Are you feeling the pinch of inflation at home? How does 500% inflation sound? That's the rate some independent experts recently identified in Cuba, where the unofficial market for dollars is booming in response to a plummeting peso.
With the dollar stronger than ever, U.S. travelers ask: is now the perfect time to travel to Cuba?
A Challenging Few Years
With a near-total pandemic closure to tourism drying up one of the nation's most essential industries in just a few fateful weeks, Cuba's economic outlook was already bleak after 2020. Fiscal reforms at the start of 2021 unified the country's dual currency system, a lingering remnant of the days following the collapse of the Soviet Union.
But reforms did not go as planned. As government-run stores selling essential goods in foreign currencies opened around the country, the value of the U.S. dollar, Euro, and other foreign currencies quickly roared past official exchange rates pegged at 24 pesos to the dollar. Unofficial rates in the streets of Havana by the end of the year reached upwards of 100 pesos to the dollar.
It has come at a high cost to Cubans. Lines to purchase essential goods can stretch for hours, and more Cubans are leaving the island than in the Mariel Boatlift of 1980 and the Balsero crisis of 1994 – combined. For U.S. citizens contemplating a trip to the island, weighing the travel benefits of an ever-strengthening dollar with the uncertainty of Cuba's outlook makes for a confusing challenge.
Legal Travel to Cuba for U.S. Citizens
But is travel to Cuba from the United States legal? Surprise! Despite long-held beliefs that Cuba is off limits to U.S. citizens, it's been relatively easy to travel to Cuba since President Obama overhauled U.S. policy towards Cuba in late 2014.
While U.S. citizens technically cannot legally travel to Cuba for tourism, Obama-era changes allowed for “Support for the Cuban People” travel to Cuba. It is, essentially, tourism with a caveat. Don't spend money with the Cuban government. Instead, support Cuban small business owners rather than hotel or restaurant conglomerates that the Cuban government oversees.
While the Trump administration further tweaked U.S. travel policy to Cuba, it generated more splashy headlines than substantive change. U.S. citizens can still travel to Cuba. No stuffy, boring group tour is required. Legal travel to Cuba from the U.S. is no more challenging than booking a ticket and catching a flight.
Cash Is King
The booming dollar creates a unique opportunity for U.S. travelers, whose travel dollars can go a long way in a country that is still a long way from reaching pre-pandemic levels of tourism. However, taking advantage of the strong dollar is more challenging than you may think.
The more than sixty-year-long U.S. embargo on Cuba means that U.S. travelers can't access funds in Cuba: you have to bring cash. Plan to change money with unofficial money changers rather than using official CADECA exchange houses, and you'll get almost double the number of pesos.
Staying Informed
Bringing plenty of cash to Cuba is just one of the travel adjustments to consider as you plan a trip to Cuba. With the shuttering of Western Union and similar services for sending money in 2020, it's harder than ever to send money to Cuba; it's crucial travelers don't get caught without enough to cover their stay.
While travelers won't feel much of the impact of inflation and the economic instability of Cuba, it's more important than ever to travel informed. With recent gas shortages causing lines at gas stations to stretch on for hours, you may have to reconsider renting a car to explore the island.
A Tempered Rebound
Travelers headed to Cuba in the upcoming high season of travel benefit from increased purchasing power as well as a marked decrease in the swelling pre-pandemic tourism numbers. While the visitor count rises month over month, tourism arrivals are still just half of what they were in 2019.
Is Now The Time?
If you're looking to enjoy the white sand beaches, historic neighborhoods, and lush tropical jungles of Cuba without countless tourists on all sides, now is a great time to visit Cuba. Despite its reduced visitor count, Cuba has just as much to offer travelers as it did pre-pandemic and pre-inflation.
For travelers concerned about visiting Cuba during such challenging times for the Cuban people, remember this: your travel dollar is needed more than ever for small business owners. Owners of rental apartments, cafes, shops, and private tour companies are clawing their way through this rough patch, and now more than ever, every dollar makes a difference.
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This article was produced by Home to Havana and syndicated by Wealth of Geeks.
source https://wealthofgeeks.com/currency-in-cuba/
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