MercoPress. South Atlantic News Agency

Cuba Announces Revaluation of Currency

President Fidel Castro late Thursday announced a 7 percent revaluation of Cuba's national currency, giving Cubans slightly more buying power as the communist-run island moves to reassert greater control over its economy.

The move comes four months after Cuba eliminated from circulation the U.S. dollar, which was used as legal tender for many goods and services for more than a decade.

Cuba now uses two currencies: the regular Cuban peso, which was the one revalued, and the convertible Cuban peso, which trades at 1-1 to the dollar.

While the regular Cuban peso is used for government salaries and most government goods and services, the convertible Cuban peso has been used for many other consumer goods at businesses where the dollar was once accepted.

Starting Friday, the convertible Cuban peso, which previously could be purchased with 27 ordinary Cuban pesos, will now be worth 25 Cuban pesos, Castro said. The decision appeared aimed at slowly eliminating one of the two currencies now circulating on the island.

Reading from a resolution by Cuba's Central Bank at the end of a three-hour televised speech, Castro said the decision was based on improved trade relations with Venezuela and China and the recent discovery of oil deposits off the island's coast.

Castro has hinted repeatedly in recent months that he wants Cuba to have just one currency and eliminate confusion and inequalities created when the U.S. dollar was legalized in 1993.