Cuba reported to scrap dual currency system 01.01.2021

One characteristic feature of the Cuban economy has been the coexistence of two currencies: the Cuban peso (CUP) and the Cuban convertible peso (CUC). Both means of payment had their specific area of use: there was one market for the Cuban peso and another for the convertible peso. The Cuban convertible peso was first issued in 1994, pegged to the US dollar, and was used in commercial transactions made in establishments that were authorized to sell products and provide services in freely convertible currency. The public could exchange the two currencies at Cuba’s currency-exchange bureaux. These banknotes are denominated in pesos, but the exchange rate with foreign currencies was different than that applied to regular Cuban pesos (moneda nacional).

According to multiple news sources, on 10 December 2020, Cuba announced that it plans to eliminate the dual currency system on 1 January 2021, effectively devaluing the peso at a time when the country is expecting triple-digit inflation. President Miguel Diaz-Canel said the Cuban peso would be fixed at a single exchange rate of 24 per US dollar, and the Cuban convertible peso would be removed from circulation in June 2021.

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