Belt-tightening begins in Cuba

Cubans awoke to a New Year filled with sober reminders that they face tough months ahead as their communist government struggles with an island economy in dire straits. The most drastic economic reforms in a generation have now begun to take effect, with the first layoffs of state workers beginning in five sectors. Officials also announced on Monday mandatory rationing on sanitary items such as soap, toothpaste and detergent.

Workers' Confederation head Salvador Valdés said the first layoffs had begun in President Raúl Castro's objective of slashing 500,000 workers from the government payrolls this year. The total number of layoffs represents 12 percent of all Cuba's government employees.

In Monday's edition of the state-run weekly Trabajadores, Valdés said that first layoffs have occurred in the sugar, agriculture, tourism, health and construction industries. However, the publication didn't say when the layoffs began or how many people have been affected by this first round.

In a speech published on December 23 in the state newspaper Granma, Economy and Planning Minister Marino Murillo warned that Cuba will have to import some $1.6 billion in foodstuffs in 2011 if the country is "not capable of making production more efficient."