AFP, Havana :
Cuba is undergoing a paradigm shift: after decades of tight, centralized control, the communist government is opening up the bulk of its economy to the private sector.
While economic decline and spiralling unemployment are the main drivers, analysts say the liberalization measures can also be seen as an overture to a new US president.
“It is definitely a strong signal at a crucial moment when the US administration has said it is revising the policies of (Donald) Trump towards Cuba,” said Ricardo Torres, an economist at the University of Habana.
Six decades of US sanctions, toughened during Trump’s term in office, have claimed a heavy toll on Cuba’s economy, worsened by the coronavirus crisis and a steep drop in tourism, a critical sector.
Last month, Havana said Trump’s sanctions cost the country some $20 billion, adding that “the damage to the bilateral relationship during this time has been considerable.” The Cuban economy shrank 11 percent in 2020, and exports declined by 40 percent.
At the weekend, the government in Havana announced it would authorize private enterprise in a bid to boost its economy and create jobs, though limited to individual entrepreneurs for now, not businesses.
The number of authorized private activities would grow from 127 to over 2,000, but excludes 124 sectors including the press, health and education, which remain in government hands.
Cuba is undergoing a paradigm shift: after decades of tight, centralized control, the communist government is opening up the bulk of its economy to the private sector.
While economic decline and spiralling unemployment are the main drivers, analysts say the liberalization measures can also be seen as an overture to a new US president.
“It is definitely a strong signal at a crucial moment when the US administration has said it is revising the policies of (Donald) Trump towards Cuba,” said Ricardo Torres, an economist at the University of Habana.
Six decades of US sanctions, toughened during Trump’s term in office, have claimed a heavy toll on Cuba’s economy, worsened by the coronavirus crisis and a steep drop in tourism, a critical sector.
Last month, Havana said Trump’s sanctions cost the country some $20 billion, adding that “the damage to the bilateral relationship during this time has been considerable.” The Cuban economy shrank 11 percent in 2020, and exports declined by 40 percent.
At the weekend, the government in Havana announced it would authorize private enterprise in a bid to boost its economy and create jobs, though limited to individual entrepreneurs for now, not businesses.
The number of authorized private activities would grow from 127 to over 2,000, but excludes 124 sectors including the press, health and education, which remain in government hands.
