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• Society
• Business and Economy
• Politics and Government
• 03 / 06 / 2019

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According to the Miami-based consultancy, The Havana Consulting Group, Cuba could fall in 2019 into a new "special period," just as it happened in the 1990s on the island.

According to the report, Cuba "urgently needs" to open up to the market economy, "to free once and for all the productive forces and allow Cuban citizens to invest in their own country," or, on the contrary, the "reappearance of the phantom of the 'special period' "will become a fact.

Emilio Morales, president of this consultancy that helps to understand the Cuban market and its consumers, the worsening of the Cuban economy is observed not only in the "shortage in dollarized stores", but in the lack of subsidized products of first necessity like bread and eggs.

They make a parallel between the relations between Cuba and the Soviet Union in the 90s, and the current relations of the Island with Venezuela, a country that is immersed in a great humanitarian crisis and that has been the "financial support" of Cuba.

Morales said that the Venezuelan subsidy for twenty years "has helped the battered Cuban economy survive," with the subsidized delivery of billions of dollars in barrels of oil in exchange for mainly medical services.

The Havana Consulting Group said that only by "avoiding the usual dependence on third parties" and undertaking "deep transformations of its economy" will Cuba be able to overcome the crisis on its own.

If the commercial exchange between both countries managed to reach 8,500 million dollars in 2012, today barely reaches 2,000 million, representing a fall of 74%.

In addition to the tense situation for the oil country, the "failure of the economic reforms undertaken by Raúl Castro" about a decade ago and the "decrease in exports of nickel and sugar", to the point that sugar production in 2018 was 16.3% lower than in 1905, which forced the country to buy it in France.

On the other hand, there is the factor of the "limits imposed to prevent the development and expansion of the private sector", the "non-recognition of private property, the prevalence of the monopoly established 60 years ago and the lack of opportunities to invest and commercialize goods and services that Cubans have. "

According to the consultancy, she considers the deficit of the Cuban economy as another major problem, "despite the opening of the Mariel Special Development Zone (ZEDM) and its failure to attract capital, which barely reaches 14.2% of the goal proposed since that was created six years ago. "

Another blow to the Cuban economy has been the issue of tourism, with the decline of the main markets for tourists: Canada, the United States, Germany, England, France, Spain and Italy, he says. The fall of tourism resulted in an estimated loss of 1,283 million dollars.

According to the report, "if the Cuban economy has not collapsed, it has been thanks to the Cuban exile", and the remittances that contribute around 7,000 million dollars annually to the Island.