Havana (AFP)

The minimum wage in Cuba will be multiplied by five and the price of bread sold through the supply book by 20 as part of the reform aimed at unifying the two local currencies from January 1, according to details published Friday in the Official Journal. .

President Miguel Diaz-Canel announced Thursday evening this reform, promised for years but constantly postponed, which will put an end to the monetary duality in force on the island for 26 years but will lead to a general increase in prices.

The reform will make the convertible peso or CUC, aligned with the dollar and born in 1994 to accompany and then replace this currency, disappear in six months.

Only the Cuban peso or CUP will remain, which is worth 24 times less.

The measure is intended to make the Cuban economy more efficient and more readable for foreign investors, at a time when the island, affected by the strengthening of the American embargo and deprived for months of tourism currencies due to the coronavirus pandemic, needs new money.

To compensate for the high inflation expected, "it is necessary to establish a minimum wage in the country which guarantees the satisfaction of the basic needs of the worker and his family, as well as a salary scale applicable to all workers", specifies a resolution of the Ministry of Labor, published in the Official Journal.

The text establishes "the country's minimum wage at 2,100 Cuban pesos per month", $ 87, an increase of 525% over the current minimum wage ($ 17).

It also sets 32 salary levels depending on the type of job and hours worked, the highest being 9,510 pesos ($ 396).

Currently, the average salary on the island is 879 Cuban pesos, or $ 37, according to the National Bureau of Statistics.

In addition, the daily bread of 80 grams that each Cuban receives via the supply book (libreta), a great symbol of Cuban egalitarianism, will see its price, unchanged for 40 years, multiplied by 20.

However, its price will remain modest: it will go from 5 cents of Cuban peso to one peso, or 4 cents of a dollar.

The prices of essential services like water, gas, electricity and transportation will also increase, as will taxes.

The Official Journal on Friday published the list of new prices for many products, some of which are sold at low prices through the "libreta".

The government has already warned that it wants to remove the majority of subsidies, which are essential support for state enterprises but also for residents.

Eventually, the supply book will disappear, only certain foods and drugs being kept at low prices.

The process, announced in 2013 but regularly postponed pending the best time to do so, comes in the worst context: the Cuban economy is expected to fall by 8% this year, according to forecasts by Cepal, the economic commission of the UN for Latin America.

In lack of foreign exchange, the country had to restrict its imports, which worsened the shortages and the queues in front of the supermarkets.

© 2020 AFP