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Obama Hopes Historic Visit Will Boost Cuba's Emerging Private Sector
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Obama Hopes Historic Visit Will Boost Cuba's Emerging Private Sector

Economy

Obama Hopes Historic Visit Will Boost Cuba's Emerging Private Sector

Obama Hopes Historic Visit Will Boost Cuba's Emerging Private Sector
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While the U.S. is allowing more Americans to travel and do business with Cuba, the communist island's private sector is just emerging. President Obama is hoping his visit will give it a boost.

ROBERT SIEGEL, HOST:

Even as the American visitors talk about their hopes for Cuban entrepreneurs, the opportunities for U.S. businesses in Cuba are growing - Airbnb, Verizon and Netflix are now in Cuba. Soon, Starwood Hotels will open its doors in Havana, and Carnival Cruise ships will dock in the country's ports. NPR's Carrie Kahn reports from Havana on what all of this means for the Cubans who strike out on their own.

CARRIE KAHN, BYLINE: Ruben Valladares Martin makes bags - paper bags - all sizes and shapes. Out of his small family home near Havana's airport, Valladares and his 30 employees cut the paper, glue the corners and assemble the handles all by hand.

RUBEN VALLADARES MARTIN: (Speaking Spanish).

KAHN: "We had no idea what we were doing when we started this four years ago," says Valladares. But he says his bags are the best.

VALLADARES: (Speaking Spanish).

KAHN: "Look at this bag. It's so sturdy, it can hold up to four bottles of Rum," he laughs, bragging about the latest quality control measure in his workshop. Valladares sells the bags to other private businesses, restaurants and stores and a growing number of state-owned firms as well. He silk-screens logos on the bags, too. His silk screener makes up to $150 a month. Most others like handle-gluer Vilma Romero make 70 - about five times the average state salary.

VILMA ROMERO: (Speaking Spanish).

KAHN: "I feel like heaven fell into my hands when I got this job," says Romero. Bag entrepreneur Valladares is part of a growing private sector that has taken off in Cuba in the last five years since the communist leadership cracked open the state-run economy. Now with everything from restaurants to beauty salons, as much as 25 percent of the Cuban economy is in the hands of these businesspeople known as cuentapropistas - roughly translated the self-employed.

While growing in number, it's not been an easy road for these budding entrepreneurs, many of whom met with President Obama today in Havana. Valladares says it's tough finding raw materials for his bags. Business owners complain about being limited to just 12 employees, not having access to credit or ways to export their products.

Like the Cuban leadership, University of Havana economist Juan Triana blames the U.S. embargo for dysfunction of the state-run economy. He says Cuba has spent 50-plus years devising a system to sidestep that embargo to survive. It's going to take a while to create a new one.

JUAN TRIANA: (Speaking Spanish).

KAHN: "We're not talking 10 years," he says, "but we're not saying we can do it in one, either." Cuban officials have shown in recent days they can be nimbler with respect to American businesses. They just signed the agreement with Starwood Hotels and Resorts Worldwide, allowing the chain to manage three hotels here. And they granted a license to two Alabama entrepreneurs to manufacture and sell tractors to Cuban farmers. Ruben Valladares says despite all the challenges, he says he can see his bag business growing.

VALLADARES: (Speaking Spanish).

KAHN: "Cuba needs this new relation with the U.S. to help us prosper, and," he says, "the U.S. needs us for all the opportunities available to businesses here." Carrie Kahn, NPR News, Havana.

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