Cuba's Economy Faces Steep Contraction Amidst Energy Crisis and...

Qué pasó

A new forecast from The Economist Intelligence Unit (EIU) projects a significant contraction of Cuba's Gross Domestic Product (GDP) by 7.2% for 2026. This projection was described as "very strong" by Cuban economist Mauricio de Miranda Parrondo.

De Miranda suggested the actual economic downturn could be even more severe, considering recent performance in key sectors and the absence of fundamental structural reforms.

Dónde y cuándo

The EIU forecast was published in February 2026. The economist's commentary was diffused on Friday, March 14, 2026. This analysis addresses the current economic situation affecting the entire island of Cuba.

The economic decline in Cuba predates the pandemic, with official reports indicating a contraction of approximately 5% in 2025, marking three consecutive years of economic recession and a cumulative fall of over 15% since 2020.

Por qué es importante

This projected contraction, if realized, would mean Cuba's economy has shrunk by about 23% since 2019, a substantial decline over just seven years. Such a severe downturn impacts the daily lives of Cubans through shortages and reduced services.

The situation is aggravated by the halt in oil supplies from Venezuela, crucial for daily energy needs, leading to prolonged blackouts. The severe slump in tourism and the termination of cooperation agreements also contribute to this precarious economic state.

Qué dicen las partes

The EIU provided the initial projection. Economist Mauricio de Miranda Parrondo offered a critical analysis, labeling recent government measures like Decree 114 as "patches" lacking systemic coherence. He also noted the presence of Raúl Guillermo Rodríguez Castro in official meetings, suggesting a "de-institutionalization" of decision-making.

Reports highlight a complex economic scenario with energy crises, production stagnation, and losses in traditional sectors like tourism and the sugar industry, which is at historically low output levels.

Qué viene ahora

De Miranda concluded that without deep reforms and lasting structural changes, Cuba's economy is unlikely to see improvement under the current political conditions. The lack of a clear path forward suggests a prolonged period of economic deterioration for the island.