Thursday, July 24, 2008

The end of Plan Marabu

When Cuba downsized its sugar sector in 2002, the theory was that the land that was freed up – an amount equal to the land already in agricultural production – would be converted to productive agricultural use.

That was the theory. In practice, much of the land remained idle, and Cubans jokingly called the operation “Plan Marabu,” a reference to the nasty bush that take over untilled fields.

Last week’s decree to turn over idle state lands to agricultural producers – state farms, cooperatives, and private farmers – aims to end that plan and start a much more productive one.

Will it work?

A recent BBC report found that in Pinar del Rio, there are obstacles: low pay, lack of equipment, and for some, lack of interest in life on the farm.

Independent economist Oscar Espinosa Chepe, in an article he circulated this week, says we have to wait to see if a “real process of transformation” is being initiated. He argues that results would be better if if the land were given outright as property, instead of being granted for 10 years to individuals. That, he says, would eliminate the possibility that the state could take the land back if it is not used for its intended purpose, and it would give Cuban youth “tangible incentives” to return to the land.

It goes without saying that it all depends on people and incentives – if there are substantial numbers of individual farmers and cooperatives that are limited by a lack of land, and if there’s a sufficient profit motive for them to take more land and work it, then there will be results.

The incentive issue depends on the level of tax that will have to be paid for new lands, and on the terms of contracts offered to producers. (All producers have contracts whereby the state provides seed, fertilizer, fuel, and other inputs, and in return the producer pays an agreed amount of produce to the state; the rest is sold on the open market.) I heard from a friend in Cuba (but cannot confirm) that in some cases, new lands are bring offered without contracts, so that the producer would have no quota to meet, and could sell all produce on the open market.

Another limiting factor would be if farmers can’t get the equipment they need, but it seems they’ve got that one covered. Reuters reports that in one place in central Cuba, farmers are being told to place their requests: “We can ask for whatever we need. Machinery, spare parts, irrigation systems, wind mills, land clearing kits, you name it,” said a cooperative member quoted in the report. The materials are provided on credit to farmers, and it’s all supported by credits from Iran and Venezuela. Nice.

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