Cuba has approved its largest economic reform since the 1959 revolution, in a move designed to open the socialist economy to more market forces. The 176 measures are meant to decentralize the island’s planned system, which has been hit hard by the tightening U.S. embargo under President Donald Trump.
The reforms roll back many state controls over production, prices, and resource allocation. They expand space for private businesses, allow imports and exports without government intermediaries, permit freer hiring, and open the door to private banks, investments by Cubans living abroad, and even fast-food chains entering the island.
Luis Carlos Batista, a Cuban-American political scientist and lawyer, said pillars of the revolutionary model, including the state monopoly on foreign trade and centralized control of production, have now been dismantled. Cuban leaders, including former president Raul Castro, have tried smaller reforms before, but those efforts were slowed by bureaucracy. Officials in Havana warned that implementation may be slow and said the changes will not work unless the United States lifts its energy and financial embargo.
Since January, Cuba has been under a severe U.S. energy and financial blockade that cuts it off from its main energy source and deepens a crisis already in its fifth year. Blackouts last up to 20 hours a day and disrupt healthcare, transportation, and education. Trump and Secretary of State Marco Rubio said they are maintaining maximum pressure to change the island’s political and economic system, and have not ruled out military force. Miguel Diaz-Canel said the package draws on the Vietnamese and Chinese models, while Raul Guillermo Rodriguez Castro said Cuba is seeking a “very Cuban” economic model, one that diversifies business and investment.
