Although the US embargo hurts the Cuban economy, the economists say, the main causes of the crisis are internal
Juan Palop/EFE (via 14ymedio), Havana, 11 October 2025 — The US sanctions against Cuba hurt its economy and curb its potential, but they are not the fundamental cause of the serious crisis that the Island is suffering from, eight of the country’s most recognized independent economists diagnosed in statements to EFE. Their views on this issue, with their differences, contrast with the positions of the Cuban government, which claims that US sanctions are the “main cause” of the economic debacle.
The issue returns to the agenda a few days after the vote at the UN general assembly on the resolution submitted annually by Havana against the US sanctions, which according to its estimates — not specified in detail — cost it about 20 million dollars (EUR 17 billion) in daily losses over the past few months. The calculation is terribly complex because it starts from a maze of six decades of political, economic, legal and financial decisions in Washington that have a diverse impact, and the indirect costs are very difficult to pinpoint.
As New York City University professor Tamarys Bahamonde explains, in addition to clear and quantifiable prohibitions, Cuba is outside international organizations such as the World Bank and on the US list of countries that sponsor terrorism, so Cuba has “limited access to credit” and a “significant financial cost,” respectively.
Still, all the experts surveyed by EFE agree that Havana could do a lot to revitalize its economy and is not doing so. The economists consulted provide a range of perspectives. Despite not being unaware of the effect of the sanctions, they mainly point to Havana for the deep national crisis of the last five years, with economic contraction, high inflation, shortage of basic inputs (food, medicines and fuel), progressive dollarization, mass migration and prolonged daily blackouts.
The Cuban crisis is, in their view, “the heir of structural problems resulting from an ineffective economic system” and a failed model
Mauricio de Miranda, a professor at the Pontifical Javeriana University of Cali (Colombia), says that the sanctions “affect the country, and especially the Cubans on the street,” although he says to be wary of the “cheerful” cost figures — without detailing or auditing — that Havana exposes. The Cuban crisis is, in his opinion, “the heir of structural problems resulting from an ineffective economic system” and a failed model that “is intended to be maintained by the Cuban leadership.”
The economist Pedro Monreal, for his part, claims that the impact of sanctions “exists and is great,” but that there are other factors which constitute a major burden such as the “inefficiency” of the planned economy system and the structure of state investments.
Alejandro Miguel Hayes, coordinator of the Institute for Research on the Caribbean Basin, says that “the Cuban government is 100% responsible for the crisis” because it does not use the resources it has at its disposal to solve it or improve living conditions on the Island.
For his part, Ricardo Torres, a researcher at the American University of Washington, calls the sanctions “a very important external restriction” but adds that he does not believe they are “the most important factor to explain the crisis.”
Pavel Vidal, also professor at the Pontifical Javeriana University of Cali, divides responsibilities equally between “the external blockade and the internal blockade” and highlights that the Cuban economy has “a high dependence on sanctions policy” mainly through remittances and tourism (rather than commercial).
According to Omar Everleny, a professor at the University of Havana, “there is no doubt that the US blockade* against Cuba significantly damages the country’s economy and Cubans,” but he adds that “much can be done internally.”
The majority of professionals, consulted on an individual basis, point to the Island’s own political and economic system as the primary cause of the serious Cuban crisis. Hayes speaks of “the logic that prevents making optimal or better decisions for wealth generation,” and Monreal argues that centralized planning is “the pillar of a model that does not work” and “prevents the productive forces from being released.”
The majority of professionals, consulted on an individual basis, highlight the political and economic system of the Island as the main cause of the serious Cuban crisis
Bahamonde highlights “the decision-making model of a bureaucratic socialist system” and hence the “partial,” “fractional” and “slow” implementation of reforms, with “cycles of crisis, reform and counter-reform” which do not bear fruit. He also points to over-regulation and “legislative uncertainty” which discourages investment.
Torres recognizes the weight of a set of external shocks -from the pandemic to the tightening of sanctions in the two mandates of Donald Trump-, but he gives pre-eminence to the model of “a centrally planned economy.” De Miranda also stresses the need to look in politics for the causes of the Cuban economic prostration and highlights among the main reasons the “political and institutional system” of “authoritarian and autocratic character,” the abandonment of the “social conquests of the revolution” and “systematic errors” in economic policy.
In the same vein, the Cuban-American Carlos Martínez explains the Cuban economic situation by the policies of centralized planning, general nationalizations and systematic restrictions on private initiative.
Translated by Regina Anavy
*Translator’s note: There is, in fact, no US ‘blockade’ on Cuba, but this continues to be the term the Cuban government prefers to apply to the ongoing US embargo. During the Cuban Missile Crisis the US ordered a Naval blockade (which it called a ‘quarantine’) on Cuba between 22 October and 20 November of 1962. The blockade was lifted when Russia agreed to remove its nuclear missiles from the Island. The embargo had been imposed earlier in February of the same year, and although modified from time to time, it is still in force.
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