The enclosed Report entitled ZENITH AND ECLIPSE: A COMPARATIVE LOOK AT SOCIO-ECONOMIC CONDITIONS IN PRE-CASTRO AND PRESENT DAY CUBA, published by Bureau of Inter-American Affairs, February 9, 1998, portrays Cuba's regional and international standing in years 1958 and 1996.  It may be seen that by 1958 - with only 56 years as a free nation, starting from scratch in 1902 in the wake of the War of Independence - Cuba had risen to a top position within Latin America, even surpassing some European countries.

        In contrast, social and economic indicators in 1996 clearly show widespread stagnation, even decreases in some parameters.  Its relative ranking worldwide has plummeted to the lowest place in Latin America in various instances, akin the poorest African nations.
 

                                    Jose Lopez Silvero                    Alfredo Blanco, Jr.
                                          President                                        VP

SUMMARY AND INTRODUCTION

        An enduring myth is that 1950's Cuba was a socially and economically backward country whose development was jump-started by the Castro government.  In fact, according to readily-available historical data, Cuba was a relatively advanced country in 1958, certainly by Latin American standards and, in some areas, by world standards.  The data appear to show that Cuba has at best maintained what were already high levels of development in health and education, but at an extraordinary cost to the overall welfare of the Cuban people.  These include access to "basics" such as adequate levels of food and electricity, but also access to consumer goods, the availability of which have increased significantly in other Latin American countries in recent decades.

        It is true that Cuba's infant mortality rate is the best in Latin America today, but it also was the best in Latin America -- and the 13th lowest in the world -- in pre-Castro Cuba.  Cuba also has improved the literacy of its people, but Cuba had an excellent educational system and impressive literacy rates in the 1950's.

        On the other hand, many economic and social indicators have declined since the 1959 revolution.  Pre-Castro Cuba ranked third in Latin America in per capita food consumption; today, it ranks last.  Per capita consumption of cereals, tubers, and meat are today all below 1950's levels.  The number of automobiles in Cuba has fallen since the 1950's - the only country in Latin America for which this is the case.  The number of telephone lines in Cuba also has been virtually frozen at 1950's levels.  Cuba once ranked first in Latin America and fifth in the world in television sets per capita.  Today, it barely ranks fourth in Latin America and is well back in the ranks globally.

        Cuba's rate of development of electrical power since the 1950's ranks behind every other country in Latin America except Haiti.  Cuba is the only country in the hemisphere for which rice production today is lower than it was four decades ago.  By virtually any measure of macroeconomic stability, Cuba was in far better shape in 1958 than it is today.  Finally, the Castro government shut down what was a remarkably vibrant media sector in the 1950's, when the relatively small country had 58 daily newspapers of differing political hues and ranked eighth in the world in number of radio stations.

METHODOLOGY

        This paper assesses Cuba's level of development in a variety of economic and social indicators during the revolutionary period (1959-present), especially relative to that of other countries during the same period. It relies most extensively on UN data, particularly from the statistical yearbook and demographic yearbook, which are considered among the most prestigious data compendiums in the development field.  Trade data is derived from the IMF's Direction of Trade Statistics, which provides a consistent data series dating back to the l950s.  For the various international comparisons and rankings listed below, only those countries acquiring independence prior to 1958 and having relatively consistent data available for the period 1955-present have been included. ( The former stipulation excludes many highly-developed Caribbean countries from consideration).

HEALTH

        The health care system is often touted by many analysts as one of the Castro government's greatest achievements. What this, analysis ignores is that the revolutionary government inherited an already-advanced health sector when it took power in 1959.

        Cuba's infant mortality rate of 32 per 1,000 live births in 1957 was the lowest in Latin America and the 13th lowest in the world, according to UN data.  Cuba ranked ahead of France, Belgium, West Germany, Israel, Japan, Austria, Spain, and Portugal, all of which would eventually pass Cuba in this indicator during the following decades.

        Today, Cuba remains the most advanced country in the region in this measure, but its world ranking has fallen from 13th to 24th during the Castro era, according to UN data.  Also missing from the conventional analysis of Cuba's infant mortality rates is its staggering abortion rate -0.71 abortions per live birth in 1991, according to UN data – which, because of selective termination of "high-risk" pregnancies, yields lower numbers for infant mortality.  Cuba's abortion rate is at least twice the rate for the other countries in the table below for which data is available.

        In terms of physicians and dentists per capita, Cuba in 1957 ranked third in Latin America, behind only Uruguay and Argentina - both of which were more advanced than the United States in this measure. Cuba’s 128 physicians and dentists per 100,000 people in 1957 was the same as the Netherlands, and ahead of the United Kingdom (122 per 100,000 people) and Finland (96).

        Unfortunately, the UN statistical yearbook no longer publishes these statistics, so more recent comparisons are not possible, but it is completely erroneous to characterize pre-Revolutionary Cuba as backward in terms of health care.

WORLD: INFANT MORTALITY
(DEATHS PER 1,000 LIVE BIRTHS)

SOURCE: UNITED NATIONS.

EDUCATION

        Cuba has been among the most literate countries in Latin America since well before the Castro revolution, when it ranked fourth.  Since then, Cuba his increased its literacy rate from 76 to 96 percent, which today places it second only to Argentina in Latin America.  This improvement is impressive, but not unique among Latin American countries.  Panama, which ranked just behind Cuba in this indicator during the 1950's - has matched Cuba's improvement when measured in percentage terms.

LATIN AMERICA: LITERACY RATES (A)
(PERCENT)

(1995 Data is the latest available)
 

(A) Data for 1950-53 are age 10 and over.  Data for 1995 are age 15 and over, reflecting a change in common usage over this period.
(B) 1947 data, the latest available, are for age 14 and over.

SOURCE: UNITED NATIONS.

CONSUMPTION

        Rationing has been a staple of Cuban life since the early 1960's.  During the early 1990’s Cuba's food consumption deteriorated sharply, when massive amounts of Soviet aid were withdrawn.  On its own without Soviet largesse and abundant food imports, Cuban agriculture was paralyzed by a scarcity of inputs and poor production incentives resulting from collectivism and the lack of appropriate price signals.  In pre-Castro Cuba, by contrast, food supplies were abundant  The 1960 UN Statistical yearbook ranked pre-Revolutionary Cuba third out of 11 Latin American countries in per capita daily caloric consumption  This was in spite of the fact that the latest available food consumption data for Cuba at the time was from 1948-49, almost a decade before the Latin American countries' data being used in the comparison.  Looking at the same group of 11 countries today, Cuba ranks last in per capita daily caloric consumption, according to the most recent data from the UN FAO.  Indeed, the data show Cuba with a poorer food supply situation than even Honduras.
 

LATIN AMERICA: PER CAPITA FOOD CONSUMPTION
(CALORIES PER DAY)

(1995 Data is the latest available)
 

	1954-57	1995
MEXICO	2420	3135
ARGENTINA	3100	3110
BRAZIL	2540	2834
URUGUAY	2960	2826
CHILE	2330	2769
COLOMBIA	2050	2758
PARAGUAY	2690	2560
VENEZUELA	1960	2442
ECUADOR	2130	2436
HONDURAS	2260	2359
CUBA	2730 (A)	2291

 
(A) FOR 1948-49.

SOURCE: UN FAO FOOD BALANCE SHEETS

        A closer look at some basic food groups reveals that Cubans now have less access to cereals, tubers and meats than they had in the late 1940s.  According to 1995 UN FAO data, Cuba's per capita supply of cereals has fallen from 106 kg per year in the late 1940s to 100 kg today, half a century later.  Per capita supply of tubers and roots show an even steeper decline, from 91 kg per year to 56 kg.  Meat supplies have fallen from 33kg per year to 23 kg per year, measured on a per capita basis.

        Although some would blame Cuba's food problems on the U.S. embargo, the facts suggest that the food shortages are a function of an inefficient collectivized agricultural system - and scarcity of foreign exchange resulting from Castro's unwillingness to liberalize Cuba's economy, diversify its export base, and pay off debt owed to its Japanese, European, and Latin American trading partners during the years of abundant Soviet aid.  This foreign exchange shortage has severely limited Cuba's ability to purchase readily available food supplies from Canada, Latin America, and Europe.  The US Embargo has added, at most, relatively small increases in transportation  costs by forcing Cuba to import food from non - U.S. sources elsewhere in the hemisphere.

        The statistics on the consumption of nonfood items tell a similar story.  The number of automobiles in Cuba per capita has actually fallen since the 1950's, the only country in the hemisphere for which this is the case.  (Unfortunately, the last available data for Cuba are from l988.)  UN data show that the number of automobiles per capita in Cuba declined slightly between 1958 and 1988, whereas virtually every other country in the region with the possible exception of Nicaragua - experienced very significant increases in this indicator.  Within Latin America, Cuba ranked second only to Venezuela in 1958, but by 1988 had dropped to ninth.

        The 1988 data on automobiles also reveal that countries in Asia and Europe that once ranked far behind Cuba in this measure have since surpassed Cuba by a wide margin.  Japan, with four cars per 1,000 inhabitants in1958, was far behind Cuba(24) that year, but by 1988, Japan’s number had grown to 25l, whereas the figure for Cuba remained frozen at its 1958 level.  Similar comments could be made for Portugal (increased from 15 in 1958 to 216 in 1988), Spain (increased from six to 278), and Greece (increased from four to 150). Indeed, Italy’s 29 cars per capita was not far ahead of Cuba's 24 in 1958 but by 1988, Italy boasted 440 cars per capita, whereas the figure for Cuba was unchanged from the 1950's.

LATIN AMERICA. PASSENGER CARS PER CAPITA (A)
(CARS PER 1,000 INHABITANTS)
 
(1995 Data is the latest available)
 

	1958	1995	Average Growth, (Annual %)
ARGENITINA	19	129	6.6
URUGUAY	22 (F)	114	5.3
VENEZUELA	27	94	4.3
BRAZIL	7	73	8.1
MEXICO	11 (C)	70	6.4
PANAMA	16 (B)	56	4.3
CHILE	7	52	6.9
COSTA RICA	13	47 (C)	4.4
CUBA	24	23	-0.1
DOMINICAN REPUBLIC	3 (B)	23 (G)	7.3
COLOMBIA	6	21 (D)	4.3
PARAGUAY	3 (C)	20	6.5
PERU	7 (E)	18	3.1
ECUADOR	2	15	7.0
BOLIVIA	3 (C)	12	4.7
GUATEMALA	6	11	2.0
EL SALVADOR	7	10	1.2
NICARAGUA	7 (B)	8	0.5
HONDURAS	3	6	2.3

(A) - FOR MOST COUNTRIES, EXCLUDES POLICE AND MILITARY CARS.
(B) - EXCLUDES ALL GOVERN~IENT CARS.
(C) - INCLUDES POLICE CARS.
(D) - INCLUDES CARS NO LONGER IN US~
(E) - 1957.
(F) - 1956.
(G)- 1987.

SOURCE: UNITED NATIONS.

        Telephones are another case in point.  While every other country in the region has seen its teledensity increase at least twofold - and most have seen even greater improvements - Cuba's has remained frozen at 1958 levels  Today, Cuba has only 3 telephone lines per 100 people, placing it 14th out of 20 Latin American countries surveyed in 1994 and far behind countries that were less advanced than Cuba in this measure in 1958, such as Argentina (today 14 lines per 100 inhabitants), Costa Rica (13), Panama (11), Chile (11), VenezueIa (11), and several others.

        Cuba also has not kept pace with the rest of Latin America in terms of radios per capita.  During the late 1950s, Cuba ranked second only to Uruguay in Latin America, with 169 radios per 1,000 people.  (Worldwide, this put Cuba just ahead of Japan)  At that time, Argentina and Cuba were very similar in terms of this measure.  Since then, the number of radios per capita in Argentina has grown three times as fast as in Cuba.  Cuba also has been surpassed by Bolivia, Venezuela, El Salvador, Honduras, and Brazil in this indicator.  Today, Cuba ranks just above average for Latin American countries.

        In terms of television sets per capita, 1950’s Cuba was far ahead of the rest of Latin America and was among the world’s leaders.  Cuba had 45 television sets per 1,000 inhabitants in 1957, by far the most in Latin America and fifth in the world, behind only Monaco, the United States, Canada and the United Kingdom.  In fact, its closest competitor in Latin America was Venezuela, which had only 16 television sets per 1,000 people.  Today, Cuba has 170 televisions per thousand, behind Uruguay (232 per capita), Argentina (220), and Brazil (209).  Of these three countries, Uruguay in 1957 had fewer than one television per 1,000 people, and Argentina and Brazil each had five per 1,000 people - far behind Cuba's 45 per capita.

PRODUCTION

        Post 1959 Cuba falls short in areas of industrial production once prioritized by Soviet client states, such as electricity production.  Although Cuba has never been a regional leader in public electricity production per capita, its relative ranking among 20 Latin American countries has fallen from eighth to 11th during the Castro era.  In fact, in terms of rate of growth for this measure, Cuba ranks l9th of 20 countries in the region, with only Haiti showing less accelerated development.

        Cuba is the only country in Latin America whose production of rice has faIIen since 1958, when it ranked fourth in the region in production of this staple.  Two of the countries ranking ahead of Cuba in rice production in 1958- Colombia and Peru - have since seen their rice production grow by more than three fold.  Cuba's Caribbean neighbor, the Dominican Republic, has increased its production by four fold since 1958.  Perhaps even more telling are Cuba's yields per hectare in rice production.  Whereas the Dominican Republic has increased rice yields from 2100 kg per hectare in 1958 to 5400 kg per hectare in 1996, Cuba's yields today are only 2500 kg per hectare, a negligible increase from the 2400 kg per hectare registered in 1958, according to UN FAO data.

LATIN AMERICA: RICE PRODUCTION (1,000 MT)

 

	1958	1996	Average Growth (Annual %)
BRAZIL	3,829	10,035	2.6
COLOMBIA	378	1,787	4.2
ECUADOR	176	1,346	5.5
PERU	285	1,203	3.9
ARGENTINA	217	974	4.0
URUGUAY	58	868	7.4
VENEZUELA	22	733	9.7
DOMINICAN REPUBLIC	99	555	4.6
MEXICO	240	455	1.7
BOLIVIA	11	296	9.1
PANAMA	86	230	2.6
CUBA	261	223	-0.4
NICARAGUA	33	219	5.1
COSTA RICA	34	186	4.6
CHILE	102	154	1.1
PARAGUAY	20	119	4.8
HAITI	42 (A)	96	2.3
ELSALVADOR	27	51	1.7
HONDURAS	21	41	1.8
GUATEMALA	11	33	2.9

 
(A) - 1959.

SOURCE: FAO YEARBOOK (UN)

FOREIGN TRADE AND BALANCE OF PAYMENTS

        Cuba's exports have not kept pace with other countries of the region.  Of the 20 countries in the region for which comparable IMF data is available, Cuba ranks last in terms of export growth - below even Haiti. Mexico and Cuba had virtually identical export levels in 1958- while Mexico's population was five times Cuba's.  Since then, Cuba’s exports have merely doubled while Mexico's have increased by almost 130-fold, according to IMF statistics.  Cuba's exports in 1958 far exceeded those of Chile and Colombia, countries which have since left Cuba behind.  The lack of diversification of Cuba's exports over the past 35years also is remarkable, when compared with other countries in the region.

        Cuba's enviable productive base during the 1950’s was strengthened by sizable inflows of foreign direct investment.  As of 1958, the value of U.S. foreign direct investment in Cuba was $861 million, according to United States government figures published in 1959.  Adjusting for inflation, that foreign investment number amounts to more than USD 4.3 billion in today's dollars.

        Contrary to popular perception, U.S. investors were not focusing only on the sugar industry in the 1950's. U.S. firms began to gradually sell their Cuban sugar holdings to Cuban firms beginning in 1935.  By 1958, U.S. firms owned fewer than 40 of Cuba's 161 mills.  While U.S. firms were moving away from sugar, they were rapidly investing in a range of other ventures, especially in infrastructure development. According to U.S. government statistics, 41 percent of U.S. direct investments in Cuba were in utilities as of 1958.

LATIN AMERICA: TOTAL EXPORTS (MILLION USD)

 

	1958	1996	Average Growth (Annual %)
MEXICO	736	95,991	14
PANAMA	23	2,722	13
ECUADOR	95	5,243	11
COSTA RICA	92	3,286	10
CHILE	389	15,396	10
BRAZIL	1,243	47,747	10
PARAGUAY	34	1,282	10
HONDURAS	70	2,469	10
ARGENTINA	994	23,794	9
COLOMBIA	461	10,437	9
GUATEMALA	103	2,330	9
PERU	291	5,854	8
BOLIVIA	65	1,216	8
URUGUAY	139	2,397	8
VENEZUELA	2,319	23,149	6
EL SALVADOR	116	1,020	6
NICARAGUA	71	621	6
DOMINICAN REPUBLIC	136	886	5
HAITI	48	181	4
CUBA	732	1,831	2

SOURCE: IMF DIRECTION OF TRADE STATISTICS.

        As the numbers above imply, Cuba had a very favorable overall balance of payments situation during the 1950’s, contrasted with the tenuous situation today.  In 1958, Cuba had gold and foreign exchange reserves - a key measure of a healthy balance of payments - totaling $387 million in 1958 dollars, according to IMF statistics (that level of reserves would be worth more than 1.9 billion USD in today's dollars.)  Cuba's reserves were third in Latin America, behind only Venezuela and Brazil, which was impressive for a small economy with a population of fewer than 7 million people.  Unfortunately, Cuba no longer publishes information on its foreign exchange and gold reserves.

MASS MEDIA

        It is no exaggeration to state that during the 1950’s, the Cuban people were among the most informed in the world, living in an uncharacteristically large media market for such a small country.  Cubans had a choice of 58 daily newspapers during the late 1950’s, according to the UN statistical yearbook.  Despite its small size, this placed Cuba behind only Brazil, Argentina, and Mexico in the region.  By 1992 government controls had reduced the number of dailies to only 17.

        There has also been a reduction in the number of radio and television broadcasting stations, although the UN no longer reports these statistics.  However, it should be noted that in 1957, Cuba had more television stations (23) than any other country in Latin America, easily outdistancing larger countries such as Mexico (12 television stations) and Venezuela (10).  It also led Latin America and ranked eighth in the world in number of radio stations (160), ahead of such countries as Austria (83 radio stations). United Kingdom (62), and France (50), according to the UN statistical yearbook.
 
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