Wed, May 12, 2004 page6

• Havana limits sales in US dollars

  TRADE RESTRICTIONS Selling goods at ``dollar stores'' has been suspended, except for food and hygiene products, in retaliation for Washington's new measures

  • AP
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  Officials suddenly halted most of the dollar sales that Cubans have come to count on and warned of higher dollar prices for food and gasoline. They blamed new US measures meant to undermine the island's government.

  Scores of agitated people lined up for last-minute purchases at late-night variety stores after the official declaration was read on Cuban state television shortly before 8pm Monday night.

  

  People form a line to buy products in a US dollar store in Havana on Monday after Cuban officials announced they were freezing most sales in dollars.

  PHOTO: AP

  The measure could have dramatic effect on everyday life in Cuba, where hard-currency stores offer plentiful goods -- from soap to spark plugs -- that are available in scant quantities, if at all, at highly subsidized prices in Cuban pesos.

  Except for food, gasoline and personal hygiene products, the announcement said, sales in dollars "are suspended until further no-tice." It was not clear if they would resume at some point.

  It also said that dollar prices would be raised on food and gasoline -- and perhaps other products if the stores reopen. Prices in pesos, the government said, would remain stable.

  Crucially, food and personal hygiene products were exempted.

  Cuba blamed the measure on "the brutal and cruel" measures adopted last week by US President George W. Bush to strengthen the embargo of Cuba and to hasten the end of the country's communist government.

  The announcement said the US proposals "are directly aimed at strangling our development and reducing to a minimum the resources in hard currency that are essential for the necessities of food, medical and educational services and other essentials."

  Many analysts had seen the Bush measures as a relatively modest tweak to the broad US economic embargo that has been in place against Cuba since the early 1960s.

  Bush said Cuban-Americans now can visit relatives on the island once every three years rather than once a year. They can spend US$50 a day rather than the earlier limit of US$164. Visits and money transfers are limited to immediate family members -- excluding uncles and cousins -- and officials and Communist Party members cannot receive funds. More money would be allotted for dissidents.

  Cuban officials have warned the measures could be a possible prelude to stronger US attacks, possibly even an invasion.

  A permanent closure of the dollar stores could be another step back from the liberal reforms enacted in the early 1990s to cope with the loss of aid and trade Cuba had enjoyed with the Soviet Union.

  Possession of dollars was legalized in 1993 to draw dollars from growing tourism and family remittances into the state stores. The government has steadily offered more and more goods in the US currency while the Cuban ration book of items available in pesos has withered.

  Many of those lined up Monday night at shops built into gas stations were buying cooking oil and soap before prices rise. Most expressed frustration at the measures.
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