Dec. 19 (Bloomberg) -- Cuba’s government said it will make it easier for residents to sell their 1950s-era Chevrolets, Cadillacs and other used cars within the communist island.
“After several months of study, it was decided to eliminate the existing measures requiring state approval of the sale of vehicles,” according to a statement today in state-run newspaper Granma that cited the ruling Council of Ministers.
A U.S. trade embargo first put in place on Cuba in 1962 after Fidel Castro came to power has helped keep the Caribbean island’s auto market frozen in time, with models like the fin-tailed Chevy Bel-Air and Cadillac Coupe de Ville often used as taxis outside tourist hotels. Few Cubans own cars, relying on decaying public transport the government says needs to improve.
President Raul Castro, who officially succeeded his brother Fidel in 2008, has moved to ease some travel restrictions as well as allow more cooperatives and private businesses to operate in the $61 billion economy. The country depends on about 100,000 barrels per day of subsidized Venezuelan oil to sustain the economy, while a vow by 82-year-old Castro to dismiss 500,000 state workers hasn’t been carried out.
The government said about 30 percent of autos sold with government approval last year were quickly re-sold, indicating that the system was causing “speculation and enrichment.”
The new measures, which will be implemented “gradually,” will set a minimum price for auto sales, which the government can tax to help pay for better public transport. The government said it will maintain the requirement for approval to import new and used cars.
A partial U.S. embargo on the island remains in place as the two governments cooperate in areas such as the fight against drug trafficking. Negotiations on a direct mail service re-started earlier this year. Raul Castro and U.S. President Barack Obama shook hands for the first time last week at a memorial service for late South African leader Nelson Mandela.
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