HAVANA, Cuba — A delegation representing American credit unions toured this country and met with officials regarding launching credit unions in Cuba.
The World Council of Credit Unions said that credit unions’ cooperative nature and updates in the Cuban government’s approach to its own social and financial policies may open the door for credit unions in the socialist Caribbean country. WOCCU added, however, that definitive moves in the potential establishment of the island nation’s first member-owned financial cooperatives are still some months off.
Credit unions’ viability will be determined not only by an increased receptivity and application by Cuba’s banking and government sectors, but also through continued efforts toward the overall normalization of the political relationship between the United States and Cuba, according to findings of a credit union study group that visited the island.
“Credit unions have a definite capacity for serving the Cuban people, especially in rural areas,” said World Council of Credit Union President and CEO Brian Branch, who led the group that visited Havana Oct. 12–14. “Our mission is one of ‘people helping people,’ and when the time is right, the global movement will be ready to lend the technical assistance necessary if Cuba decides to move in that direction.”
The study group visit, arranged by former CUNA CEO Dan Mica and his firm, The DMA Group, included CUNA President and CEO Jim Nussle and his wife, Karen Nussle, executive director for the Collaborative for Student Success; League of Southeastern Credit Unions & Affiliates President and CEO Patrick La Pine; California and Nevada Credit Union Leagues President and CEO Diana Dykstra; Montana Credit Union Network President and CEO Tracie Kenyon; Eddie Black, president and CEO of Trio Community Federal Credit Union, Helena, Mt.; John Neusaenger, president and CEO of Orlando Federal Credit Union, Orlando, Fla.; and Michael Ostrowski, president and CEO of Arrha Credit Union, Springfield, Massachusetts.
Branch and Victor Corro, World Council vice president of member services, represented the Madison, Wis.-based international credit union trade group. Mica Group principals Dan Mica and Paul Mica organized the fact-finding mission.
“We saw first-hand that the need for credit unions is overwhelming,” Dan Mica said in a statement distributed by World Council. “We found a population we believe is highly supportive of those services.”
CUNA’s Nussle agreed. “It’s fascinating to be on the leading edge of a relationship with a neighbor like Cuba,” he said. “Their thinking is profoundly different than ours politically in relation to things we hold dear, but that’s not something that can’t be overcome.”
Changes to the Cuban economy began in earnest in 2011, when the government began to spin out certain employment sectors to reduce the strain on its overall budget. Business cooperatives, particularly in the agricultural and small production and services sectors, began to form with the government’s blessing, assuming cooperative or private ownership of enterprises that were once run by the state.
Currently, there are no member-owned financial cooperatives among that group.
Formation of Cooperatives One Government Goal
As CUToday.info reported earlier, Branch first visited Cuba in July to discuss the possibilities of credit unions. Meetings with Cuban academic economists after the economic change led him to believe there might be a place for member-owned financial cooperatives in Cuba’s future.
The creation of cooperatives was just one of the economic reforms introduced by government officials according to Dr. Antonio F. Romero Gomez, an economics professor from the University of Havana who addressed the credit union study group.
The government’s goal, Gomez said, was to this year raise non-state cooperative and private sector employment to 50%, a group who would then generate 40% of Cuba’s gross domestic product. So far, the goal has not been met, the academic added.
“This latest visit focused on exploring opportunities that dovetail with the economic goals of the Cuban government, while at the same time helping them best serve the economic needs of their people,” Branch said. “We established a dialogue and introduced to them the possible solutions that Cuban credit unions could provide.”
In addition to meeting with the University of Havana official, the group also met with Gustavo Machín Gómez, sub-director general for the Republic of Cuba Ministry of Exterior Relations. The Cuban government official expressed interest in working more closely with the U.S. despite political challenges still facing the two countries’ governments.
What we cannot forgive is trying to do something that doesn’t benefit the majority of the people,” Gomez told the group. “The political window has not been open that long, but I know that both countries are committed to making this process work.”
The group also met with officials from the Central Bank of Cuba to discuss how credit unions might fit into the overall financial services sector. The Central Bank, created in 1997, leads a financial services industry that includes nine state-owned commercial banks, representative offices from four foreign banks, and 11 nonbank entities, the list of which includes investment and insurance enterprises but no member-owned financial cooperatives.
The Central Bank already has been exploring ways to better serve Cuban citizens, according to Irma Martinez Castrillon, the bank’s vice president. “Financial services are the concern of the state sector, and we have been involved in perfecting the system at the national level. We would have to proceed step by step and study the results of each experience,” Castrillon told the group.
The group concluded its visit with a briefing at the newly reopened American Embassy in Havana led by Dana Brown, the embassy’s political and economic chief. Brown was interested in the findings gathered by the group, as well as the advantages Cuban credit unions would bring to the country’s people.
Further steps need to be taken in both the government and financial sectors before any type of credit union development program is established, Branch said. But the seeds have been planted and the study group’s participants are hoping for a bountiful result.
“I think this was an excellent trip,” Mica said.
For info: www.creditunionsforcuba.org.