What has been the impact on the economy after the implementation of the task ordering?(+ Video)

A look, from the economic, to the results of the implementation of the task ordering, its impact on the business system, as well as the wholesale and retail inflation, and the changes in the current monetary environment, offered the deputies Marino Murillo Jorge, Head of the Permanent Commission for the Implementation and Development of the Guidelines.

As part of the implementation, he explained, a temporary work group was created, taking into account that it had to be rectified, in the march, design problems and making adjustments of the process, as initially foreseen, also from the difficultsituation presented by the national economy and deviations from the context in which the order has been carried out.

To date, he said, this group has held 93 meetings and 294 issues have been presented, while 256 decisions were made, which led to the issuance of 171 legal norms, of which they are already in process 30.

To measure the results of the implementation of the ordering, it is necessary to make a comparison against the design of the task itself, that is, see what has happened in practice during these last months,.

As part of this reflection, Murillo Jorge explained that the financial statements presented by the companies to the National Office of Statistics and Information have been taken as a source of information, and that these data are expressed in Cuban pesos with the exchange rate of 1x24,In the cases that correspond.

Until the closing of the second semester - because some financial indicators took until the month of August -, net sales in the business system are in the order of 308 billion and 14 billion exports, he said."The profits, in an environment of devaluation of the peso in the first semester, were 33 billion".

He affirmed that losses for about 7 billion are accumulated, and 82 % are concentrated in the agricultural sector, provincial trade activities and other subordinates to the territorial government, among others.

Some companies, technologically similar, had losses and others not, the latter tell us about their ability to endure devaluation and management efficiency, he clarified.

On the expenses for losses and missing goods, 1 609 million pesos are counted, of them, 632 million in the company Medicuba S.A.and 572 in the provincial company of Havana, 75 % of the total.

Before the task, in a 1x1 environment, for each sales weight, companies received 14 cents from the budget, which implied that a company that received a state subsidy could have profits and, in addition, distribute it among its workers, said theHead of the Permanent Commission for the Implementation and Development of the Guidelines.Now, he said, he stayed in four cents, and that is a positive result of the ordering, since the subsidy to the inefficiencies of the business system is reduced.

Of those four cents, 75 % - they mentioned - are associated with consumption subsid the objective.

When referring to the profitability of business structures, he said that, on average, it works with 17 %, and that some companies, such as the agricultural sector work with a lower index, specifically 6 %.

What happens to wholesale and retail inflation?

Murillo Jorge indicated that for the first year a devaluation of 2 300 % in the wholesale circuit was designed, with a mobile inflation target of 1 200 %, and as estimated for the end of the year that figure will not be reached.

«The adjustment expected from the economy, that wholesale prices grew less than devaluation, was achieved.The problem is in retail inflation ».He argued that whenever he devalates in those magnitudes, there is price growth and, therefore, inflation.

On the other hand, in the informal currency market there is a exchange rate of 1x70, which represents an inflation of 6 900 %, and affects both wholesale and retail inflation, he said.

«This translates, for example, that an economic actor who achieves raw materials in the environment of state companies (1x24) and form a price in the scope of 1x70, will have great profits without being very efficient or productive, and thatYou can tax inflation conditions in the future ».

How To Cope with Grief: A Spiritual and Psychological Guide https: // t.CO/W5YB6GFUVD

— Abdullahi Buhari Fri Aug 21 01:36:53 +0000 2020

"In addition, if prices in the internal economy are formed based on 1x70, and the imported ones multiply by 24, then national products would be more expensive than imported ones".

To regulate this, the Ministry of Finance and Prices works in a wholesale price policy for 2022, in order to administer these exchange rate differences, he reported.

Among the recommendations to elaborate this policy, it is to take into account the behavior of the prices of the foreign investment sector and other actors, since they have grown at a higher rate, as well as the incidence of the exchange gap in the price formationof non -state economic actors.

In short, he continued, in the business system the weight was devalued, a process of correction of relative prices began, the adjustment of the designed economy occurred and accounting has been transparent.

Regarding retail inflation, he explained that according to the design of the task, the total sales were going to grow 1.6 times and the population's income, five times, and under that calculation the decision was made to make the order andThe salary reform.All wage earners were supposed to be better than before the task;More, in practice it has happened that people are facing prices up to ten times larger than expected in retail inflation, he explained.

"Where retail prices grow more is in transport, in housing (for example, the purchase of construction materials), and in food, and all this has a great impact on domestic life," he said.

On the other hand, the average salary is 3 888 pesos, and the basket of designed reference goods and services was 1,528 pesos, which was what a person should consume in the month;However, the cost levels of that basket have been rising, especially in Havana and in the eastern provinces, he said.

For example, in March that basket was 2 347 pesos, in May 2 628 pesos, in June 2,700 pesos and in August 2 821 pesos, he said."This last value, August, is 1.85 times the cost of the basket we made to calculate the minimum pension, which means that those who have a minimum pension and salary, today are not consuming the expected ones".And while anti -inflationary measures were designed, they did not have all the desired effect, he added."That today a Cuban eats something on the street is costing twice as much as designed".

All of that translates into the retaining inflation, superior to the designed, has reduced the purchase capacity that the salary reform, the growth of pensions and social assistance gave, especially in the sectors of lower income, he said.

He emphasized that, if we want there to be a monetary balance, the State has to collect 92 % of the population's monetary income, and according to the latest estimates, the figures are around 67 %.

Finally, he said that the scenario on which the economy has become very complex as a result of the resurgence of the EE Government's economic blockade.UU., the aggravation of the Pandemia of the COVID-19, and the consequences of the international economic crisis.

The combined effects of the situation on the economy and the expected processes of the ordering have generated manifestations not associated with the designed, he pointed out.

Although main risks were identified, including inflation, there are objective conditions that favor inflationary risks such as the deficit of the supply, the increase in income of the population, which increases its solvent demand, the change rate of the informal marketabove the official, and the high fiscal deficit, he commented.

Murillo Jorge added that within the main impacts of the ordering process is the devaluation of the CUP, which has allowed progress in the complex process of correction of relative prices in the business sector, and that a real devaluation occurs.

As a final recommendation, he called on the business system to take advantage of this correction, as well as to apply the measures designed to make their management more efficient.