Cuba in crisis: economy is shrinking, inflation is rising - empty supermarket shelves and shortages prevail.

Cuba in crisis: economy is shrinking, inflation is rising - empty supermarket shelves and shortages prevail.

According to a report by www.morgenpost.de, Cuba is in a growing economic and social crisis. Empty supermarket shelves, cheap gasoline and electricity prices, and shrinking agricultural production have left the Cuban population in a situation of poverty and desperation. The official estimates showed a contraction of the Cuban economy of two percent in 2023, accompanied by inflation of 30 percent. The massive state aid was also cut at the beginning of 2024, which further aggravated the situation for the population.

This situation is not only the result of external factors such as the tightening of the US embargo and the impact of the pandemic, but also the government's own mistakes. The gradual collapse of the island economy is also caused by the clinging to an outdated command economy model and the state monopoly on industries and markets.

The drastic price increases for gasoline, electricity and liquid gas as well as the reduction of state allocations on the “Libreta” rationing card will further worsen the situation of the population. This could lead to increased emigration and social unrest. Cuban economist Pavel Vidal emphasizes that the lack of political willingness to make the necessary changes is the main cause of the ongoing crisis.

This ongoing crisis is also expected to have a negative impact on the financial industry and market in Cuba. Further deterioration is expected, particularly with regard to investments, gross domestic product and the unemployment rate. Cuba's economic recovery will be difficult without fundamental structural reforms and an opening to the private sector.

The impact of the crisis in Cuba on the entire region and on the international economy cannot be ignored either. Rising migration and social unrest could have a destabilizing effect in other Latin American countries. It is expected that the international community will increasingly mobilize its aid and support to the Cuban people in order to alleviate the humanitarian crisis.