Post-communist Cuba will need an export-led recovery

The slow-motion implosion of the Cuban economy is accelerating. While Venezuela has provided Cuba with heavily subsidized (practically free) oil, the removal of Nicolas Maduro as president combined with Russia’s reluctance to contribute substantial financial support to Cuba, means it is just a matter of time before total collapse occurs.

Dismantling a Marxist regime is no easy task, especially after 67 years of control. But anyone well-versed in Cuba’s culture and history knows well that Cubans are more pragmatic than ideological. “Let’s make a deal” will be the mantra going forward.

Arguably the greatest challenges to a post-communist government in Cuba will not be political but economic. Up to 89 percent of Cubans live in extreme poverty, with most households surviving on the margins due to severe shortages of food, medicine, and electricity. The country presently faces its worst economic crisis since the 1990s, forcing many residents into extreme hardship and prompting a massive exodus, with 78 percent planning to emigrate. 

Cuba’s exports have fallen by 75 percent since 2000, and GDP in 2026 will shrink by 7.2 percent. The average Cuban must rely on government rations that are often inadequate and limited while the average state salary is around $20 per month — roughly the U.S. price to have a Burger King Double Whopper meal with extra fries delivered.

Recognizably, post-communist Cuba will need massive financial resources to address the dire needs of the population. While the U.S., Canada, and the EU will stand ready to contribute, one should not expect a Marshall Plan for Cuba. As for foreign investment, Cubans in the diaspora will surely consider investment opportunities after the U.S. embargo and other restrictions are removed........

© The Hill