Economic Development

Towards Economic Development – MSMEs on the Rise

The private sector will contribute to economic development in many ways.

As the number of micro, small and medium-sized enterprises (MSMEs) grows in Cuba, so will the benefits this dynamic sector can bring to economic development.

Since the beginning of the MSMEs’ application process in September 2021, the total number of approvals has reached 2,986 enterprises. Of those approved by the Ministry of Economy and Planning (MEP) last week, 116 are private businesses, and four are non-agricultural cooperatives.

The MEP reported that 56% of these are re-conversions of existing businesses and 44% are new ventures.

There are many benefits for a nation’s economy that come from the expansion of the private sector. Job creation is one of the most obvious. The total number of approvals is predicted to reach 48,384 new jobs for the economy.

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As an engine for economic growth, the private sector can also play a part in a nation’s sustainable development goals, in which creativity and innovation, infrastructure development, and increased “connectivity” between people and businesses and business-to-business takes place.

Expansion of import and export activity is another positive result, boosting the trade figures. The number of signed contracts between the state companies (the service providers), with the non-state sector increased.

Local economic development has not been left out in the equation. Of the total MSMEs approved, 109 are local development projects, and 35 of these have already carried out export business.

Eleven of the recent approvals have been launched in the Science and Technology Park of Havana, a factor that boosts research and development initiatives, knowledge sharing, and technology transfer.

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And while 36% of companies in Latin America struggle to find properly trained staff, this is one factor that Cuba, with its well-educated and trained population, can expect to avoid.

The new approvals signify the crucial role the private sector plays in Cuba’s economic development.

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