Residents of Havana are undergoing the most profound economic overhaul on the island since the 1959 revolution, even as a stringent U.S. fuel blockade threatens to stifle recovery before it can take root. Last month, Cuban Prime Minister Manuel Marrero Cruz declared that 158 new economic and social measures—pulled from a 176-point package approved by the National Assembly—are officially rolling out across the country, backed by 197 legal decrees. Truthout reported that these sweeping reforms permit private businesses to import essential goods like medicines, loosen restrictions on private tourism, and authorize privately owned banks under Central Bank supervision.
Direct Foreign Investment and the Expanding Private Sector
For the first time since the revolution led by Fidel Castro, the National Assembly has permitted foreign capital to invest directly in Cuban private businesses, removing the mandate to operate exclusively through state-controlled structures. Private companies on the island are no longer restricted to a maximum of 100 employees. London-based Cuban economist Daniel Torralbas calls this legislative pivot the most profound economic reform programme on the island.
Mauricio Alonso, a 68-year-old former nuclear engineer living in Havana who now runs an Airbnb rental, is embracing the changes. “On a personal level this is going to benefit me,” Alonso said, explaining that it allows self-employed citizens to partner directly with foreigners and streamline collaboration with travel agencies. During the 1980s, Alonso worked at the Central Electronuclear de Juraguá near Cienfuegos, a nuclear power station built with Soviet assistance that ground to a halt when the Soviet Union collapsed in late 1991. When work stopped completely in 1992 amid intense pressure from the U.S. government, Alonso eventually shifted to the private sector and started renting rooms.
The Stranglehold of U.S. Sanctions and Energy Deficits
Despite these newly minted reforms, Cuba’s broader economy remains hobbled by severe external shocks. Following a 10.9 percent contraction in GDP during 2020 as COVID-19 shut down international tourism, the island suffered under the Trump administration’s tightening fuel embargo. When U.S. President Donald Trump targeted Venezuela’s oil shipments to Cuba—which previously approximated 26,500 barrels per day—fuel availability plummeted. On January 29, the White House formalized these oil sanctions via Executive Order 14380, establishing a mechanism to penalize third countries supplying crude or petroleum products to Cuba with steep U.S. tariffs.
The human cost of the resulting energy crisis is stark. Amalia Díaz Pérez, a 21-year-old recent philosophy graduate from the University of Havana, watched the fuel blockade disrupt her final academic year. “The total blockade of fuel imports — with only one ship arriving in nine months — caused public transportation to disappear and reduced daily electricity availability to a minimum,” Díaz Pérez told Truthout. UN human rights chief Volker Türk noted that children are dying because doctors lack access to essential medical supplies and medicines.
International Partnerships and the Fight for Economic Sovereignty
To bypass these bottlenecks, Cuba is forging targeted trade and supply agreements with international partners like Vietnam and China. In June, Vietnamese Foreign Minister Lê Hoài Trung visited the Mariel Special Development Zone (ZEDM), where Vietnam has the second-largest foreign business presence, to solidify accords spanning agri-food production, renewable energy, and banking. Concurrently, the Vietnamese rice producer AgriVMA collaborated with Los Palacios in the Pinar del Río province on “rice cultivation across over 1,000 hectares, providing seeds, fertilisers, pesticides, machinery, and technical assistance to Cuban farming households.” As reported on Cuban state media, in 2026, 900 hectares of rice have been planted.
China has similarly expanded its role as a key equipment supplier rather than a direct investor. Cuban economist Ricardo Torres, a visiting scholar at American University in Washington, points out that the island pays for Chinese hardware—such as 5,000 solar systems delivered by August and at least 34 operational solar parks utilizing Chinese technology—primarily with locally produced nickel. Yet, Deputy Prime Minister and Minister of Foreign Trade Óscar Pérez-Oliva cautioned in September that while the policies could yield short-term impacts, their true scope remains difficult to project under persistent U.S. pressure.
Argentine journalist Gabriel Vera Lopes, reporting from Havana, noted that the current crisis is the deepest since the revolution took power, pointing to the departure of long-standing foreign hotel and mining operators following the latest round of U.S. sanctions aimed at cutting off the state’s remaining avenues of foreign currency and social cohesion.
