24 February 2025

Cuba’s nickel and cobalt miner, Cubaniquel SA, has said that it expects production and efficiency at its joint venture with Canada’s Sherritt International to recover this year following a difficult 2024.

Speaking on the television and radio programme Mesa Redonda, Leonardo Rosell, the Director General of the company said that the business group was undertaking organisational improvements that would transform the company’s management, its exports, and earnings.

His remarks followed a difficult 2024 during which he said, the company introduced austerity measures that slowed  growth and saw little investment but enabled it to significantly contain costs to sustain the industry’s operations.

Rosell said that metal production last year was down by 16.6%, and export sales by 32%. He also noted that income to the country only met 75.6% of what had been planned for. This he said reflected a fall in prices for nickel and cobalt internationally, three disconnections from Cuba’s national electric energy system, and the impact of changing geopolitics. In 2024 the joint venture produced 30,331 tonnes of finished nickel and 3,206 tonnes of finished cobalt according to Cubaniquel’s joint venture partner Sherritt International.

Speaking about plans for recovery in 2025, Rosell said that the company had several fundamental goals. The first of these is, he told viewers, is to place committed and capable entrepreneurs in key positions, bringing where possible younger people from universities able to speed up processes and improve the quality and strategic decision making by the company’s staff.

Highlights in this issue: 

• Ministry of Foreign Trade and Foreign Investment told it must strengthen its role
• Marrero says Further reform measures to be announced soon
• Innovation Council agrees need to incentivise technology startups
• Influential Senator says he will seek to limit travel from the US to Cuba
• Russian Ambassador says ties are becoming dynamic

“The goal is for them to focus on the needs and not on everyday difficulties in order to be creative and make the right decisions,” he said. This will require, he explained, improving the structure, work systems, working conditions, salaries,  and productivity, and eliminating restrictions on their development. He noted also that new technologies are likely to lead to fewer staff working more efficiently and stressed the importance of workers acquiring new skills.

Last month Sherritt said that it had ended 2024 with robust operating results close to its forecast. A company release quoted Leon Binedell, the President and CEO of Sherritt, as saying that operational performance in 2024 “was a resounding success in the face of significant headwinds.” Despite numerous external challenges, “we successfully navigated extraordinary hurdles including hurricanes, an earthquake, and nationwide power outages in Cuba, as well as rail and port labour disruptions in Canada, “ he said.

Sherritt in a market report said that its low cost and low capital intensity Moa joint venture  expansion programme continues to advance, and it expects to conclude a second phase in the first quarter of 2025 and then ramp up production. It added: “This will see the Moa JV undertaking a series of measures to remove minor processing bottlenecks to support an expected 20% increase in annual mixed sulphide precipitate (“MSP”) production.”

“The additional MSP is expected to fill the refinery to capacity to maximise profitability from the joint venture’s own mine feed, displacing lower margin third-party feeds and increasing overall finished nickel and cobalt production,” the company said in a late January 2025 statement.

Sherritt’s Moa JV has an estimated mine life of approximately 25 years and is advancing an expansion programme focused on increasing annual MSP production by 20% of contained nickel and cobalt. MSP is a nickel-containing intermediate used in the production of nickel sulphate.  The Moa JV is 50% owned by Sherritt and Cuban government owned General Nickel Company SA.

The joint venture’s power division, through its ownership of Energas SA, is the largest independent energy producer in Cuba with installed electrical generating capacity of 506 MW, representing approximately 10% of  Cuba’s national electrical generating capacity. The Energas facilities are comprised of two combined cycle plants that produce low-cost electricity from one of the lowest carbon emitting sources of power in Cuba. 

Sherritt said that Energas expects that the Varadero facility will operate in frequency control throughout 2025 to help support the stability of the Cuban grid with an estimated reduction in electricity volume of approximately 150 GWh

24 February 2025, Issue 1268

 The Caribbean Council is able to provide further detail about all of the stories in Cuba Briefing. If you would like a more detailed insight into any of the content of today’s issue, please get in touch.

17 February 2025

The US Senators Rick Scott (R-Florida) and Tommy Tuberville (R-Alabama) have reintroduced a bill aimed at passing into law measures imposing “severe sanctions” on the Cuban government, and on third parties and entities engaged in transactions with sanctioned Cuban persons and bodies.

If passed, The Democracia Act (Denying Earnings to the Military Oligarchy in Cuba and Restricting Activities of the Cuban Intelligence Apparatus act), would authorise the US President to impose “unprecedented financial pressure,” according to Scott, on foreign citizens or entities engaging with many of the most senior members of the Cuban government.

Senator Scott said that the Bill would “impose sanctions—blocking assets and denying entry into the United States—on a foreign person if the President determines that the person knowingly engages in an activity with Cuba’s defence sector, security sector, intelligence sector, or any other sector involved in carrying out human rights abuses or providing support for international terrorism.”

The draft bill also applies sanctions to family members and “any entities that are owned, directly or indirectly, 25% or more by one or more designated persons.”

It additionally seeks to sanction almost all members of the Cuban government, military, judiciary, and their family members until Cuba has “released all political prisoners, legalised all political parties, establishes a free press, and holds multiparty elections that are internationally observed elections in a timely manner.”

The bill further requires the US President to “use all means possible to provide unrestricted, reliable internet service to the people of Cuba” that cannot be  blocked.

Initially introduced in October 2021, the Democracia Act has already gained significant support from Republican legislators in the Senate as well as in the House from the Floridian Republican Representatives Mario Díaz-Balart, Carlos Giménez, and María Elvira Salazar.

The draft bill has been sent to the Senate Committee on Foreign Relations for review.

Highlights in this issue: 

• Western Union halts its Cuba money transfer operations
• Government temporarily suspends schools and work activities to save electricity
• New economic management model for media may be applied to other sectors.
• Trump Administration to take ‘very creative’ policy approach to Cuba
• Russia’s Ambassador hopes Díaz-Canel will visit Moscow in May

In an indication of the potential likelihood of the draft bill proceeding, Senator Scott noted on his website that he previously “led this legislation with Secretary of State Marco Rubio last Congress.”

The draft text of the bill and details relating to co-sponsors to date can be found at https://www.govtrack.us/congress/bills/118/s504/cosponsors

17 February 2025, Issue 1267

 The Caribbean Council is able to provide further detail about all of the stories in Cuba Briefing. If you would like a more detailed insight into any of the content of today’s issue, please get in touch.

10 February 2025

Cuba’s Council of Ministers have approved a detailed action plan for 2025 that places special emphasis on the delivery of “a new mechanism for the management, control and allocation of foreign currency for all economic actors; the creation of a foreign exchange market, and the partial dollarisation of the economy.”

Cuban official reporting indicated that Minister’s agreement to the “cross-cutting” action plan is expected to define the steps required this year to deliver the programme of macro-economic reform that was first announced in late 2023 and is intended to “relaunch the economy” in 2025.

The report contained no details of how or when the new forex mechanisms will be introduced or what is to be proposed.

Addressing the meeting, Cuba’s Prime Minister, Manuel Marrero, said that the measures were vital to advancing the rest of government’s programme because of their positive impact on two key objectives: “increasing and diversifying the country’s external income” and “Increasing national production, with an emphasis on food.”

The plan he said, requires “a system of work that allows sustainable monitoring and control.” It will also need, he stressed, constant analysis at all levels, “especially the progress of measures that have the greatest impact on the population and communities.”

Much of the reporting of the meeting focused on ministers hearing about progress made on the implementation of planned macroeconomic reforms in 2024 and January 2025. These included, according to the First Deputy Minister of Economy and Planning, Mildrey Granadillo de la Torre: analysing recommendations; proposals to strengthen the future attractiveness of the Mariel Special Development Zone as a location for foreign direct investment; trade activities by non-state economic actors; the steps taken to date to deliver a  ”new mechanism for the management, control and allocation of foreign currency;” and a proposal for the creation of an official exchange market.

Highlights in this issue: 

• Rubio tightens US sanctions, Cuba suggests more may follow
• Power outages continue to affect up to 45% of country
• Minister says up to 7% of Caribe and CIMEX supermarkets to be dollarised
• President stresses need for improvements in Cuba’s national statistical system
• First of 30,000 migrants flown from US to Guantanamo naval base

The meeting also approved a plan for the topics to be discussed by the Council of Ministers and its Executive Committee this year. These include problems related to the intended future role of municipal assemblies and their ability to discuss and deliver their part of the national Economic Plan and the State Budget for 2025, an issue of growing concern to ministers. Speaking about the topic, Cuba’s Prime Minister said not all the plans and budgets that municipal assemblies had presented  had  a clearly defined alignment with their municipal development strategy. He also noted that their (social and economic infrastructure) maintenance and repair plans did not always consider the proposals of voters, or the need to complete work in neighbourhoods undergoing transformation.

He also stressed that that while actions have been included to increase income and reduce expenses, municipal assembly proposals had not always reflected the need for greater production based on the potential of the territories to meet the demands of the population.

In an interesting indication of the emphasis Cuba is now placing on the development and application of  Artificial Intelligence (AI), the Minister of Communications, Mayra Arevich, presented a strategy for its development and its use in the island’s Digital Transformation Policy. See Cuba Briefing 3 February 2024 for background. Granma reported that the related focus of ministers’ discussions revolved around the six main axes of Cuba’s proposed AI strategy: ethics, the creation of a regulatory framework, the development of human capital, the application of AI to services and public administration, science and innovation, and social communication.

The proposals reportedly envisage the gradual and growing incorporation of AI into daily processes, prioritising those that have the greatest social and economic impact.

Granma quoted President Díaz-Canel as telling ministers that despite the many challenges involved in the development of AI given Cuba’s economic limitations, priority “must be placed on its development,” and he said, on clearly defining how each organisation will use it as a tool to raise productivity.

10 February 2025, Issue 1266

 The Caribbean Council is able to provide further detail about all of the stories in Cuba Briefing. If you would like a more detailed insight into any of the content of today’s issue, please get in touch.

03 February 2025

Cuba is now far ahead of most countries in the region in relation to cybersecurity despite the absence of co-operation from the US, according to senior Cuban officials. It is also rapidly developing an Artificial Intelligence capacity through an integrated programme involving state and private sector entities.

Speaking during a recent edition of the Cuban television programme Mesa Redonda, Yoandry Pardo, the Director of Computerisation at the Ministry of Communications, said that although the Americas is one of the most backward regions in terms of cybersecurity, Cuba in recent years, “and especially now,” has been able to accelerate its  progress as “rapprochements have been achieved in friendly countries such as Russia, China and Vietnam.” 

With approval last year by the government of a digital transformation policy and an artificial intelligence strategy, Pardo said, the importance of the cross-cutting issue of cybersecurity to ensure that both processes are secure has been recognised. Both, he told viewers, were vital for the sovereignty of the country and for the protection of citizens’ data.

Speaking on the same programme, Daniel Perea, the Director General of the Office of Security for Computer Networks (OSRI), noted that as Cuba became a more interconnected society, cybersecurity had become vital to the protection of critical infrastructure and the country’s financial and other gateways.

Perea said that a lack of resources, the US embargo, and the cost of technologies,  all presented additional challenges to Cuba’s ability to counteract cyberattacks against the systems its uses, which are based on free software technology and the development of industry-specific solutions. 

Because Cuba had been excluded from international cooperation to improve responses through the cybersecurity information system, CERTS, it has had to establish its own “CuCERT,” system to receive and examine cybersecurity reports, as well as develop information on emerging threats, Perea noted.

Highlights in this issue: 

• Official figures show visitor arrivals fell by 9.6% last year
• Cuba’s inflation rate in 2024 reached nearly 25%.
• President criticises Trump’s decision to send 30,000 migrants to Guantanamo naval base
• Sweden seeking support for a review of the EU-Cuba PCDA agreement
• Banco Nacional to take CRF I debt issue to UK Supreme Court

Later in the same programme, addressing the evolving cyber threats facing the country as Cuba expands the automation of it industries, Edismar Saavedra, the Director General of Strategic Projection at the Ministry of Industry, noted that Cuba adopts higher the level of automations, the more vulnerable its businesses are to being attacked.

As soon as automatic elements begin to be incorporated into technological lines, they are more vulnerable and “that is why security levels must increase in proportion to the development of the evolution of the industry,” he said.  For this reason, Cuban managers must increase their risk perception and educate their staff to consolidate industrial cybersecurity in all facilities, Saavedra observed.

The broadcast made clear the continuing centrality to Cuba’s cyber security and AI development of the Faculty of Cybersecurity at the Cuba’s University of Computer Sciences (UCI) located near Havana, and UCI itself which was established in 2002 and is now producing annually large numbers of graduates for all parts of the Cuban government and helping develop rapidly emerging groups of private developers.

Speaking on the programme, Dr Mónica Peña, the UCI’s Dean, stressed the importance now being placed on the training of cybersecurity specialists to respond to current demands. Specialist degree courses in cybersecurity engineering and short cycle courses have, she said, been established involving what she described as “a fairly large enrolment, from various sectors of society.”  UCI, she said, was now providing one of the most advanced degree courses in Latin America, addressing topics such as critical infrastructure security, forensic computing, and secure software development.

In a separate but related development, Russia and Cuba have agreed to implement several joint projects related to non-western communications and information technology.

According to the Russian media, a recent seminar in Cuba, “The Path to Technological Independence,” reportedly addressed collaboration based on “reliable Russian platforms. At the event, Valentin Makarov, the President of Russia’s Russoft Association, spoke about how the organisation’s  focus on the global market changed in 2022 following the start of Russia’s military operations in Ukraine.

The Association’s task now, he said, was to reorient itself towards the domestic market, with a strong emphasis on import substitution programmes, enabling it “to replace all Western technology to achieve full sovereignty.” This was an experience, he said,  that Russoft “now wants to transfer to friendly countries such as Cuba.”

Makarov, was reported to have said that the hope is that joint projects with the Cuban company Aikros would enable the development  of a platform to provide computer products for the Latin American market.  Russoft brings together more than 360 Russian companies which together have  about 100,000 employees,

Cuban reporting relating to the meeting indicated that at it, both Russia and Cuba had “expressed their support for developing collaboration for the use of Artificial Intelligence,” and the importance of Russia’s experience with automation in relation to Cuba’s national energy system.

Cuba has also made clear that it is placing significant emphasis on developing its expertise in relation  to artificial intelligence by joining with entities in BRICS member countries and as reported previously, with China.

In the case of the BRICS plus group, of which Cuba is now an associate member, the island is now a part of the BRICS AI ​​Alliance Network and is aiming to develop closer strategic cooperation. It is also hoping to explore possible financial support from the Russian state bank, Sberbank, that is available to facilitate joint research in AI technology and regulation in BRICS plus nations. In Cuba’s case, according to Rafael Luis Torralbas, the President of the Havana Scientific and Technological Park, a Cuban commercial entity,  it is planning an event for this year that is expected to bring together experts from BRICS plus  countries and related organisations to present projects and seek support from Sberbank’s common fund.

Although Cuba has  a community of researchers, there are so far few national developers or products and services that incorporate AI. To address this, Cuba has established a national development strategy for AI involving all research groups and universities working in the area with the objective of delivering a national digital transformation policy. The intention now, officials say, is to create and implement an AI strategy that will initially be applied to higher education, transcripting voice to text, and developing cutting-edge generative AI technologies, before moving on to other objectives.

03 February 2025, Issue 1265

 The Caribbean Council is able to provide further detail about all of the stories in Cuba Briefing. If you would like a more detailed insight into any of the content of today’s issue, please get in touch.

27 January 2025

In the first hours of assuming the US Presidency, President Trump revoked the order published days earlier by the outgoing Biden Administration intended to remove Washington’s designation of Cuba as a state sponsor of terrorism (See Cuba  Briefing 13 January 2025).

The effect is to reimpose  tighter controls on US exports, restrictions on foreign aid, stricter US visa requirements, and a freeze on Cuba’s international financial transactions that might pass through US entities, by extension making most third country trade with the island more difficult or impossible.

Trump also reversed the changes to the so-called ‘restricted list’ which bans US companies and individuals transacting business with 231 entities or state related companies and 422 hotels and accommodations, unless licensed by the Federal government to do so. Although lifted by the Biden Administration in its dying days the sanctions will now be reimposed on designated Cuban companies in the tourism, hotels, financial, and services sector most of which are subsidiaries of the military controlled conglomerate, GAESA.

The future of the six months Biden waiver relating to Title III of Helms Burton which halted the right of claimants to take legal action against those alleged to be trafficking (benefitting) in expropriated assets remained unclear at press time.

The 20 January order revoking President Biden’s 14 January decision came as Trump also revoked the previous administration humanitarian parole programme for Cuban which had allowed 30,000 non-citizens per annum to migrate legally to the US from Cuba and three other nations. (See story under United States below).

Highlights in this issue: 

• Finance Minister says budget a step towards sustainable development
• Cuba’s President stresses importance of military combat readiness as exercises begin
• New agreement reached on official debt with Paris Club
• Prime Minister reaffirms tourism’s success essential for economy
• Telecoms executive warns new investment in infrastructure required as demand surges

TResponding in an extended post on X, President Díaz-Canel wrote: “President Trump, in an act of arrogance and disregard for the truth, has just reinstated the fraudulent designation of Cuba as a state sponsor of terrorism. This is not surprising. His goal is to continue strengthening the cruel economic war against Cuba for purposes of domination. The result of the extreme economic blockade measures imposed by Trump has been to cause shortages among our people and a significant increase in the migratory flow from #Cuba to the United States.”

Subsequently, the Cuban Government issued a strongly worded declaration titled, “In the face of the imperialist onslaught, Cuba will win.” The lengthy statement described the US decision as  showing an “absolute disregard for the truth,” but was unsurprising, noting that on 14 January Cuba’s Foreign Ministry had warned that “the government of that country could reverse in the future the measures adopted today, as has happened on other occasions ….” It described President Trump’s return to power as “the coronation of an emperor” with territorial ambitions, and  the “Monroe Doctrine and Manifest Destiny” ….  as …. “the guide for the new [US] government team.”

The statement went on to warn that “the new aggressive measures will continue to weigh, with a very damaging effect, on our economy, the standard of living, the potential for development …. as has been the case in recent years,” and to say that the US decision “will not divert us from the socialist path.”

In the light of the Cuban government’s earlier unwillingness to link the Biden Administration’s decision to an agreement with the Catholic Church that it would release 553 Cuban prisoners, the Cuban government could be torn between its close relationship with the Vatican and the Pope and a desire to respond to the Trump administration’s announcements by reducing or halting any further prisoner releases.

Reuters reported however, that the Bishop of Havana, Eloy Dominguez, who oversees the Catholic Church’s local relations with prisoners, said that Trump’s decision should not interfere with the process. “The release of prisoners in Cuba will continue,” Dominguez was quoted as saying.

However, the Cuban Observatory of Human Rights, based in Spain, expressed concern in a statement about “the possible cancellation, pause or delay of the release of political prisoners in Cuba.”

Other NGOs have reported that as at 21 January some 140-plus prisoners had been freed including some prominent activists. Most released had been imprisoned for participating in the street protests of 11 July 2021. Among those reported to have been freed is Pastor Lorenzo Rosales after serving three and a half years in jail. Britain’s Foreign Secretary, David Lammy, recently wrote to him to express the UK government’s continued commitment to seeking his release. (Cuba Briefing 13 January 2025).

Despite this, several NGO’s have noted that since Donald Trump reinstated Cuba’s terrorism designation the prisoner release process has slowed or halted. Commenting about what may now happen, an EU spokesperson called on Cuba to continue to release political prisoners.

In related news, Senator Marco Rubio, has been unanimously confirmed by the US Senate as the new US Secretary of State. The outcome and his swearing in followed a hearing that focussed on the detail of foreign policy issues and recognised his in-depth understanding of Latin American and Caribbean issues. His appointment received support from several Democratic senators.

Rubio and his incoming hard line Assistant Secretary of State for the Western Hemisphere, Mauricio Claver-Carone, also a Cuban American, are now expected to tighten and more closely coordinate US policy towards Cuba and the Latin America Caribbean region across the US administration. During his confirmation hearing, Rubio said he had “zero doubt” that Cuba is a state sponsor of terrorism.

27 January 2025, Issue 1264

 The Caribbean Council is able to provide further detail about all of the stories in Cuba Briefing. If you would like a more detailed insight into any of the content of today’s issue, please get in touch.

20 January 2025

In a surprise announcement on 14 January, just days before demitting office, the White House said that President Biden was removing Cuba from the US list of state sponsors of terrorism; suspending the right of claimants to take legal action under Title III of Helms Burton against companies that traffic in expropriated property; and ending sanctions on Cuban companies banned from doing business with the US.  

The White House spokesperson, Karine Jean-Pierre, said that the now former President’s decision is intended,  “to support the Cuban people as part of an understanding with the Catholic Church under the leadership of Pope Francis.” It would also, she said, “improve the livelihood of Cubans,” and “advance the human rights of the Cuban people.” Announcing Biden’s decision, Jean-Pierre noted that it honoured “the wisdom and counsel”  provided to him “by many world leaders, especially in Latin America.”

Welcoming the changes, the Cuban government avoided linking the rolling back of sanctions to a separate announcement that it had made just one hour after the release of the White House decision, saying that Havana will release 533 prisoners held in Cuban jails under a deal brokered by the Vatican.

Although all aspects of the decision are unlikely to be rescinded immediately by the Trump Administration, the US Secretary of State designate, Marco Rubio and incoming senior national security figures indicated that the new administration will not be bound by the decision.

Highlights in this issue: 

• Rubio suggests it may take time to reverse Biden’s decision
• Just six of fourteen sugar mills reported to be grinding in early January
• Despite constraints, new onshore oil exploration to begin this year
• Peso-Dollar street rate climbs as purchasing power of MLC declines
• Vietnamese rice project indicates new Cuban approach to foreign investment

The lifting of the terrorism designation is expected to ease in the short-term,  limitations on the purchase of essential items by the Cuban government and on activities related to Cuban companies involved in tourism, finance, and money transfer mainly linked to the Cuban military-controlled conglomerate, GAESA. Despite this, it is expected that most US and foreign businesses and financial institutions will respond cautiously given the uncertainty over future actions by the Trump administration and the many other aspects of the US embargo which remain in place.

The White House statement appeared  to suggest that the decision may form a part of a wider or longer-term approach involving Cuba and the Catholic Church.

It noted: “In taking these steps to bolster the ongoing dialogue between the government of Cuba and the Catholic Church  …. (and) …. “in appreciation of the Catholic Church’s efforts to facilitate Cuba to take its own, constructive measures to restore liberty to its citizens and enable conditions that improve the livelihood of Cubans.”

20 January 2025, Issue 1263

 The Caribbean Council is able to provide further detail about all of the stories in Cuba Briefing. If you would like a more detailed insight into any of the content of today’s issue, please get in touch.

13 January 2025

Cuba’s Minister of Tourism,  Juan Carlos García, has said that it “is essential for the recovery of the sector” that in 2025 the country has ”a decent tourism product that stimulates demand.”

His comments to a meeting of the National Assembly’s  Commission on Services followed his admission that the sector would close 2024 with 2.2mn visitors, a projected 9.5% decrease on 2023 when the island received 2.4mn tourists. The forecast outcome was the first overall fall in annual arrivals numbers since the end of the COVID pandemic.

Cuba’s National Office of Statistics and Information (ONEI) is expected to publish shortly the detailed annual tourism arrivals figures for 2024. However, its report for the first eleven months of 2024 indicated a 7.9% like-for-like decrease compared to the previous year, with the island receiving 2,005,390 international visitors by air and cruise ship to the end of November. Its figures indicate that for nine of eleven consecutive months, arrivals numbers fell when compared to 2023, suggesting a continuing downward trend.

In his reported remarks to legislators, García said that while the original goal was to receive 4.3mn visitors in 2024 based on the frequency of international flights to Cuba, a decrease in airlift this winter season meant that achieving tourism’s original arrivals target was not possible. 

The problem is expected to continue in 2025. As reported under Europe below, several European airlines have announced they are in the process of reducing or ending services to Cuba. In addition, a key tour operator, Canada’s Sunwing, announced in November 2024 that it was removing 26 hotels from its Cuban portfolio due to quality issues and was reducing flights to the island due to falling demand.

Since the start of 2024, García told legislators, other factors had also affected arrivals numbers, including “a downward trend observed in the destination’s security perception index.” He also pointed to declining arrivals from Europe and elsewhere following the US administration’s decision to declare travellers ineligible to visit the US under its ESTA visa waiver scheme if they had visited Cuba on or after 12 January 2021, other than by applying for a visa.

Highlights in this issue: 

• Government clarifies position on dollarisation
• Libreta guaranteed for 2025 but many Cubans expect value to decline
• Cruise lines seek end to Helms-Burton lawsuit following successful appeal
• Fuel purchase contract with Russia expected to be implemented soon
• Cuba formally approved as a BRICS partner country

The Minister added that 2024 had also been a tough year for tourism, “due to the lack of financing,” insurance related problems, difficulties in obtaining supplies for the sector, the high cost of fuel, and what he described as “the large communication campaign against Cuba.” He additionally attributed the fall in arrivals numbers to domestic issues including fluctuations in the workforce, migration, the cancellation of air operations, power outages, the disconnection of Cuba’s National Electric System, and meteorological challenges.

The decline in the number of visitor arrivals contrasts with the figures published by other comparable regional destinations such as Punta Cana in the Dominican Republic and much smaller Caribbean nations, almost all of which report overall demand and arrivals continuing to rise.

Rise in revenues reported

Despite the fall in visitor  numbers, García claimed that the sector’s revenues in 2024 grew, compared to 2023, while noting that the figure remains below what was anticipated by the country and sector’s economic plan.  However, no details of the sector’s 2024 earnings have yet been published.

In an apparent response to public criticism by Cubans about continuing high levels of expenditure on developing new hotels rather than on addressing the many hardships they face, the minister suggested that during 2024 there had been no investment in any new construction, only work on projects that were already underway.

His remarks were made before the Miami Herald published in early January leaked details of financial records it had obtained which suggested that the Cuban hotel companies Gaviota and Almest, both a part of the military related GAESA group, had billions of dollars in convertible currency in cash reserves.  (See United States below). Although a snapshot, the Herald story alleged that far from being financially challenged, the sector is high earning, and the apparent surpluses rather than being used to address domestic challenges are possibly being diverted for other purposes

Better results hoped for in 2025

In his address to legislators, García spoke about the efforts being made to turn around Cuba’s tourism sector after its lacklustre  performance during 2024.

Looking ahead, the minister said that Cuba hoped to receive 2.6mn foreign visitor arrivals in 2025, an 18% increase over the estimated outcome for 2024. He did not indicate, however, the markets from which he expected the incremental visitor numbers would come.

In doing so, he emphasised in relation to tourism’s recovery, the importance of improving training and work programmes, and having administrative bodies at the municipal level that have devolved responsibilities better understand the needs of the sector. He also noted that courses related to tourism are being undertaken in communities and in relation to agrotourism, with pilot projects underway in the provinces of Mayabeque and Camagüey to identify potential new tourism products to “strengthen the image of international tourism” that Cuba can offer.

As reported previously, visitor arrivals numbers from almost all of Cuba’s leading tourism markets declined in 2024. Canada, the island’s leading market, Cuba’s significant expatriate market, and key  European markets including Spain, Italy, and Germany, all recorded substantial falls during the first eleven months of 2024. Only arrivals from Mexico and Russia experienced significant increases over the same period.

Despite this there are uncertainties about the sustainability of growth in the Russian market.

Recent comments by the Association of Tour Operators of Russia  and Cuba’s Ambassador in Moscow suggest that while Cuba’s potential as a destination for Russian visitors is many times greater than at present, there will continue to be a limit on the number of Russian and Venezuelan operated flights available because of restrictions on the availability of aircraft and spares caused by western sanctions.

This has meant that there are significant constraints on increasing airlift and expanding services from points in Russia other than Moscow, making even proposed new services from St Petersburg problematic. Russian tour operators have also expressed concern about meeting competing demand from the Dominican Republic an already popular destination for Russian visitors.

Continuing western sanctions, the falling value of the Rouble, and negative comments on the Cuban tourism product in some of Russia’s consumer media, and the reported deep discounting of hotel accommodation to Russian tour operators and consolidators for  the summer 2025 season, raise questions about how rapidly the number of visitors from Russia will increase in 2025; let alone when they may eventually reach the hoped for 0.5mn Russian visitors a year that Cuba’s tourism minister is wanting to see in the next few years.

One new market the Cuban authorities are targeting is China, as of May 2024 encouraging travel by Chinese citizens who wish to visit vias free. However, this is likely to be a long term wish with little likelihood of  growth in the near future.

Impact on the economy

Although the sector continued throughout 2024 to be described by senior ministers as the driving force in the economy, the projected arrival figure for 2025 suggests that at 0.1mn fewer visitors than the estimated outcome for 2024, Cuba may struggle to achieve the foreign exchange earnings it hopes for from the sector.  

Cuba’s 1% projected GDP growth for 2025 is in part based on the expected recovery of tourism, according to remarks made to the National Assembly in December by Joaquín Alonso,  the Minister of Economy and Planning.Alonso told delegates at the time that overall income from tourism in 2025 is expected to remain at levels similar to those estimated for 2024, a performance he described as having had “a negative impact on the income-generating capacity of our economy.”

In another striking recent commentary, the Cuban academic and researcher, Professor José Luís Perelló, a leading national expert on tourism at the University of Havana, made clear that despite the optimism shown by the Cuban authorities, Cuban tourism faces new challenges. “If the new Republican Administration keeps its campaign promises, [Cuban tourism] will be in an even more difficult situation between 2025 and 2029,“ Perelló warned. He noted also that “the future of the country will therefore depend only on the ability to promote economic development through other means.“

Perelló’s analysis and concerns, which first appeared in the US published leftist publication, Progreso Weekly, were subsequently reported in a carefully worded report published by Prensa Latina, Cuba’s official news agency.

James Hepple, the Managing Director of Aruba-based Tourism Analytics, believes that Cuba is now likely to face an increasing regional challenge for its market share. He points to another factor that could seriously impact the future development of the Cuban tourism sector. He observes: “The Dominican Republic recently announced its intention to double the number of its tourists it receives from 10mn to 20mn a year. Given the tourism product in the DR is very similar to that of Cuba, one of the ways it can achieve this ambitious goal is by continuing to siphon off tourists from Cuba, especially from the Canadian and European markets”.

06 January 2025

Addressing the closing session of Cuba’s National Assembly, President Díaz-Canel told delegates that Government’s efforts to implement its macro-economic reform strategy will continue “with the aim of changing, in the shortest possible time, the overwhelming situation we are experiencing.”

Observing that “the insufficient results achieved” in 2024 were “reason for the most profound and severe self-criticism,” he told legislators that such failures had to be taken in context. Repeating remarks made at an earlier plenary meeting of the Central Committee of the Communist Party (detailed below), he said that Government is now having to take vital decisions on a day-to-day basis as new circumstances arise.

The cost of the embargo aside, he told the 18 December meeting of National Assembly members, “there are the arduous daily exercises” to decide how to prioritise expenditure and overcome payment delays through established international financial mechanisms. There is tension in the management of each of the issues about which there were justifiable citizen complaints he said, including the delay or fragmentation of the standard family basket, the distribution of milk, bread, liquefied gas and medicines, and basic and essential products for daily life.

Despite this, he suggested that limited but positive signs were beginning to appear in relation to food production, power generation, and the country’s fiscal deficit.

Domestic food production, although not at the desired level or price, he stated, is expected to improve as the areas planted increase, municipal food production develops, and foreign currency allocation schemes are used to stimulate sustainable grain production. In addition, he said,  national rice production strategies will be developed on a commercial basis involving  Vietnamese companies and Chinese advice. Together, improved food production will enable the foreign currency saved to be used to import food and buy inputs that guarantee future levels of production.

Turning to the island’s failing national electrical energy system, Díaz-Canel told legislators that although the results may not be immediate, the investment that is being made in renewable energy will help to create new generating capacity and more optimal use of fuels. Confirming that work is underway on two 1,000 MW projects with 100 MW of storage each, he said that action is also being taken to recover power in distributed generation and thermoelectric plants. He noted also that a foreign currency financing scheme has been approved to support the national oil industry to increase oil and gas production.

Highlights in this issue: 

• Communist Party and National Assembly meetings set scene for a difficult 2025 
• Marrero outlines challenging 2025 reform agenda
• Economy Minister stresses importance of correct sequencing of reforms
• Communist Party hears frank assessment – agrees overriding political objectives for 2025
• Less bureaucratic approach to foreign investment planned

Another positive sign, he suggested, relates to progress with the government’s plans to reduce the fiscal deficit. It is estimated, he said, that 2024 will close with a 46% reduction in the budget deficit, bringing the overall 2024 deficit to CUP90bn,” a figure “much lower than the CUP147bn planned.” This will enable, he said, the government “to work in 2025 with a deficit of CUP88bn.” Cuba’s President noted that the current account outcome for 2024 was “the best of the last five years and the projection for the year 2025 is the best of the decade.”

The progress being made, Díaz-Canel suggested, will make it easier to work in 2025 and  deliver capital expenditure on priority investments including the national electric energy system, the water supply, food production, and science and innovation.

To ensure this happens, he stressed, compliance and social responsibility will be required of all economic actors along with comprehensive fiscal inspection, and the consolidation of banking reforms.

All of which he said will require all public servants to improve their communications to explain the origin, motivation and objectives of each decision or regulation.

In his closing address Díaz-Canel told legislators that while his greatest dream is that one day he will be able to tell them that Cuba had overcome the US embargo and Washington’s designation as a sponsor of terrorism, neither development was likely in the near future.

“The truth is the reverse of that dream: the blockade, its knots and the spurious list have no expiration date. It is the style of empires: to impose punishments and extend them over time,” he told legislators before going on to set out the economic challenges facing the country in the context of the need for a new international order. “No country,” he said, “can live and develop outside the prevailing economic order, especially if it tries to do so with the noose of a genocidal blockade.”

Describing the Cuban people as heroic,  free, and sovereign, he concluded that Cuba would continue to weather “storms under fire without giving up” because “we are still better than our enemy.”

06 January 2025, Issue 1261

 The Caribbean Council is able to provide further detail about all of the stories in Cuba Briefing. If you would like a more detailed insight into any of the content of today’s issue, please get in touch.

09 December 2024

The Central Committee of Cuba’s Communist Party (PCC) has said that it will convene on 12 and 13 December in plenary, to  analyse “vital issues of the Cuban economy and society, in the midst of the complex scenario that the country faces.”

The announcement followed a meeting of Cuba’s Council of Ministers during which participants suggested that the country’s macro-economic reform process is only advancing slowly and that it will take more time to relaunch the Cuban economy

The December 5 announcement by the PCC noted that compliance with the Government’s projections to correct distortions and boost the economy, the draft Economic Plan and Budget for 2025, attention to state and non-state economic actors, and actions to address deviations and negative trends in current Cuban society will be the focus of attention. 

It ended with the line “The meeting will confirm the Party’s leading role in ensuring and leading the country’s main programmes and priorities.”

Cuba’s National Assembly is due to meet shortly afterwards, from16 to 18 December. Full coverage of the Communist Party’s plenary and the National Assembly meeting will appear in our next issue.

Official reporting of Cuba’s Council of Ministers meeting, again laid stress on the need to continue with efforts to address the country’s budget deficit if the island is to achieve economic growth through the delivery of the reforms agreed in December 2023 (Details Cuba Briefing 2 January 2024).

A report on the Presidency website indicated that at their 2 December meeting, senior Ministers laid stress on “continuing to seek and exploit the reserves that still exist in the territories, to increase as much as possible income to the municipal budget and reduce unnecessary expenses.”

Presenting details of progress made up to the end of October, the Minister of Finance and Prices, Vladimir Regueiro Ale, told colleagues that the budget deficit stood at CUP29.72bn or 20% of the deficit planned for 2024 and 39.6% of what had been expected at that date.

Highlights in this issue: 

• Aviation fuel shortage resolved, averting potential crisis for tourism
• Coming sugar campaign expected to be particularly challenging
• New resolution ends private sector’s role in wholesale trade
• Cuba stresses importance of continuing co-operation with US on migration issues
• Díaz-Canel  thanks China’s visiting Public Security Minister for cybersecurity support

The report provided no detail as to the extent to which the ten-month outcome had resulted from cutting public expenditure or through increasing revenues. However, most analysts believe that it is a significant reduction in expenditure and austerity that has played the most significant role, causing new hardship for most Cubans. Notwithstanding, Ale noted that the result confirmed that “the reduction of the fiscal deficit has had a sustained behaviour throughout the year,” and that at the end of October the current account showed a positive balance of CUP19bn.

Without citing any figures, the meeting report indicated that budgetary adjustments, reductions in expenditure, and  increases in income, had enabled better results to be achieved in areas “that have a positive impact on the reduction of the fiscal deficit.”

Addressing fellow Ministers about the pace of progress, Joaquín Alonso, the Minister of Economy and Planning, was noticeably more downbeat, reportedly detailing several indicators whose results, “confirm the complexities that the country is currently facing” in relation to imports of goods, foreign currency earnings from exports, power distribution, and freight and passenger transportation.

“Despite this reality, the truth is that there are still signs of an ordering of macroeconomic issues,” Alonso was reported to have said, before suggesting  to Ministers that the process was only “gradually advancing towards the expected result.” 

In doing so, he said only that there was a “tendency towards a decrease in inflation, both monthly and year-on-year, as well as the reduction of the fiscal deficit, the behaviour of the current account, and the indicators of monetary circulation.” 

Alonso added that while measures to control inflation through inspections and price caps were achieving a reduction in prices and were a positive sign in the macroeconomic reordering process, this was “still insufficient.”

Also speaking, the First Deputy Minister of Economy and Planning, Mildrey Granadillo de la Torre, was quoted as repeating comments she had made at a recent meeting of the Council of State (Cuba Briefing 25 November 2024), saying that: “We are beginning a decisive stage to take stock of what has been achieved and also of what remains to be done” before deciding on the next steps “to correct distortions and relaunch the economy.”

In her remarks she said that during  October the emphasis had been on the development of a schedule to regulate financial flows and access to foreign currency, the monitoring and control of the banking process, implementing maximum prices for the sale of the six products in high demand by the population, and on taking forward actions aimed at “advancing the principle of subsidising people and not products.”

More generally, the Council of Ministers meeting addressed a range of domestic issues from agriculture, the coming sugar campaign, to productivity, the regulation of religious bodies and friendly societies, and several pressing social issues.

The meeting was notable for the second reference in a week to the issue of nuclear power generation. The official report indicated that one of three draft Legislative Decrees to be sent by ministers to the Council of State for approval related to the use of nuclear energy. 

In this respect the official report noted: “it was explained that [the proposed law] establishes the pillars and principles that govern the use of nuclear energy in the country, while reinforcing the peaceful nature of its use and of ionizing radiation in Cuba, through an explicit provision that prohibits the proliferation of nuclear weapons, thereby responding to international commitments assumed by the Cuban State.”

As Cuba Briefing reported last week,  among the issues discussed recently in Vienna between Deputy Prime Minister, Eduardo Martínez, and Rafael Grossi, the Director General of the UN’s International Atomic Energy Agency (IAEA), was  “the organisation’s work platform related to the study and evaluation of the use of small modular reactors for electricity generation.”

09 December 2024, Issue 1260

 The Caribbean Council is able to provide further detail about all of the stories in Cuba Briefing. If you would like a more detailed insight into any of the content of today’s issue, please get in touch.

Cuba Briefing is now taking its annual Christmas and New Year’s break. The next edition will be published on 6 January 2025.