Facing an unprecedented energy crisis and the near-collapse of tourism, Cuba has abandoned a centralized economic model it has used for more than 60 years and approved a sweeping 176-point emergency reform plan. Prime Minister Manuel Marrero Cruz presented the package to the National Assembly, saying it is meant to rebuild the country’s economic foundations. He insisted the restructuring does not mean the end of Cuban socialism, but it does open major sectors to private and foreign investment for the first time in generations.
The move will allow outside capital into real estate, banking, gas stations, and restaurants, and officials said international fast-food chains, including American brands such as McDonald’s, could gain access to the Cuban market. The government is trying to pull the island out of a financial spiral after prolonged blackouts, worsening heat-related living conditions, and a severe shortage of foreign currency tied to the collapse of tourism.
The tourism industry, long Cuba’s economic lifeline, has been hit hard by U.S. sanctions targeting the military conglomerate Gaesa, which controls much of the country’s hospitality sector, including the Gaviota hotel chain. Havana’s pivot to alternative partners has also failed, with only 250 Russian tourists arriving in March 2026, down from more than 11,000 a year earlier. Canada’s market has also almost disappeared because fuel shortages make regular flights difficult.
The pressure intensified after the United States halted oil deliveries in January, following the arrest of Venezuelan President Nicolas Maduro, worsening Cuba’s power grid crisis. American pressure also included a May Justice Department indictment of former president Raul Castro over the 1996 shootdown of two Brothers to the Rescue aircraft, followed by the late-May deployment of the USS Nimitz and escort ships near Cuba. Analysts say the combination of sanctions, legal action, and visible naval force helped force Havana into the dramatic policy shift.
