WebHeader_Grove.png
Play Live Radio
Next Up:
0:00
0:00
Available On Air Stations
Get 2 limited-edition podcast mugs when you make a sustaining gift of $8 or more per month today!

Cuba To Phase Out Two-Peso Currency System

A woman displays Cuban pesos, or CUP (right) and the more valuable convertible pesos, or CUC (left), in Havana Tuesday. Raul Castro's government announced that it will begin unifying the two currencies.
AFP
/
AFP/Getty Images
A woman displays Cuban pesos, or CUP (right) and the more valuable convertible pesos, or CUC (left), in Havana Tuesday. Raul Castro's government announced that it will begin unifying the two currencies.

Cuba will end the two-currency system it has used for nearly 20 years. Since the collapse of the Soviet Union, Cuba has used either American currency or a peso that's pegged to the dollar alongside its national peso.

The monetary unification will phase out a system that has become a symbol of exclusivity and foreign wealth. Many products that are imported into the country can be bought only with the dollar-based convertible peso. But most Cubans are paid in the standard peso, which is worth just a fraction of the other currency.

"The policy exacerbated the creation of a two-tier class system in Cuba which divided privileged Cubans with access to the lucrative tourist and foreign-trade sectors from those working in the local economy," the BBC reports, "all-too-visibly contradicting Cuba's supposedly egalitarian society."

Cuba's Central Bank says it will continue to back both the convertible peso, or CUC, and the Cuban peso, or CUP, when it begins the process of unifying the two currencies. The bank says the change will make it easier to calculate labor costs and other statistics, along with making Cuba's economic system more efficient.

No dates have been released for the plan, which has the backing of President Raul Castro. The change was announced in an official guideline published in the Communist state's Granma newspaper.

Copyright 2021 NPR. To see more, visit https://www.npr.org.

Bill Chappell is a writer and editor on the News Desk in the heart of NPR's newsroom in Washington, D.C.

You make NHPR possible.

NHPR is nonprofit and independent. We rely on readers like you to support the local, national, and international coverage on this website. Your support makes this news available to everyone.

Give today. A monthly donation of $5 makes a real difference.