Cuban businessmen see freedom on the horizon

Daniel Garcia Perez shaves CBS News correspondent Byron Pitts in his barber shop in Santiago, Cuba
CBS News

(CBS News) Pope Benedict XVI began his second day in Cuba with prayers near Santiago, at the shrine of the country's patron saint.

Later, he flew to Havana for a meeting with President Raul Castro, and possibly his brother Fidel, who led the communist revolution.

Cuban officials rejected any thought of political reform, but CBS News correspondent Byron Pitts reports that some things are changing there.

There is no mistaking the timeless moves and music that remain authentically Cuban. But from the streets of Santiago in the south to Havana on the Northern tip, there is a new sound, and it's getting louder. It is the songs of the self-employed.

"The advantage of owning my business -- I am the boss of me," said a Cuban sculptor.

He is one of 300,000 Cubans who received a license to run their own business in the past year, all part of the biggest shake-up to Cuba's state-run economy since Castro took power. And while it won't solve the country's economic problems, it has put more money in the hands of some.

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"Even my family members that work for the state are looking for jobs in the private sector. They pay better," the sculptor said.

Now motorcycle cabbies, nail salons, restaurants, fruit and vegetable stands, have all taken root. Is it free enterprise? Not quite. License holders still must pay taxes of 25 to 50 percent.

On Calle Enramada in the heart of downtown Santiago, the Cuban government shut down the street to cars in an effort to increase foot traffic and local commerce. It was one more small admission that the old ways of doing business no long worked.

At Elle's barbershop, Daniel Garcia Perez started cutting hair at 16. He was a barber in this state-run shop for 29 years. Guess who owns the shop now?

"I feel really good," Perez said. "I charge double now. I can now afford better equipment."

The U.S. embargo that bans doing business in Cuba is still in place, so we wondered where that 'better equipment' came from. Perez was hesitant. But Juan Jr. his assistant was happy to tell us.

"This is from the U.S. The best shaver in the world," said Juan Jr., who described the process of getting around the U.S. embargo as "complicated."

They said friends buy the equipment in the U.S., ship it to Mexico, and then it's brought legally into Cuba.

There is a sense here freedom is down the road. One after another business owners told CBS News they can see it on the horizon.