News Analysis: Cuba cautious on free-market reforms as talks with U.S. move forward

Cuba is sticking to its restraint and revision approach in adopting limited economic reforms, even as the U.S. moves to restore bilateral ties with an eye to cracking open its market.

Cuban President Raul Castro, who introduced the limited economic reforms shortly after taking office in 2008 -- awakening an interest in the island country among U.S. liberals and more importantly the business sector -- is treating the policy with caution.

"We have the duty to consider and foresee the consequences of every step we take," Castro told a meeting of the Council of Ministers, the country's governing body, as they gathered Friday to review the state of the economy and the progress of experimental quasi-private enterprises in Cuba.

Castro has made it clear that while the government recognizes the need to modernize its socialist economic model, it does not plan to throw the baby out with the bath water.

In late December, soon after the U.S. and Cuba announced their decision to restore ties, Castro said the reforms aimed to " decisively contribute to improving the ... economy and to building prosperous and sustainable socialism in Cuba."

The Council of Ministers agreed "to extend the experiment" in the private sector, but with an important caveat: the government will limit new cooperatives so as to consolidate existing ones.

The cooperatives already have to abide by certain rules designed to protect workers against exploitation, including a regulation that limits the number of temporary employees to no more than 10 percent of the total.

Cuba's deliberate approach in economic reform contrasts sharply with the U.S. expectation of the eventual restoration of bilateral ties, which seems to be built on the assumption that the Caribbean island is now, or soon will be, open for business.

Ever since the White House announced its decision to engage Cuba after some 50 years of icy relations, U.S. business delegations and state representatives have been streaming steadily into Havana to woo their neighbor.

U.S. President Barack Obama immediately acknowledged the business prospects of the rapprochement as he announced the motives behind Washington's new Cuba policy.

"I believe that American businesses should not be put at a disadvantage, and that increased commerce is good for Americans and for Cubans," he noted.

In a January 2013 memorandum to Obama, which appears to have served as a road map for re-establishing ties with Cuba, Brookings Institute foreign policy expert Ted Piccone encouraged the president to continue to shape his "legacy of rising above historical grievances, advance U.S. interests in a stable, prosperous and democratic Cuba, and pave the way for greater U.S. leadership in the region."

In Piccone's view, Obama's easing of travel restrictions and caps on remittances to the island during his first term in office had already had decisive consequences.

"Hundreds of thousands of the 1.8 million Cuban-Americans in the United States have traveled to Cuba and sent over 2 billion U. S. dollars to relatives there, providing important fuel to the burgeoning small business sector and helping individual citizens become less dependent on the state," he wrote.

Despite its wish to improve the economy, Cuba is fully aware that it has to move cautiously to protect its best interests as it opens up to outside influence, especially that from the U.S., which could not wait to tout its capitalism and market economy.

"Many people are wondering and criticizing why we are going very slowly" with the negotiations, said Raul Castro. "Why do we have to rush? To make mistakes?" he argued.

"We don't want to take any measures that would sacrifice our people. That's the most important thing," he reiterated. Endite