Cubans stock up as reforms take toll on ration

HAVANA (Reuters) - A steady stream of Cubans bought soap and toothpaste at subsidized prices on Thursday ahead of the latest cut in monthly rations that the communist state has provided since the 1960s but is phasing out in the name of economic reform.

Government stores around the capital stayed busy as customers handed over their ration cards, or "libretas," paid a few Cuban pesos and walked out with a bagful of items that will cost many times more starting on Saturday.

"We Cubans are survivors. Nobody is going to stop bathing because they raise the price of soap," said Rosa Martinez, 70, at the store La Copa in Havana.

The government said on Wednesday it would cut soap, toothpaste and detergent from the food and consumer products ration as it tries to save money and wean its citizens from handouts.

President Raul Castro is trying to pull the communist-run country out of chronic economic problems by reducing state spending, increasing productivity and expanding the private sector.

He has pledged to slash hundreds of thousands of jobs from government payrolls while allowing more self-employment.

The ration was begun three years after Fidel Castro took power in a 1959 revolution to assure Cubans food following the imposition of a trade embargo by the United States. But it has been a favorite target of his brother Raul, who says it costs too much and encourages sloth and corruption.

Raul Castro, who assumed power in Cuba when Fidel fell ill in 2006, has been whittling away at the ration since last year, previously removing items such as peas, potatoes and cigarettes. It is given to all Cubans but eventually will be provided only to those in need, Castro has said.

BLOW TO POCKETBOOKS

The libreta still covers rice, beans, sugar, coffee, eggs, salt and small quantities of meat and while the latest cuts are not a surprise, they are another sign of fading government paternalism and another blow to Cubans' pocketbooks.

"The libreta doesn't get much but it gives security to know that at least you have part of what you need guaranteed," said Isabel Lopez, 44.

Cubans receive free or subsidized social benefits but earn on average about 450 pesos a month, the equivalent of $20.

In a rustic government store near Havana's Revolution Square, handwritten signs showed prices for soap and toothpaste that ranged between 20 Cuban cents (less than one U.S. cent) and 65 Cuban cents (three U.S. cents).

On Saturday, they will be sold at fixed prices starting at five Cuban pesos, which is about 22 U.S. cents.

Some customers, worried about how they will buy the items in the future, and said they will do without if necessary.

"We'll buy them when it's possible and when it's not, nothing will be bought," said Paula Santavenia, who said she gets a monthly retirement check of 200 pesos, or $9.

Rosa Martinez remembered that Cubans made their own soap from aloe vera and caustic soda during the severe economic crisis of the 1990s but did not think the situation will get that bad now.

"These people are not crazy. The government knows what it is doing," she said.

Office worker Carlos Terrazas was less certain.

"The government says it is making changes but nothing ever changes here," he said. "All that happens is we have less and less."

(Additional reporting by Rosa Tania Valdes; Editing by Bill Trott)