Cuban SMEs Stifled by Lack of Chamber and Independent Union

The recent meeting between Miguel Díaz-Canel and so-called "representatives" of Cuba's private sector has highlighted a significant structural contradiction: while the regime has expanded regulations for small and medium-sized enterprises (SMEs), it has failed to establish the necessary institutions for these businesses to operate effectively.

Economist Pedro Monreal, through his social media presence "The State as Such," raised critical questions that the official report of the meeting did not address: "What regulations define their legal status and govern their selection, mandate, and accountability? Do they represent owners, workers, or both?"

Monreal suggests two specific measures to bridge this gap: establishing a dedicated chamber of commerce for SMEs and allowing the formation of independent unions separate from the Central de Trabajadores de Cuba (CTC), with voluntary membership and genuine collective bargaining power.

Need for Specialized Representation

The proposal for a business representation stems from a clear fact: in 2023, the Chamber of Commerce of the Republic of Cuba had 1,226 affiliated companies, only 303 of which were SMEs. This institution was originally designed to handle state foreign trade, not to represent the unique interests of an emerging private sector.

"A chamber of commerce specifically for SMEs would not replace the existing Chamber of Commerce of the Republic of Cuba; it would complement it. Its role would focus on amplifying the voice, services, and dialogue according to the needs of a sector that requires its own business representation. Without a collective voice, their legitimate demands are lost," Monreal's analysis notes.

Labor Representation Challenges

The argument for labor representation is equally straightforward. Since the legalization of SMEs under Decree-Law 46 in August 2021, over 10,000 units have been approved, creating a fundamentally different employment relationship than in state enterprises: there is a profit-driven private employer and workers who need to protect their wages, rest, and job security.

However, the CTC was designed with a "unity" philosophy between business management, the Communist Party, and labor organizations, which only makes sense within the state enterprise model, Monreal explains.

In October 2024, the CTC established specific union structures for the private sector—bureaus and union sections in commerce, gastronomy, and services—but without changing its centralized control.

The new Labor Code, approved on August 22—just three days before Díaz-Canel's meeting with the private sector—includes SMEs in a unified labor framework for the first time and introduces new policies such as mandatory unemployment insurance for private employers. Yet, it maintains the CTC's union monopoly and does not recognize the right to strike or independent unions.

Incomplete Model for Economic Reform

Monreal's analysis concludes that this leaves the model incomplete: "There are entrepreneurs, but no institutionalized labor counterpower."

"SME workers need to defend their wages, rest, security, and stability against their private employers. This defense isn't 'political opposition,' nor can it be replaced by CTC union sections within SMEs, as the CTC primarily serves to align workers with state enterprises," the text argues.

In June 2026, 176 economic measures were approved, removing the cap of 100 workers per company, lifting the restriction of one company per person, and opening new sectors to private participation, including banking and exchange houses. However, the institutional framework for representation did not keep pace.

"If SMEs are to become a stable player in the reformed economic model, the relationship between workers and private employers demands adequate labor representation: a union that isn't an extension of private management or a 'transmission belt of the PCC,' but a true representative of the private enterprise's workforce," the analysis concludes.