Caribbean & Central America - October 2026

The Cuban government appears to remain committed to its sweeping market-friendly economic reforms, a total of 176 measures first announced in June. These cover increased private sector participation in the economy, together with incentives for foreign investment and the easing of banking, foreign currency and trade rules. On 2 September the authorities published 34 pages worth of new rules and changes to law in Cuba’s official gazette.

Foreign Trade Minister Oscar Pérez-Oliva said his government is “increasing flexibility, simplifying processes, reducing timeframes and red tape, and above all responding to the demands … of investors to facilitate their business operations in Cuba and make their companies more efficient.” The latest measures notably allow foreign companies, including those in the tourism industry, to hire staff directly, instead of having to go through state employment agencies that tend to favour members of the Partido Comunista de Cuba (PCC). Additionally, foreign companies setting up joint ventures will henceforth be required only to inform the authorities, rather than seek permission to operate.

While many welcome the reforms, there are concerns that they are simply too little and too late. US sanctions and domestic mismanagement are still a powerful disincentive to foreign investors. The economy continues in free-fall, with the University of Havana’s centre for the study of the Cuban economy (CEEC) calculating that GDP fell by 5% in 2025, the third year of contraction. There are now reportedly long daily queues outside banks since there is a shortage of CUP10,000 and CUP20,000 currency notes (worth respectively US$14 and US$28 on the black market). In late September, the black-market dollar reached a record CUP700 according to international newswire Reuters.

• Fiscal deficit

In its latest report presented on 25 September, the University of Havana’s centre for the study of the Cuban economy (CEEC) highlighted some stark indicators. These include the fact that Cuba’s accumulated fiscal deficit in the first half of 2026 reached CUP35.02bn (US$1.46bn on the official rate), compared with CUP7.7bn in the same period in 2025 – a deterioration which CEEC attributes to a shortall of revenues of over CUP26.3bn associated with the contraction in economic activity. CEEC said that the Cuban finance ministry is projecting that 2026 will close with a deficit of CUP132.91bn, nearly double that registered in 2025, and equivalent to approximately 11% of GDP.