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Why Cuba could be the next Silicon Valley (eventually)

Mike Elgan | March 22, 2016
Cuba is an Internet backwater, but I think its next revolution could be digital.

The president of the United States is in Cuba!

President Obama's trip is a big deal. It's the first time a U.S. president has visited Cuba since 1928.

Here in Cuba (where I'm living for a month), Obama's trip is the biggest and most historic of events. Everywhere in Havana, workers are frantically painting and fixing and cleaning.

We lounged until midnight Wednesday on the veranda of the Hotel Nacional de Cuba slurping mojitos, smoking Cohibas and listening to amazing live Cuban music. All the while workers never stopped painting the walls and sprucing things up.

The president is hugely popular here. The Cubans I talked to about Obama said they credit him for the most important changes they've seen in the past few years. Cubans believe that the visit is something Obama is doing for the Cuban people because his decision to come here forced the Cuban government to make concessions and liberalize the economy faster. Many Cubans credit Obama for the lifting, in 2009, of most of the bans on money transfers from Cuban-Americans to relatives in Cuba, and for the easing of restrictions on Cuban-Americans visiting the island. Since then, money has flowed into Cuba, creating a dual economy of haves and have-nots (either you have generous relatives in Miami, or you have not).

The biggest shock for first-time visitors to Cuba is the dilapidated state of the buildings. Most neighborhoods in Havana look like war zones -- war zones where zombie apocalypses transpired after the bombing stopped. I had previously visited Cuba in 2008, and today the buildings are in a far more advanced state of decay than they were then. But a new industry is emerging, as private contractors start fixing up some of them. Although many buildings are in a state of near-total ruin, those ruins are punctuated by the occasional refurbished building, some of them beautifully renovated.

The tragedy of Cuba is the tragedy of the commons. Since the revolution in 1959, homes, apartments, stores, streets, parks and other places have theoretically been shared resources, so nobody takes care of them. In the neighborhood where our apartment is, many of the homes look condemned, and this is in the coveted Vedado district. But everywhere you see cars from the 1940s and 1950s that are privately owned and mostly well taken care of.

Cuban material goods and buildings exist on the extremes. Cuba has the worst-maintained homes and the best-maintained cars. Some residential streets (where tourists are not expected to go) are littered with trash, but Cuban beaches and waters are pristine. Cuban agriculture is primitive, but Cuba has the world's best honey because the country can't afford pesticides.


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