Cuba steps back from its wholesale produce monopoly

HAVANA, June 20 Thu Jun 20, 2013 6:08pm EDT

HAVANA, June 20 (Reuters) - A wholesale produce market run by a private cooperative will open on July 1 in Havana, the first such market since Cuba monopolized wholesale operations in the 1960s, state media said on Thursday.

"The opening of this wholesale market is part of a new system of produce sales ... in Havana, and (neighboring) Artemisa and Mayabeque (provinces)," the government's mid-day newscast said, adding three others would follow in the capital.

The state will own the premises, but the market will be leased to a cooperative that will operate it "on the basis of supply and demand," the report said.

The private cooperative will be the first to operate in Cuba outside of farming and is one of some 200 privately run wholesale markets of all types set to open in the coming months.

They will range from food services and construction to transportation and shrimp breeding.

President Raul Castro, who replaced his ailing brother Fidel in 2008, began agricultural reforms a year later as part of a broad effort to modernize the Soviet-style economy.

With the country importing around 60 percent of its food and private farms outperforming state farms on a fraction of the land, authorities are gradually deregulating the sector and leasing fallow land to would-be farmers.

At the same time, the state is licensing private truckers and vendors as part of an opening to small businesses. Some 400,000 people now work in what is called the "non-state" sector.

The government has said it will hold on to medium-sized establishments or lease them to privately run cooperatives free of state control and setting of prices, which it views as preferable to businesses owned by individuals.

Cuban farmers and consumers have long complained that the state's monopoly on food sales is a disincentive to production, inefficient and leads to waste and poor quality produce.

"Something has to be done, at least they are trying to solve the problem," Camaguey province farmer Anibal Martinez said in a telephone interview.

"No doubt it's not perfect, but hopefully they will fix whatever difficulties arise," he said. (Reporting by Marc Frank; Editing by Xavier Briand)

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