Cuba suspends deposits in US dollars
Cubans line up outside a bank branch in Havana on June 11, 2021, to deposit US dollars before the government enacts a new decree that will suspend these deposits in the country's banks.
AFP - ADALBERTO ROQUE
Text by: RFI Follow
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The Central Bank of Cuba announced Thursday, June 10, to suspend deposits in US dollars from June 21.
Due to the US embargo, Cuba is finding it increasingly difficult to transact in greenbacks.
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Since the reinforcement of the embargo by the Trump administration, the Cuban banking system has had more and more difficulty in finding foreign banks or financial institutions that accept dollar transactions with the island.
The American embargo indeed prohibits Cuba from exchanging dollars.
The embargo also has extraterritorial reach because the United States sanctions foreign banks that accept dollars from the island.
Faced with these difficulties, the Cuban Central Bank therefore decided to temporarily suspend deposits in US dollars.
On the other hand, deposits in other currencies remain authorized as well as bank transfers in greenbacks.
Between the American sanctions and the pandemic which deprives the island of tourists, Cuba is plunged into an unprecedented economic crisis.
Consequence: its GDP fell by 11% in 2020.
Taking into account the island's difficulties, the Paris Club, which brings together creditor countries including France has just granted Cuba additional time to repay its debt.
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Cuba
Economy