Employees stated that there had been a theft in the warehouse and that an audit was imminent, which meant they could no longer provide their services.

By Francisco Acevedo

HAVANA TIMES – Nothing has made as much headlines in Cuba these days as the unexpected closure of a Chinese wholesale business in Havana under rather strange circumstances.

You might think this is a local or isolated case, but it is not. It reflects the chaotic way things are going in this country. Let’s get into the details.

First, it must be clarified that this is not the first Chinese store to open in Havana in recent months. In December, GD-Mart opened, a joint venture between the local Tiendas Caribe and the Chinese company Guangdong Stationery & Sporting Goods, Corp. However, online payments were only accepted from abroad.

There is also the newly established Dofimall, which focuses mainly on imports from abroad and has an assortment of industrial and agricultural equipment and machinery, as well as cars, hardware, furniture, textiles, leather and other products made in China. In none of these cases are these stores really intended for the average Cuban consumer.

Back to the controversial shop: It is called “China Import” and is located at the intersection of Manglar and Oquendo streets in the Cerro district of the capital. It belongs to the Chinese chain Nihao53.

The warehouse, located very close to the iconic Cuatro Caminos market (remember, when it opened in 2019, it was the site of the famous mass panic), sold wholesale products at quite competitive prices compared to those offered by other companies and shops, but with a somewhat peculiar commercial policy that was unusual in Cuba.

The final purchase amount had to exceed 50 dollars, which, at the fluctuating exchange rate of around 320 pesos per dollar, is equivalent to 16,000 pesos – a sum already unaffordable for most of the Cuban population. But you couldn’t buy everything you wanted, since the products had a minimum quantity of up to 12 units set by the owners.

In other words, not only did you spend a lot of money, but you may also have had to buy products you didn’t need multiple times. The main buyers were therefore resellers and owners of small and medium-sized private enterprises (SMEs), since prices there were actually lower compared to the rest.

The store offered a wide variety of goods, from clothing and shoes to perfumes, prescription glasses, small electrical appliances and household items, but returns were not possible.

The first problem arose with transfers. At first they accepted international platforms such as Qva Pay, TropiPay, Lian Lian, international bank transfers or domestic transfers through Transfermóvil and EnZona. However, connection problems arose and recently everything has only been possible in cash.

Until then, everything was more or less fine, but last Thursday a sign saying “Closed until further notice” was hanging on the store and the speculation began.

Employees we interviewed said that there had been a theft in the warehouse and that an audit was imminent, which meant they could no longer provide their services.

There was no further mention of the theft afterward, even when we wrote to the phone number posted on the fence to seek further information on the matter. This number was later removed from the temporary sign, apparently because there were too many calls and messages.

If there had actually been a defect in the goods, as we were informed that day, this would be a serious matter, as the facility is completely fenced in with only one entrance and the defect mentioned could not have been remedied without heavy goods vehicles that can only enter through the guarded gate. This requires the cooperation of the workers on site.

Whether the theft is true or not, the inspection confirmed it in both cases. The strange thing, however, is that when a company conducts such an inspection, it does not remove all the advertising from the store, as happened in this case. That same Thursday, the product advertisements at the entrance to the store had disappeared and were replaced by the old sign of Suchel Debon, the former name of the soap factory that once operated there.

Although the duration of the closure is not certain, none of those who want to keep the store running are removing the advertisements, which suggests that “El Chino”, as the owner is popularly known (even though he is Cuban), had enough and preferred to close permanently, at least at this location.

It is speculated that the commotion caused by the videos circulating on social media – as the shop had been operating for over a month without any problems – caught the attention of an official who, possibly at the urging of another private business owner (who may also be a relative of the official), questioned the method of payment in the informal exchange market, which is not permitted to other shops.

The problem is that this was supposedly approved by the Ministry of Domestic Trade and the Ministry of Finance and Prices, which raises serious questions about the way business is done in this country.

The supposed easing of economic policy comes to a halt when it collides with the interests of any “cabezón” (bigwig), as officials or their relatives are called in Cuba.

In this specific case, it justifies those who used the first month to hoard and are now reselling because the competition no longer exists, which is exactly the opposite of what was intended.

While it was logical that resellers would be the main customers in the beginning, these people tended to disappear once it was clear that the store would continue to operate, as customers could go directly to the source for the best price and resellers had products for which there was much less demand.

However, if business does not resume, these people can now sell their products on “China Import” at any price they want because they are simply the only ones who own these products.

It is too early to draw a definitive conclusion, but the whole thing smacks of improvisation. If not, it would be even worse, because it would mean not fulfilling the commitment made with a foreign investor, and that is a luxury that Cuba’s impoverished economy cannot afford.

Read more from Cuba in the Havana Times here.