Dear FO° Reader,

Greetings from Geneva, as usual, but today, we fly straight to the Caribbean, to the beautiful island of Cuba. The island likely remains as beautiful as ever, but my informants — a waitress and an IT developer who left the island a couple of decades ago — report that their families are suffering. 

Via Shutterstock.

Former Cuban President Fidel Castro died in 2016, shortly after grand festivities for his birthday in August 2016, and only a couple of months after I visited. Raúl Castro succeeded Fidel, and things went downhill from there. However, we saw rays of hope: hordes of tourists, many from Quebec, so many that some resorts served “la poutine” on the beach!  

Nine years after Fidel’s death, Raúl Castro handpicked his own successor — Miguel Díaz-Canel — who has limited autonomy and is bound by ideological loyalty. 

Under Diaz-Canel’s presidency, poverty is rampant, division and inequality are growing and people suffer. Díaz-Canel was chosen by Castro to ensure continuity of the Communist Party’s ideology. He became president in 2018 and First Secretary of the Communist Party in 2021, marking him the first non-Castro leader since the revolution. While he still holds top titles, Díaz-Canel initially governed under Castro’s shadow. Castro retained significant influence as head of the military and party until 2021, suggesting Díaz-Canel’s early authority was constrained. 

According to both The Conversation and Reuters, Cuba faces its worst economic crisis since independence, with GDP contraction, hyperinflation and severe shortages. Díaz-Canel’s government implemented austerity measures, including a 500% fuel price hike and electricity tariff increases, exacerbating public anger. And Diaz-Canel attributes economic collapse to the US embargo, citing it as the primary cause of shortages and blackouts. However, critics argue that internal inefficiencies — such as state-controlled enterprises and failed reforms — are major contributors. 

Sources: 

Why Cuba’s Díaz-Canel Is Still in Trouble – Americas Quarterly 
Cuban economy continues five-year decline, economy minister says | Reuters

History betrayed? 

The Cuban Revolution of 1959 was founded on a social pact that promised greater equality and social inclusion through state-guaranteed access to education, healthcare, employment and basic necessities. By the mid-1980s, only about 6% of Cubans lived in poverty — a stark contrast to many Latin American countries where poverty rates often exceeded 40%. This was achieved through policies like universal education, healthcare, full employment and a rationing system (libreta de abastecimiento) that ensured minimal access to food for all. However, this system involved constrained individual economic freedom in exchange for state-provided security. 

Source: Cuban government scrambling to deal with outrage about country’s economic crisis, The Conversation 

Public anger is not primarily driven by political dissent but by “spontaneous expressions of residents’ frustration and despair over their inability to meet basic needs.” The announcement of the 500% increase in the price of subsidized gasoline was a key catalyst for recent protests. This desperation is widespread and organic. 

Faced with this outrage, the government is portrayed as “scrambling.” Its strategy is multi-pronged, involving a tactical retreat, with the first move being to postpone the massive fuel price hike to “avoid aggravating the population’s frustration.” Then the deflection of blame to the US economic embargo (and the country’s inclusion on the US list of state sponsors of terrorism) as the primary cause of the crisis. Followed by heavy censorship and control of the population and the media. As the regime is actively blocking internet access and social media platforms to prevent the organization and spread of protest information and control the narrative.

While the government points to the US embargo (which certainly compounds the problems), the Conversation’s article argues that the primary cause is internal:

Blame US sanctions

The government’s insistence that US sanctions are to blame for limiting the possibilities for economic recovery is increasingly regarded with skepticism. However, the constraint on economic growth imposed by US measures is real and severe. It is also the deliberate aim of US policy. The unilateral sanctions not only block trade, but also financial and international travel between the US and Cuba. They also severely hamper all kinds of transactions between Cuba and the rest of the world. – The Conversation,  by Emily Morris, 25 July 2025 

Is it that bad to blame the US sanctions? The whole point of sanctions is to be effective in making it hard for a government to keep doing what it wants to do. So, it is the sanctions, but also many other structural factors such as flaws in resource management and corruption, as there are some rich Cubans. But how did they get rich in a controlled regime? 

At least two authors have a critical approach to the embargo: 

Maurizio Giuliano explores how the embargo has a counterproductive effect by generating “empathy” that bolsters the Cuban regime’s legitimacy, as Cuba is cast as resisting external pressure — thus inhibiting external forces pressing for democratization.

Wayne Sanford Smith, an American diplomat who opposed the embargo, criticized it as being “counterproductive” — believing it hindered meaningful engagement and rapprochement rather than promoting reform.

Sources: 

Analyzing the US Embargo on Cuba: A Search for a Better Solution Annamaria.edu

Wayne Smith (US diplomat) – Wikipedia

Looking back — nine years after Fidel Castro’s death and in a Cuba struggling under a deepening economic crisis — the US embargo serves not merely as a geopolitical tool but also as an ideological barrier. It underscores an anxiety within Western capitalist democracies about the mere existence of a functioning alternative. 

In effect, sanctions function as a defense of what is possible. They’re reinforcing the notion that capitalism isn’t the only way, and reminding Cuba — and the world — that another path has been carved, however imperfectly followed. Perhaps, then, the most subversive thing Cuba still does today is simply remind us that, however constrained, another way of organizing society remains imaginable.

Further sources: 

A Look at Cuba: Growing Inequalities | ReVista 

US sanctions Cuban president, ’regime-controlled’ luxury hotels | Donald Trump News | Al Jazeera 

The Caribbean is breathtaking, and Cuba is no exception — warm people, good food and prices that feel cheap to a European or American traveler. But what is “cheap” for us often reflects deep local hardship. When I visited in 2016, I saw how those working in tourism could earn in a single day what others made in a month, while elderly women begged travelers for something as simple as soap. The question is not whether we should stop traveling — we won’t — but how to do it responsibly: by staying with locals, supporting small businesses and being aware of the inequalities our presence can widen.

Sources for sustainable tourism:

Sustainable Travel: Tips on Sustainable Tourism from the Frontline | 
What is Sustainable Tourism? Here’s the Definition | GSTC