Living under communism is like the movie Groundhog Day: You just repeat the same poverty, hunger, repression, and misery day after day, year after year, decade after decade.
Cuba 2020: The return of the special period
After months of silence from officials, Cuba’s Economic Minister finally admitted on December 17 before the National Assembly that the island’s GDP had contracted 11% in 2020. The decrease is larger than what CEPAL had forecasted in its last report, Preliminary Balances in Latin American and Caribbean Economies for 2020. The collapse of the Cuban economy has been more intense that it was during the years of the special period. In addition, it coincides with a series of issues that seriously complicate efforts to escape the crisis.
One of those issues is that the Cuban economy was already in bad shape before it collapsed in March due to the COVID-19 pandemic. During the same session, the minister anticipated what everyone already knew, but no one expected an official confirmation. The Cuban economy in 2019 was also already contracting, in this case by 0.2%, a figure that was also distinctly different than the one published by CEPAL, which forecasted an increase of 0.5% that year.
The data confirms the Cuban economy quickly devolved from positive growth in 2018, which was estimated at 2.2%. Nevertheless, throughout 2019, and above all starting in the last third of the year, the economy went into recession, producing the final figure cited by the minister. The Cuban economy has remained that way for a year and a half with the GDP dropping, prolonging the recession and provoking more than a few problems in keeping both internal and external equilibrium.
It becomes evident that such conditions explain the deterioration in the economy seen in 2019. From external factors such as reduced petroleum shipments from Venezuela or lower then expected growth in tourism reducing the amount of hard currency to exports, it is necessary to analyze the results the Cuban regime’s economic policies in order to deal with the economic situation. Among those analyses, paying attention to the data the government itself does not recognize but nonetheless, are essential to understanding what is going on with the economy.
If such an analysis is made, it will likely conclude that the measures adopted by authorities were not adequate since they were not able to stop or reverse the economic recession.
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