WORLD Cuba announces refusal to accept U.S. dollars

Castro said other foreign currencies would still be accepted.
HAVANA (AP) -- Moving to wean its communist economic system from the U.S. currency, Cuba said that dollars will no longer be accepted at island businesses and stores in a dramatic change in how commercial transactions have been done here in more than a decade.
The resolution announced Monday by Cuba's Central Bank seemed aimed at finding new sources for foreign reserves and regain more control over its own economy as the U.S. government steps up efforts to prevent dollars from reaching the island as part of a strategy to undermine Fidel Castro's government.
Cuba's national currency, the peso, cannot be used with international partners.
"Beginning on November 8, the convertible peso will begin to circulate in substitution of the dollar throughout the national territory," Castro said in a written message read by his chief aide Carlos Valenciaga.
In his message, Castro asked Cubans to tell relatives living abroad to send them money in other foreign currencies, such as euros, British sterling or Swiss francs.
The move was likely to hurt mostly those Cubans who receive American dollars from relatives living in the United States.
Cubans and others on the island can still hold dollars in unlimited quantities and can change them into pesos before the new policy takes effect. But they will have to pay a 10-percent charge to exchange dollars afterward. There will be no such charge on changing other foreign currencies, such as Euros, into convertible pesos.
Looking at effects
"In the short term, there may be a slip in the remittances," said John Kavulich, president of the U.S.-Cuba Trade and Economic Council, which tracks business between the two countries. Some estimates on annual remittances to Cuba are as high as $1 billion.
"But going into the holidays, people in Miami and New Jersey won't want the holidays for their families on the island to be even more miserable," he said, predicting remittances from those major Cuban American communities would pick up again, despite the difficulty of sending them and the 10-percent charge.
Kavulich said the timing of the announcement seemed aimed at drawing attention to Cuba shortly before the U.S. presidential election.
"The Cuban government is hoping that Kerry will win and that by announcing this a week before the election it will keep Cuba in the news and relevant," said Kavulich.
He said that because Havana is blaming the American sanctions for this new economic measure, the debate over the U.S. trade embargo will be in the public eye when the elections occur.
Cuba also has been seeking to draw attention to the U.N. vote scheduled for Thursday on condemning America's trade embargo against the communist nation.