Cuba announced it will halt the use of US dollars in all retail and commercial transactions beginning 8 November 2004, a significant reversal of the island's economic policy. The Cuban Central Bank delivered the announcement on national television, with leader Fidel Castro present for his first public appearance following knee surgery after a recent fall.
Under the new rules, hotels, restaurants, car rental agencies, and taxi drivers must accept only the convertible peso, a local currency with no international value. Cubans wishing to shop at stores that operate in foreign currency must exchange their dollars into convertible pesos at a one-to-one rate, subject to a 10 percent transaction tax. Other currencies, including the euro, Canadian dollar, pound sterling, and Swiss franc, remain accepted as before.
The government framed the move as a direct response to tighter US sanctions announced in June 2004, which restricted remittances and family travel between the two countries. Cuba has been under a US trade embargo for 43 years. The dollar had been permitted to circulate freely since 1993, when economic reforms were introduced following the Soviet Union's collapse. The convertible peso entered circulation in 1995.
The policy change was expected to affect Cubans with family members in Florida and elsewhere in the United States who had been sending financial support to relatives on the island.
Historical summary. TurkishPress restated this AFP wire report, first published in October 2004, in its own words.