Cuba's New Sugarcane Cooperatives Ten Years Later

Abstract

The break-up of the state monopoly on land was the most important agricultural policy of Cuba's 1993–95 economic reform process. A new form of agricultural organization replaced the inefficient sugarcane state farm: the Basic Unit of Cooperative Production (UBPC). Official data released at the end of 2003 were used to evaluate the economic performance of the new cooperatives after the first ten years. The first result shows an average rate of decline in the number of UBPC of around 60 units per year. Parameters measuring production also show average annual negative rates of decline: 38,800 harvested hectares, and 860,000 tons of sugarcane. Agricultural yields remained stable during the study period. Other important indicators such as revenue, cost and profitability also show negative trends. Factors that appear to be limiting efficiency and profitability include, among others, a timid system of material incentives, lack of autonomy, excessive governmental control over input and product markets, and absence of foreign investment.