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10/31/04 - CASTRO BANS U.S. DOLLARS IN CUBA - 2004-11-01

Beginning November 8th, Cubans and visitors to the country will no longer be allowed to use U.S. dollars for transactions. This means that Cubans who want to spend the U.S. dollars they hold will have to exchange them for so-called "convertible" pesos, which have no value outside Cuba. Each exchange includes a ten percent commission, which goes to the Cuban government.

U.S. State Department deputy spokesman Adam Ereli says Cuba's effort to ban the circulation of dollars underscores the weakness of the Communist government of Fidel Castro:

"We think that this move is yet another indicator that Castro is refusing to do what's best for his own people. It shows that he's cynically trying to preserve a bankrupt regime at his people's expense. We see it as a confiscatory measure. When they prevent their people from spending dollars and require them to exchange them for a ten percent commission, that's pretty draconian." Following the collapse of the Soviet Union and the loss of subsidies from Moscow, Castro legalized the use of U.S. currency in Cuba. Castro's strategy is to prop up his regime by obtaining additional income, especially through tourism. It is also estimated that Cuban-Americans send as much as one billion U.S. dollars annually to their relatives in Cuba.

The currency conversion fees Castro will squeeze from Cuban citizens and tourists will generate a sizable windfall for the Cuban government. Fidel Castro will use that windfall to try to maintain one of the world’s most repressive regimes.

Yet despite decades of suppression, degradation, and deprivation, the Cuban people's aspiration for change continues to grow. Brave Cubans continue to defy the regime and insist that it recognize fundamental rights. In the words of President George W. Bush, "Cuban courage is more powerful and enduring than Castro's legacy and tyranny. All our citizens are proud to stand with all Cubans who love freedom. We will continue to stand with them until that day, hopefully not in the too-distant future, when all Cubans breathe the heady air of liberty."