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Women in Cuba Turn to Entrepreneurism

By Stevie Borrello

Yamina Vicente risked leaving her steady job as an economics professor to open Decorazon, a party planning service.

 Nidialys Acosta used her experience as a government expert on imports and exports to help make her and her husband’s dream of NostalgiCar, a vintage car service, a reality.

 Niuris Higueras previously helped run a private restaurant, known as a paladar, before turning to Cuba Emprende, a nonprofit training service for Cuban entrepreneurs, to gain the knowledge to build her own licensed paladar, Atelier, from the bottom up.

A growing number of women are seizing the opportunity to become entrepreneurs, or as the Cubans say, cuentapropistas. Many of them are leaving low-paid state-run institutions in a bid to better their incomes.

Niuris Higueras,  left, recently opened her own paladar, Atelier, in a mansion that she and her family renovated after swapping their apartment for the decayed property.

Niuris Higueras, left, recently opened her own paladar, Atelier, in a mansion that she and her family renovated after swapping their apartment for the decayed property.

While definitive statistics are not available, signs suggest that the new private sector is attracting women at a faster rate than men. One reason may be that women dominate many professions in the shrinking state sector. Then, too, many new opportunities are in areas traditionally favored by women. “There are many different options thanks to all of these new businesses that didn’t exist before,” said Magaly Rodriguez, who recently started a private catering business.

John McIntire, a founder of Cuba Emprende, added: “Women aren’t having a lot of babies in Cuba. The fertility rate is below the replacement rate. So women are either postponing or maybe having one kid, and so most of them are trying to get ahead” and make more money in the private sector.

The rise in women entrepreneurs can be seen most clearly through the lens of Cuba Emprende, which has graduated more than 1,000 entrepreneurs since its founding in 2012. The ratio of women to men has significantly changed. It was “originally was 60 to 65 percent men and has now shifted to about 60 percent women” in the program, McIntire said.

The program, which is funded by U.S. philanthropists, began in Havana, and is now active in two other cities, Cienfuegos and Camaguey. Cuba Emprende receives about 100 applications each month, and the majority continue to be from women, said Jorge Mandilego, director of Cuba Emprende, who quipped that he is not surprised by these numbers because his wife proves to him “every single day, women are better administrators.”

Perhaps more importantly, women dominate many professions that are poorly paid in the state sector. Jorge Mario Sanchez, an economist at the University of Havana, explained that women account for approximately 60 percent of the professions, especially law, research and academia. The early cuentapropistas were either those who were not in the work force or who worked at illicit businesses that were eventually legalized. Now many women are leaving their respected positions to seek better financial opportunities in the private sector. State-sector jobs that have been cut were heavily populated by women and, therefore, more women lost their jobs, said Margaret Crahan, a senior research scholar at the Institute of Latin American Studies at Columbia University.

Yamina Vicente, 31, for example, was an economics professor at the University of Havana, but left to open a party planning service, Decorazon. During the early stages of her business, Vicente kept her job as a professor to make a little extra cash. Now, she makes more than she did as a professor. The average pay of professionals employed by the state is 20 to 25 Convertible Cuban Pesos, or CUCs, (the equivalent of $20 to $25) per month.

Julio Alvarez and Nidialys Acosta Cabrera have expanded their company, NostalgiCar, which operates a vintage car service and refurbishes vintage autos. Cabrera, trained as a chemist, was a government purchasing agent, developing many useful contacts for their business.

Julio Alvarez and Nidialys Acosta have expanded their company, NostalgiCar, which operates a vintage car service and refurbishes vintage autos.

Vicente has seen the number of women increase in the private sector, as more business options become available. “At the beginning the different jobs that were offered privately were more male jobs, like paladares and shoemakers,” she said using the Spanish word for privately run restaurants. “But now there were a number of professions introduced like interior designer or sewing or more female jobs, which is also why the number of women is increasing in the last three years.”

The emerging entrepreneurial sector gathered strength in 2011, with new regulations introduced by President Raul Castro that eventually authorized more than 200 types of businesses to be run by entrepreneurs. These included everything from locksmith and carpenter to party entertainer and animal caretaker.

Nidialys Acosta was able to capitalize on both her state-business connections and the new regulations when she and her husband, Julio Alvarez, expanded their company, NostalgiCar, which operates a vintage car service and refurbishes vintage automobiles.

Acosta studied chemistry at the University of Havana and worked in import/export for the government for 11 years. She used her contacts and her knowledge of finance to run NostalgiCar’s logistics and its car service. When new rules recently allowed government agencies to contract with private companies, she signed contracts with almost all the tourist agencies in Havana.

Recently, new regulations allowed Acosta and Alvarez to rent their own garage.

But the pressures of being cuentapropistas are manifold. Taxes are high. Credit is scarce. Government regulations are constantly changing. And juggling work and family is often difficult. The couple’s son calls them “liars” because they said they would have more time to take care of him once NostaligiCar was opened.

Magaly Rodriguez, 47, a single mother of three teen-age boys, said she felt the constant stress of running her small catering business while caring for her family. .

Magaly Rodriguez, 47, a single mother of three boys, said she felt the constant stress of running her small catering business while caring for her family.

Rodriguez, 47, is a single mother of three teen-age boys, 19, 15 and 13 years old, who said she also felt the constant stress of running her small catering business while taking care of her children and her dog. To her, a 12-hour day is an easy one.

“It’s really difficult and I feel like work doesn’t ever end, because I’m working and then the kids get home and they want to eat and then I have to take care of the dog’s food, and it’s all really complicated,” she said.

The falling birth rate, which was exacerbated during the post-Soviet years of scarcity, the so-called Special Period, continues to decrease, causing serious demographic problems. Only 17.2 percent of the Cuban population is under the age of 14, according to Sanchez, the economist. Close to 65 percent of the population is aged 15 to 59. And 18.3 percent are over 60. Many Cuban families, he explained, are composed of five people – two grandparents, two parents and one child; 1.6 people, he said, have to take care of five.

Many women entrepreneurs are determined to move into traditionally male-dominated fields. Take Niuris Higueras, a Cuba Emprende graduate, who recently opened her own paladar, Atelier. “The majority of paladar owners are men, so you can say about 20 percent are women and 80 percent are men,” Higueras said.

While she had years of previous restaurant experience, it was not until graduating from Cuba Emprende that she felt ready to open her own. Atelier is housed in an old mansion in the Vedado neighborhood. Today the mansion is adorned with crystal chandeliers, wood-beamed ceilings and expensive artwork, but it was not always in such good condition. Higueras traded a modern four-bedroom apartment for the mansion, which was, at the time, a wreck. She and her family renovated the building.

However, Higueras’s real estate gambit illustrates how the opening of the economy is leading not only to growing income disparities in Cuba but also to another social divide. What little capital cuentapropistas have – whether men or women – comes from property or automobiles their families were able to hold on to from before the revolution or from remittances, which alone make up 70 to 80 percent of the funding for new businesses, according to McIntire. And the entrepreneurs with those resources are mostly white.

Still, all cuentapropistas – men and women, black and white – are counting on more reforms to ease the still difficult environment in which they operate. High on their wish list are: the establishment of wholesale markets, greater access to credit and faster Internet service.

Cuban Entrepreneurs With a Conscience

Article and photo by Raquel Blanco

Pavel Garcia walks down the streets of Old Havana, a young man with tousled shoulder-length hair and a beard, dreaming of opening his own nongovernmental organization, or NGO – which in today’s Cuba is still a near-impossibility. He is trying to ensure that tourist dollars trickle down to local communities that have not yet benefited from the cuentapropista boom – the private entrepreneurs who are capitalizing on both changes in government economic policy and the gentrification of Old Havana.

Garcia works in Old Havana, which is undergoing serious renovation. The government, with support from UNESCO, has restored several colonial-style neighborhoods and plazas, creating an atmosphere that could rival the historic districts of Madrid or Barcelona. As more private businesses emerge, tourists are finding an array of paladares – private, often family-run, restaurants – and high-end shops.

Pavel Garcia, an entrepreneur, is trying to find ways to provide economic stimulus and benefits at the community level.

Pavel Garcia, an entrepreneur, is trying to find ways to provide economic stimulus and benefits at the community level.

Dollars and CUCs, the local currency that is pegged to the dollar and formally called Cuban Convertible Pesos, flow through Old Havana and represent a significant increase in earnings for many Cubans. The average state-paid salary of, say, a doctor, is the equivalent of about 20-24 CUC a month. People who work independent of the state, in tourism for example, or the restaurants, can make 15 CUC a day.

This disparity in incomes can be traced in great part to Cuba’s dual-currency system. The CUC, which has buying power equivalent to the U.S. dollar, was initially used mostly for tourists. The peso (CUP), which is exclusively for locals, is valued at about 5 cents. (On the streets of Havana, markets today might sell in pesos and convert to CUCs, or exclusively in CUCs.) This great devaluation of the Cuban currency has led many people to leave state jobs or to take additional jobs in the private sector to earn CUCs. The government is expected to merge the two currencies this year.

Although the concept of working for $20 a month may seem unfathomable to many people, Cubans do receive an array of social services, including free health care and education, as well as subsidized utilities and housing.

For about 20 years after the revolution ended in 1959, income inequality was not a major issue. The Gini coefficient, an indicator of a country’s spread of wealth, ranges from 0, which is basically a communist utopia with no inequality, to 1, which indicates high income inequality. In 1963 Cuba had a Gini coefficient of .28, according to a study by the Institute for Cuban and Cuban-America Studies at the University of Miami.

A low level of income inequality in Cuba reflected the fact that almost everyone worked for the state. In 1989, only 0.7% of the population was considered self-employed, according to Prof. Ted Henken of Baruch College/CUNY. Then came the “Special Period,” in the early 1990s, when the Soviet Union collapsed and withdrew its economic support of Cuba. Shortages of food, medicine and much else caused the government to recognize the need to change its economic plan. Foreign investment and small businesses were needed to help revive the economy.

Since then, Cuba has gradually sanctioned small businesses and cooperatives, which are businesses that are run by their employees. One result is that income inequality has continued to widen. This has led many Cubans to wonder how their country can preserve its socialist values even as its moves to liberalize its economy.

“It is not easy, but it is not difficult,” Garcia asserted. Cubans seem to unite around the idea of solidarity. Regardless of their business, they seem to believe that they can help each other out and that they stand a better chance of progressing economically if they pull together.

Even many cuentapropistas — a word derived from the Spanish term “working for your own account” – say they want to spread their wealth. Garcia said he believed that sometimes all people need is a mediator to help them convert that desire into something tangible.

This problem animates Garcia and many of the cuentapropistas he works with. In the beautifully refurbished Plaza Vieja, in Old Havana, they created programs that aim to use the plaza for the community.

<center>Photo by Trudy Knockless</center>

Photo by Trudy Knockless 
Aleida Gonzales Vera joined with neighbors to merge small neighboring houses into a small hotel that can host up to 50 students.

While the “government invests money in the Plaza,” Garcia said, the locals “feel like ‘it’s not for me,’ it’s for the tourists.

For example, at the private restaurants in the plaza, menu prices are beyond the means of a state-paid Cuban. At one coffee shop, La Bohemia, an employee said an average Cuban could come only “once in a while,” and that no more than 30 percent of its customers are local Cubans.

Garcia wants businesses “to go to the community with the new money and say what do you want?” He has successfully run a chess tournament in La Bohemia for groups of elderly people and young children. He has also organized sporting events for young people

Garcia hopes to have more businesses participate in arranging festivals or public assemblies in the Plaza. So he is helping the people who have lived in Old Havana for years to see that “this beautiful place is for you, too.”

Many other cuentapropistas are seeking ways to give back to the community.

La Moneda Cubana, a successful restaurant in Old Havana, prides itself on developing employment opportunities for young people in the community. The owner Miguel Angel Morales, known as Mickey, started a school to help train troubled youth as waiters. After an intensive course in English, history and etiquette, the trainees have the possibility of working in his restaurant and earning 20-30 CUCs a day.

Take Alain Miguel Cardenas Suarez, a handsome 24-year-old who freely acknowledges that he worked as a prostitute before coming to work at La Moneda. He had been studying mechanical engineering in Havana for three years when he realized that he could no longer continue in school and cover his basic living costs. He dropped out and found himself on the street. “I had to sell myself” to survive, he said.

Youths who are not in college or working sometimes become involved in black market activities and can go to jail for up to two years. So when Cardenas heard about Morales’s school, he jumped at the opportunity. Now he works in the restaurant. Morales said he had helped more than 50 youths and has employed about 15 of them in his restaurant.

About a 15-minute walk from La Moneda, the owner of a barbershop has developed a similar model. He established a barbering school to train teens to become stylists and helped build BarbeParque, a playground for local children, which he hopes will help Cubans see that cuentapropistas can benefit the community. All the parts of the playgrounds take the shape of barbers’ tools like scissors, a comb and a razor. The plan was designed by college students studying architecture and paid for by the government.

The park is more than just an attraction for children. While cuentapropistas have often been vilified by government officials as greedy capitalists, BarbeParque offers another perspective on what cuentapropistas can contribute to this solidarity-minded society.

This sense of community has flourished beyond the newly renovated streets of Old Havana to neighborhoods like El Vedado, where Casa Vera, a casa particular, or bed-and-breakfast, functions as an informal cooperative.

The casa particular hosts college students from abroad and offering meals, laundry service and cultural activities, such as salsa classes.

The owner, Aleida Gonzales Vera, has joined with neighbors to create one large operation by merging several small neighboring houses. Gonzalez’s house can accommodate about a dozen students; in the common areas meals are served and students can hold meetings – or get salsa-dancing lessons.

The informal arrangement with her neighbors allows Gonzalez to host groups as large as 50 students. But when she uses rooms owned by her neighbors so that she can host larger groups, she said her profits come only from serving meals to the students. She does not collect fees for managing the enterprise.

But, in today’s Cuba, despite new regulations meant to open economic opportunity, many social and business arrangements are still highly tenuous. Take the case of what was once a popular restuarant-cum-dinner theater known as El Cabildo, which was run by Ulises Aquino. The opera impresario also created La Opera de la Calle, which repackaged classical opera to make it more accessible to ordinary Cubans, according to Entrepreneurial Cuba by Archibald A. M. Ritter and Ted E. Henken. Aquino ran a successful paladar and theater for tourists, to whom he charged the equivalent of $25 cover, which helped pay for the theater’s high overhead and “generous salaries” for 130 employees. At the same time, Aquino sponsored free cultural and educational activities for children, and staged La Opera de la Calle performances for locals, at a much lower cover charge. The operation, wrote Ritter and Henken,  was “born out of a felicitous combination of Aquino’s individual entrepreneurial initiative and his clear commitment to community uplift.”

But the authorities carried out a surprise raid of El Cabildo in 2012, and shut it down. Since many of Cuba’s leading government officials, including the vice minister of culture had praised the theater, Henken and Ritter speculate that the raid signaled that a “hidden fifth column” within the government bureaucracy was seeking to put the brakes on Raul Castro’s reforms.

Indeed, like both Aquino and Garcia, many cuentapropistas say they embrace socialist values. But without a formal, state-sanctioned NGO or philanthropic sector, their efforts are unlikely to go far.