CUBA TO DO AWAY WITH DUAL CURRENCY SYSTEM

Presently, most Cubans are paid in the Cuban peso, or CUP, while the vast majority of goods on the island are available only with the hard currency convertible peso, or CUC, which is pegged to the U.S. dollar.

Neither peso is accepted as currency outside of Cuba.

The dual system came into being after the collapse of the Soviet Union when Cuba introduced the U.S. dollar as the country's second currency.

In 2004, the government replaced the dollar with the convertible peso. The dual-currency system is unpopular with many Cubans, who complain that the Cuban pesos they received their salaries in are not accepted in stores that carry sought-after imported goods.

The announcement in the Cuban Communist Party newspaper Granma said the change is to be a gradual process, but gave no timetable.

"The currency unification isn't a measure that will resolve on its own the current problems of the economy. But its adoption is vital to restoring value to the Cuban peso," the announcement in Granma read.

For months, Cuban officials have said ending the two-currency system was a priority but the move would have a major impact on the government's gradual attempts to move from a centralized, communist-style economy.

The announcement Tuesday said the Cuban central bank will continue to back both currencies and give Cubans time to convert their savings.