Cuba reintroduces the dollar

AMERICAN SALOONS from the 1950s and Chinese-brand cars still fill Havana’s streets. Lately, though, they have shared the road with brand-new electric scooters. Once rarities—sourced in Panama, Mexico or the Dominican Republic and sold at a big mark-up in the black market—scooters can now be purchased at home, and far more cheaply than before. The catch: Cubans must pay in American dollars or another rich-country currency.

In October Cuba’s communist government said citizens could open bank accounts that receive dollars, yen, euros and other European currencies. They will be able to use the money to buy imported goods from new state-owned shops, called Tiendas Moneda Libremente Convertible (or convertible-currency shops), where prices are given in dollars. More than 70 are planned. This ends a ban on dollar transactions introduced in 2004.

The Tiendas MLC are proving popular. Shoppers queue to buy refrigerators, air-conditioners, car parts and television sets. Some items, including freezers and scooters, cannot be restocked quickly enough.

By reintroducing the greenback, Cuba has in effect added a third leg to its dual-currency system. The state pays its employees (ie, most workers) in Cuban pesos, the currency for buying necessities like electricity, water and bus tickets. In 1994, during the “special period”...