Assessing the conundrums of the Cuban economy under the revolution (1959–2019)

Abstract

This article evaluates the resilient challenges faced by Cuba’s economy during the six decades of the Revolution (1959–2019), mainly its historical external economic dependency upon a foreign country (the USSR and Venezuela) and the adverse consequences that occur when such relationship ends or deteriorates. Several hypotheses address that issue as well as others such as the hindrance of the US embargo/blockade aggravated by Donald Trump’s punitive sanctions and Cuban continuity of a centrally planned economy and predominance of state enterprises over the market and the non-state sector. The core is an analysis of performance of key economic indicators: GDP growth, gross capital formation, financial stability, mining-industry- agriculture output, tourism and exports of professional services. Hypotheses are tested with long-term statistical series elaborated and scrutinized by the author over half a century based on Cuban official sources, as well as legislation, articles by Cuban scholars and from news media. Among the results: external dependency has declined somewhat but demands deeper economic reforms, there are no countries currently capable and willing to fully replace Venezuela’s substantial aid, the ongoing crisis provoked by the deteriorating Venezuelan economy cum Trump’s sanctions should have lesser adverse effects than the 1990s crisis that resulted from the USSR disappearance. The article is a significant contribution to the study of Cuba’s external economic dependence and its consequences, and should be also worthy for other small economies and socialist countries.