THE CUBAN REGIME’S ECONOMIC PACKAGE TRIGGERS INFLATION, FOOD SHORTAGES AND POPULAR DISCONTENT
Basic products are missing in Havana markets
The recent implementation of a set of Kscal adjustment measures by the Cuban dictatorship, popularly known as the ‘economic package’, has resulted in an acceleration of in5ation and a worsening of the already serious economic crisis suffered by the country. Since the Krst day of March, when these measures came into force, the value of the dollar and the euro against the Cuban peso reached record Kgures (314 and 320 pesos (CUP), respectively), exacerbating Knancial tensions in the Caribbean nation. In the parallel market, the only access to foreign currency for Cubans, they rose 4 and 5 pesos.
The reforms, which include an increase of more than 500% in the price of fuel, the increase in rates for basic services and the elimination of the subsidy for the basic food basket, attempt to stabilize the Cuban economy, but have unleashed popular discontent and long lines at gasoline sales points.
These drastic economic measures come at a time of deep crisis for Cuba, a country that is facing the worst economic recession in more than six decades, characterized by a severe devaluation of its currency and an alarming poverty rate that closed the year 2023 at 88% of the affected population.
The Cuban regime argued the implementation of this “great package” as an attempt to contain hyperin5ation and revitalize its economy. However, the immediate impact has been an increase in prices and an increase in the dissatisfaction of citizens, who – in addition to the well-known restrictions on democratic freedom – face severely reduced purchasing power.
At the heart of this economic crisis are the extremely low incomes received by the inhabitants of Cuba. Currently, the minimum wage on the island is less than USD 7.5, while the average monthly salary barely reaches USD 15. These Kgures are even more aggravated when the amount of the minimum pension is observed, which does not exceed USD 5 per month. These incomes are insu.cient compared to the cost of living and the high prices resulting from rampant in5ation.
The implementation of these adjustments coincides with a situation of shortage of basic resources, re5ected in scheduled blackouts and a request for aid to the UN World Food Program (WFP) by the Cuban dictatorship, with the aim of ensuring the provision of milk for children under seven years of age.
Blackouts, in fact, have been one of the triggers for anti-government protests in recent years, including those on July 11, 2021, the largest in decades.
Additionally, the temporary suspension of fuel sales by the state company Cimex and announced electricity cuts by the Electrical Union (UNE) of Cuba, due to the maintenance of its largest thermoelectric plant, further aggravate the already di.cult situation of the nation.
The Castro regime also announced that bread, a staple of the Cuban diet, will be in short supply during March. The regime’s Ministry of Food Industry stated that this is due to “specikc situations” with “planned shipments” from allied countries, such as Russia, but did not provide further details.
For most Cubans, news like this is a cyclical problem in a country that imports 80% of the food it consumes, according to the United Nations. Especially at a critical point of economic crisis and with a lack of foreign currency to pay suppliers.
In addition to bread and the lack of milk, producers such as rice, coffee, and oil have been experiencing shortages and delays on a regular basis in recent months.
In the midst of this bleak panorama, Cuban dictator Miguel Díaz-canel continues to make international tours, which has sparked criticism from analysts and members of the community, who see these actions as disconnected from the reality faced by the majority of Cubans in day-today life.