Cuba’s informal market finds new space on growing internet | Business

In the Telegram group chat, the news rolls in like waves.

“I need liquid ibuprofen and paracetamol please,” wrote one user. “It’s urgent, it’s for my 10-month-old baby.”

Others offer medicines brought in from outside Cuba, adding, “Drop me a direct message.” Lists sprinkled with emojis offer antibiotics, pregnancy tests, vitamins, rash creams and more.

The group embassy, ​​which numbers 170,000 people, is just one of many that have thrived in Cuba in recent years alongside an exponential increase in internet use on the island.

The informal sale of everything from eggs to car parts — the country’s so-called black market — is a time-honored practice in crisis-ridden Cuba, where access to the most basic commodities like milk, chicken, medicine and cleaning supplies has traditionally been limited. The market is technically illegal, but the level of illegality can vary from an official perspective depending on the type of items being sold and how they were acquired.

Before the Internet, such exchanges were “through your contacts, your neighbors, your local community,” said Ricardo Torres, a Cuban and economist at American University in Washington. “But now you can reach an entire province via the Internet.”

In the face of the worst shortages and economic turmoil in years, the online marketplace has “blown up,” Torres said.

Busy WhatsApp groups discuss the informal exchange rate, which offers more pesos per dollar or euro than the official bank rate.

Meanwhile, Cuba’s versions of Craigslist — sites like Revolico, the island’s first digital buying and selling tool — advertise everything from electric bicycles imported from other countries to “capitalist housing” in Havana’s affluent neighborhoods.

Many products are sold in pesos, but higher-priced items are often offered in dollars, with payments being accepted either in cash or by international bank transfer.

While wealthier Cubans — or those with families sending money from abroad — can afford more elaborate items, many basic items remain unaffordable for the likes of Leonardo, a government-employed engineer, who asked not to give his real name because he fears retaliation from the government .

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Three months ago Leonardo started buying items like inhalers, antibiotics and rash creams from friends who came from other countries and then reselling them online for a small profit. Government authorities harshly criticize such “revendedores,” or resellers, particularly those who buy products in Cuban stores and then sell them at a higher price.

At the end of October, President Miguel Díaz-Canel called for a crackdown on this practice, calling the Revendedores “criminals, scammers, scumbags, lazybones and corrupt”.

“What we cannot allow is that those who don’t work, don’t contribute and are breaking the law, earn more and have more opportunities to live well than those who actually contribute,” he said at a meeting with government officials. “If we did that… we would break the concepts of socialism.”

But Leonardo said he and others like him are just trying to get by.

“This drug is going to the people who need it, people with breathing problems,” he said. “Those who use them are people who really need them. … We mainly sell antibiotics.”

With the money he earns from his sales, Leonardo was able to buy soap and groceries, as well as antibiotics and vitamins for his elderly parents.

The rise of new digital marketplaces speaks to a particular kind of creative resilience that Cubans have developed during decades of economic turmoil. Much of the crisis is the result of the US government’s six-decade trade embargo on the island, but critics say it also stems from mismanagement of the economy and the government’s reluctance to involve the private sector.

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So the people of the island tend to be very resourceful and work with whatever they have at their disposal – think old cars from the 1950s that still roll through the streets thanks to mechanics who came up with ingenuity and spare parts Fix shortage of new vehicles.

Entrepreneurs have used the same creativity to deal with the initially very limited internet access. Carlos Javier Peña and Hiram Centelles, Cuban expatriates living in Spain, founded Revolico in 2007 to “alleviate the hardships of life in Cuba”.

They kept the site design simple, much like Craigslist, to accommodate the island’s sluggish internet. But in 2008, the same year the government lifted a ban on PC sales, it blocked access to Revolico. The ban remained in effect until 2016. Meanwhile, Peña and Centelles used digital tools and various host sites to bypass the firewall.

However, using the site was still a challenge for many due to the lack of mobile internet.

Heriberto, a university student in 2008, was able to access it through a small monthly internet package given to him by the school. Others asked friends and family to buy items for them at work, where they sometimes had Internet access.

“Here, the markets mostly don’t have the things you’re looking for,” said Heriberto, now 33, who asked that only his first name be used because he also feared backlash from the government. “It’s how you develop that habit of checking the store first. And if they don’t have it, look to Revolico.”

Sales on WhatsApp, Facebook and Telegram really took off in 2018 when Cubans gained internet access through their phones, something the American University’s Torres called a “game changer.”

Between 2000 and 2021, the number of Cubans using the internet increased from less than 1 percent of the population to 71 percent, data from the International Telecommunications Union shows. The internet has been a lifeline for Heriberto and many other Cubans during the COVID-19 pandemic, they said.

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Now that the island’s main industry, tourism, is still recovering, many entire businesses have built on the online sale of goods – both basic necessities such as medicines and many higher-priced specialty items. Heriberto recently used the site to sell a mountain bike that he had priced in dollars.

According to Revolico co-founder Centelles, the website and similar tools have evolved to adapt to an ever-changing Cuba. For example, as the island suffers from crippling power outages, sales of power generators and rechargeable batteries have skyrocketed, he said.

Government officials said the internet is important to the country’s economic growth — but treated it with “grudging acceptance,” said Valerie Wirtschaftser, a senior data analyst at the Brookings Institution that tracks internet use in Cuba.

“They were never really able to control the internet in many ways,” said Wirtschaftser.

Perhaps the most visible example was the eruption of mass protests in 2021, largely thanks to rapidly spreading communication on social media sites such as Facebook, WhatsApp, Instagram and Telegram. The government blocked many major social media and news sites for several days to prevent the protests from spreading.

While Leonardo said he thought selling on Telegram was risky, “in the end you need medication… so you take that risk.”

Heriberto still uses Revolico, but he said he now prefers sites like Facebook that offer a level of anonymity. On those sites, he can sell with a fake profile, he said, unlike Revolico, which requires you to provide your phone number.

“It’s a requirement now,” Heriberto said. “The Internet has arrived in Cuba and is now fundamental.”