was 38 in 1999.

"Six for every 1,000 in infant mortality - the same level as Spain -
is just unbelievable," according to Ritzen, a former education
minister in the Netherlands. "You observe it, and so you see that Cuba
has done exceedingly well in the human development area."

Indeed, in Ritzen's own field, the figures tell much the same story.
Net primary enrolment for both girls and boys reached 100% in 1997, up
from 92% in 1990. That was as high as most developed nations - higher
even than the US rate and well above 80-90% rates achieved by the most
advanced Latin American countries.

"Even in education performance, Cuba's is very much in tune with the
developed world, and much higher than schools in, say, Argentina,
Brazil, or Chile."

It is no wonder, in some ways. Public spending on education in Cuba
amounts to about 6.7% of gross national income, twice the proportion
in other Latin American and Caribbean countries and even Singapore.

There were 12 primary school pupils for every Cuban teacher in 1997, a
ratio that ranked with Sweden, rather than any other developing
country. The Latin American and East Asian average was twice as high
at 25 to one.

The average youth (age 15-24) illiteracy rate in Latin America and the
Caribbean stands at 7%. In Cuba, the rate is zero. In Latin America,
where the average is 7%, only Uruguay approaches that achievement,
with one percent youth illiteracy.

"Cuba managed to reduce illiteracy from 40% to zero within ten years,"
said Ritzen. "If Cuba shows that it is possible, it shifts the burden
of proof to those who say it's not possible."

Similarly, Cuba devoted 9.1% of its gross domestic product (GDP)
during the 1990s to health care, roughly equivalent to Canada's rate.
Its ratio of 5.3 doctors per 1,000 people was the highest in the

The question that these statistics pose, of course, is whether the
Cuban experience can be replicated. The answer given here is probably

"What does it, is the incredible dedication," according to Wayne
Smith, who was head of the US Interests Section in Havana in the late
1970s and early 1980s and has travelled to the island many times
since. "Doctors in Cuba can make more driving cabs and working in
hotels, but they don't. They're just very dedicated," he said.

Ritzen agreed that the Cuban experience probably couldn't be applied
wholesale to another poor country, but insisted that developing
countries can learn a great deal by going to the island.

"Is the experience of Cuba useful in other countries? The answer is
clearly yes, and one is hopeful that political barriers would not
prevent the use of the Cuban experience in other countries. Here, I am
pretty hopeful, in that I see many developing countries taking the
Cuban experience well into account."

But the Cuban experience may not be replicable, he went on, because
its ability to provide so much social support "may not be easy to
sustain in the long run".

"It's not so much that the economy may collapse and be unable to
support such a system, as it is that any transition after Castro
passes from the scene would permit more freedom for people to pursue
their desires for a higher standard of living." The trade-off,
according to Ritzen, may work against the welfare system that exists

"It is a system, which on the one hand, is extremely productive in
social areas and which, on the other, does not give people
opportunities for more prosperity."

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