Cuba entered 2024 facing a severe economic crisis characterized by unprecedented inflation, currency devaluation, and widespread hunger.
These challenges have compelled the government to implement strategies to “correct distortions” and boost economic activity.
As the nation marked 65 years since the Revolution on January 1st, President Miguel Díaz-Canel Bermúdez voiced optimism for 2024, despite daunting challenges.
In the recent National Assembly session, Vice Prime Minister and MEP head Alejandro Gil Fernández reported a 1% to 2% decrease in Cuba’s 2023 GDP.
This downturn defied the initial 3% growth projection.
Contributing factors included limited foreign currency and fuel access, unexecuted economic programs, U.S. sanctions, inflation, global conflicts, and domestic inefficiencies.
The MEP forecasts the fiscal deficit to surpass 15 or 18% of the GDP, with inflation reaching 30% in 2023. Notably, agriculture prices soared by 72%.
For 2024, the government has launched one of the largest macroeconomic adjustment plans in decades, aiming for approximately 2% GDP growth.
This growth is expected to stem primarily from a rebound in tourism and revitalization of production and services.
Beginning January 1st, a macroeconomic stabilization program was initiated.
It involves reducing tariffs on intermediate products while increasing them on finished goods to promote domestic production.
Additional measures will be phased in, including charging tourists in dollars for fuel and adjusting local prices.
Gil Fernández stressed that these reforms are not neoliberal but rather aim to foster economic recovery.
He acknowledged the risks and implications of each measure, necessitating a comprehensive approach.
The government and the Central Bank of Cuba are also contemplating an adjustment to the official exchange rate.
This change could influence inflation, marking a significant shift in Cuba’s economic policy during these challenging times.
More: Cuba news in English, every day from The Rio Times.
This article was produced by The Rio Times’ automated AI newsroom. Editorial responsibility: Matthias Camenzind, Publisher and Editor-in-Chief. The Rio Times also runs Ask Rio Times, which answers from 100,000+ of our own articles, the daily Latin America Power Map, and prediction-market odds on elections and markets.. How we use AI · Report an error
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