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Cuban authorities crack down on illegally traded cigars amid growing crisis

HAVANA - "I'm always scared," said Pedro as he deftly twisted large tobacco leaves to make fake famous name Havana cigars in a clandestine workshop in the Cuban capital.

If caught in his illegal workshop, known as a chinchal, Pedro could face a prison term. "It's not a business, but a necessity to survive," Pedro said in the dim light of the dilapidated building.

With long-suffering Cuba hard hit by the economic crisis and pounded by two hurricanes last year, the government has stepped up its fight against illegal trade, including in cigars.

Sales in the famous smokes fell three percent last year, according to a report released at a Havana trade show last month.

But workers such as Pedro do not plan to give up their lucrative business any time soon despite the risks.

The 33-year-old, sporting an earring and a tracksuit, learned his craft in state factories, making famous brands such as Cohiba, Romeo y Julieta or Montecristo cigars.

He used to earn the country's average monthly wage of $17, but he declined to reveal the size of his pay rise since turning to the black market five years ago.

Pedro's skilled hands make around 100 cigars a day, and a box of 25 sells for between 30 and 40 dollars, four or five times below the official price.

President Raul Castro's government recently underlined the need to defend the values of the island's 50-year-old revolution in its campaign against corruption, which impacts on an annual tobacco income of $390 million.

"Forgeries and the black market are two scourges which really affect the image of Havana cigars: on the one hand because the products are false, and on the other because they affect the distribution network that we've built up," said Adargelio Garrido, legal director of the Anglo-Cuban group Habanos.

Each traveller to Cuba is allowed to take home up to two boxes of cigars, but authorities still confiscate between 1,500 and 1,700 boxes per month made in illegal workshops like Pedro's.

A small cement staircase leads to the crumbling workshop, which operates with a network of helpers.

Farmers from the western Pinar del Rio province - birthplace of Cuba's prestigious tobacco - provide the leaves, while factory workers steal wooden boxes, paper rings, and other official stamps and certificates.

"It's not that difficult to get supplies from factories because all the administrative services work separately, so they're not suited to check ups,' said 42-year-old Juan, one of many clandestine retailers.

Pedro said he turned to the illegal trade five years ago when his father fell sick. He set up the operation in the elderly man's home, and turned one room into an illegal workshop.

"No one knows what I'm doing here," Pedro said.

Thursday, March 26, 2009

Source: Business World Online

Cuban authorities crack down on illegally traded cigars amid growing crisis