Double Currency Causes Headaches for Cubans

The Saint Francis of Assisi Cathedral in Old Havana has a majestic bell tower that rises high above the city. For two Cuban convertible pesos, or CUCs, roughly $2, tourists can wander many of its hallways and climb—carefully—up several old, narrow staircases to peer down at San Francisco Square and across to the capitol building. I'm never one to refuse a view, so I pulled a $10 CUC bill out of my wallet to enter the now-museum.

"No, no, no," the cashier said, exasperated, as if I had personally insulted her. "Mas pequeno, mas pequeno! Too big!"

It wasn't the first time a "large" bill had been refused during my visit to Cuba, and it wouldn't be the last, either. Even in touristy Old Havana, where the vast majority of goods and services are catered specifically to people who are only in town temporarily, currency problems can cause major headaches.

But it can be even worse for Cuban citizens. One CUC (which is roughly equivalent to $1 USD) equals 24 Cuban pesos. The Cuban peso, CUP, is the national currency of Cuba, and it's the form in which most people receive their salaries. It's mostly accurate to say that CUCs are the currency of tourists, but that's not the whole story.

The CUC was established in the 1990s to replace US dollars as tourists' currency of choice. Visitors from developed nations will find that their money goes very far in Havana, once they've converted it into CUCs. At one fancy-looking hotel restaurant, it cost about CUC $8 for three good-sized plates of tapas, one daiquiri, one soda, tax and tip. A massive, four-scoop ice cream sundae with fruit, caramel and other toppings cost about CUC $2.50—and this is all in the area where prices are marked up.

Most Cubans are paid in CUPs, but there are some items, like milk and shampoo, that must be purchased with CUC. At first glance, it seems like the convertible peso is just a large denomination. Items priced in Cuban pesos can be purchased with convertibles and vice versa, but the difference in buying power is so significant that it can be confusing to make change, not to mention that street vendors selling CUP $3 pastries hardly carry enough cash to make change for anything much larger than a CUC $1 bill. A CUC $3 note, the second-smallest denomination, is worth CUP $72. With that, a tourist could buy 24 pastries—probably at least a quarter of the lot vendors carry in clear plastic boxes strapped to the backs of their bicycles.

The currency exchange is not exactly even. CUC $1 will yield CUP $24, but it takes CUP $25 to purchase one CUC. For Cubans, this means long lines outside change houses to convert Cuban money into another kind of Cuban money.

Citizens have a great deal of nationalistic pride in being Cuban, and especially in being from Havana, but there are many aspects of the country that the vast majority of citizens will never get to enjoy. Despite the strict laws that keep foreign corporations from widely infiltrating Cuba, quite a bit is reserved for tourists and the wealthiest of the wealthy. Even though recent changes to travel laws have made it easier for citizens to legally leave and return to Cuba, few will be able to afford plane tickets.

For those with jobs in the tourism industry, life is a little easier. Even if the salaries are low, the tips are high and already converted to CUC. But for those who are paid entirely in CUP, it can be challenging or even impossible to save any money. If an individual with a $20 monthly salary put aside 20 percent of his or her wages, it would take more than six years to collect enough for a single $300 plane ticket to Miami. And that's just one way.