The Cuban Economy

On June 7 we met with economist Gladys Hernández to talk about the Cuban economic situation and the effects on the Cuban economy by the US trade embargo. One of the first things that Mrs. Hernandez said to us was that Cuba and the US do have a relationship, but it is a love hate relationship. The effects on Cuba from the United States and vice versa go way back from when The US won Cuba from Spain as a spoil of the Spanish-American War. Nowadays many Cubans jokingly say that the second largest city in Cuba and almost every Cuban we met has some sort of relative in the United States. Because of such a large populations of Cubans living in the US remittances are big businesses making up about 2% of Cuba’s GDP. Many Cubans live off of the money they receive from relatives in the US. Cuba also had close relations to other socialist countries during the time after the revolution up to the ending of the eastern European socialist block. There was a time when Cuba received 98% of its oil, 75% of its food and 80% of its spare parts from the socialist block. Obviously once the Soviet Union ended in 1991 this affected Cuba greatly when these things no longer came to the island, between the years of 1991 and 1994 the Cuban economy decreased by 40% because of the lack of materials. During this time as well there was a large increase of Cubans crossing the Florida straits by any means necessary to get to the United States for a better life. During this time the Cuban government decided that instead of changing from the socialist model they would focus on areas such as Sugar production, Agriculture, Mining, Fishing and Biotechnology. Biotechnology being the most interesting and productive and in 2006 this sector had a 11% growth. Learning more about the complexities of the Cuban economic system and its relation to the United States was very interesting and really made our time there so much more impactful.