The Cuban government's narrative that "a thriving tourism industry will generate revenue, employment, and development" is being challenged by recent analysis from Cuban economist Pedro Monreal. His findings reveal that the strategy is not only failing, but it is also dragging the sector and the people further into poverty.
Despite the collapse of international tourism in Cuba, the regime continues to pour money into constructing new hotels. These multimillion-dollar investments seem more aligned with benefiting state corporations rather than meeting demand or pursuing sustainable development. Monreal highlighted this in a series of posts on the social media platform X, criticizing the rapid expansion of the Ciego de Ávila tourist hub, which quadrupled its capacity in just two years. He described this as an example of a business model that places corporate interests above social welfare.
Strategic Assets Over Social Welfare
Monreal explained that the real estate business model views hotels mainly as investment vehicles that generate profits for investing entities, mostly Cuban corporations, by leasing "their" assets operated by others. This approach prioritizes maximizing asset yields through "strategic positioning (exclusive location, branding), monopoly, and state 'assistance'," rather than focusing on genuine economic development through tourism.
Furthermore, he noted that construction contracts are often awarded "turnkey" to foreign entities, and international chains handle the tourism operations, indicating that managing tourism activities internally is not a priority for the country.
Investment Without Returns
Official data from the Cuban government underscores the stagnation and decline of international tourism. According to the National Office of Statistics and Information (ONEI), 1,306,650 travelers visited Cuba by June 2025, which is 319,654 fewer than the same period in 2024. The decline is even more severe in terms of international visitors: 981,856 by June, a 25% drop (327,799 fewer tourists). Key markets like Russia and Canada saw significant reductions in visitor numbers.
Monreal warned that tourism-related investments in Cuba have exceeded the revenue generated by the industry. This suggests that tourism investments draw resources from other sectors, allowing "national state corporations to consistently benefit from 'extra' investment funds (via the state budget) and fiscal and customs advantages."
Who Really Benefits from Hotel Construction?
Statistics from ONEI support this critique. In the first quarter of the year, hotel occupancy was a mere 24.1%, meaning more than 75% of the infrastructure remains unused, even during peak season. Overnight stays decreased from over 5 million to just 3.6 million, and tourism revenue fell by 21.5%. Meliá, a major hotel chain on the island, reported a 20.8% drop in revenue per available room and an average occupancy of only 40.5%.
Monreal stated, "International tourism did not occupy even a quarter of the hotel capacity in the first quarter. This result is worse than in 2024 and contradicts the official recovery narrative."
Despite this outlook, the regime continues to push for new tourist constructions. For the economist, "the advancement of a tourism real estate 'business model' in Cuba seems to be associated with an unfavorable investment pattern for development, unlikely to change due to the 'protection' afforded by political connections and corporate opacity."
The Diminishing Allure of Cuba's Socialist Paradise
The decline in tourism is not only explained by numbers. On social media, Cubans are responding candidly to the official rhetoric. A recent article by Cubadebate questioned whether "the engine of the economy had stalled," prompting numerous users to expose the real reasons tourists are no longer choosing Cuba.
"Don't they realize that tourists are human, and who wants to go to a country without electricity, where people are bitter?" one user asked. Another added, "Our joy is fading... Tourists seek human warmth, Cuban empathy, the joy in the streets, and that's gone. They encounter a disgusting scene, there's stench, garbage on every corner, sewage water..."
Some accounts reflect personal experiences in hotels lacking basic products, such as eggs for breakfast, and where workers are exhausted by poor living conditions.
The stark contrast between the substantial investment in empty hotels and the country's deepening crisis has led many to question: Who truly benefits from building hotels in a country without tourists? According to Pedro Monreal, the answer lies not in the real economy, but in a corporate logic that prioritizes real estate capital, state monopoly, and opacity over any criteria of sustainability, efficiency, or collective benefit.
Understanding Cuba's Tourism Crisis
Why is the Cuban government investing in new hotels despite low tourism rates?
The government continues to invest in hotel construction to benefit state corporations, focusing on real estate investment returns rather than actual tourism demand or sustainable development.
How does the current investment strategy affect Cuba's tourism sector?
The strategy prioritizes corporate gains and asset yields over genuine economic development, contributing to the stagnation and decline of Cuba's tourism industry.
What impact does low hotel occupancy have on Cuba's economy?
Low hotel occupancy leads to underutilization of infrastructure, resulting in decreased tourism revenue and a waste of investment resources that could have been allocated to other sectors.