Cuba's Economic Shift
Cuban President Díaz-Canel Unveils Broad Economic Reforms to Liberalize Economy
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Cuban President Miguel Díaz-Canel surprised the world Friday with a sweeping package of economic reforms, declaring that "these are times when we must change." The announcement came on state television at 8:44 AM, just one day after the U.S. imposed new sanctions on Cuba's state oil company CiberCuba.
The reforms mark Cuba's biggest economic shift in decades. They give local governments and state companies new freedoms to trade, manage money, and attract investment. The move comes as up to 67% of the island suffers simultaneous blackouts and the tourism sector has nearly collapsed El Periódico.
A Crisis Decades in the Making Forces Cuba's Hand
Cuba's economy has been in freefall. Major hotel chains like Blue Diamond and Meliá pulled out of the island in early 2026 to avoid U.S. Treasury sanctions. Iconic Havana hotels now sit nearly empty Diario de Mallorca. The military conglomerate GAESA still controls about 40% of the entire economy, leaving little room for private growth.
Energy shortages have become desperate. The government converted 700 bakery ovens across the country from electric or gas to charcoal and wood just to keep bread production going El Periódico de Aragón. On June 11, the Trump administration imposed new sanctions on CUPET, Cuba's state oil company, blocking all its U.S. property interests. Díaz-Canel made his announcement the very next morning.
What the Reforms Actually Change for Cubans
The package has three main pillars. First, municipalities can now import and export directly, without going through the central government. Local governments can also manage their own foreign currency and attract investment from the Cuban diaspora abroad Levante-EMV.
Second, state-owned companies get new freedoms. They can now set their own salaries, pick their own suppliers, and trade directly in the foreign exchange market. Third, a new land law raises the limit for private farm use to 268 hectares for livestock and rice, with land leases extended to 25 years. Private property ownership stays capped at 67.10 hectares La Provincia.
Díaz-Canel Insists This Is Smart, Not Surrender
Díaz-Canel was clear that the reforms are not a response to pressure from Washington. "The country is not at a standstill," he said. "Our response must be one of unity." He framed the changes as Cuba studying the models of Vietnam and China — economies that opened markets while keeping the Communist Party in power El Día.
U.S. Senator Marco Rubio countered on X that the American goal is a "new future for the Cuban people" by targeting the regime's ability to trade energy. Cuba expert William LeoGrande warned that U.S. pressure risks "triggering mass migration," noting Cuba's private sector currently lacks the infrastructure to replace state monopolies La Opinión de Zamora.
Critics Call It Too Little, Too Late
Opposition voices and exile outlets are not convinced. They point to the 700 charcoal-burning ovens as proof the revolution has failed, not evolved. They argue opening hotel management to Russian or Chinese groups is not reform — it is replacing one dependency with another LNE.
The reforms still need formal approval. Cuba's National Assembly is scheduled to vote on the measures in July 2026. Even if passed, experts warn that decentralizing power to municipalities could create a two-speed economy — with wealthy areas like Havana recovering while poorer inland regions fall further behind Información.
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