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Cuba grants state firms more autonomy to revive economy

HAVANA, April 28 (Xinhua) -- Cuba has granted greater autonomy to its state-owned companies to modernize and decentralize the country's aging economic model.

Taking effect on Monday, the move will affect some 2,800 state companies that represent 80 percent of the country's economy, according to the official Cuban daily Granma.

New regulations allow state companies, whose profits have been on decline due to misguided administrative policies, to sell any surplus at market prices after meeting their state commitments, and all restrictions on wages have also been lifted.

"Companies may distribute wages to the limit of their economic and financial capacities," the daily said.

Cuban state employees now earn an average of 19 U.S. dollars a month, a sum the government has acknowledged as insufficient, while employees in the flourishing private sector usually earn no less than 100 dollars.

The new regulations also allow companies to retain up to 50 percent of their profits at the end of the tax year, 20 percent more than before, in order to increase the working capital, investment, research and development, training, and bank loans repayment.

The firms' decision-making process will also be "decentralized," Granma said.

Since assuming power in 2008, President Raul Castro has gradually introduced a series of reforms to revive the country's economy, which grew 2.7 percent in 2013, below the state's target of 3.6 percent.

Earlier this month, the Cuban government published the new Foreign Investment Law aimed at attracting at least 2 billion U.S. dollars a year in foreign investment.

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