The Impact of Freezing Foreign Currency Accounts in Cuba
How it affects investors and diplomats
HAVANA TIMES – The Cuban government has informed foreign companies operating in the country that “they will not be able to withdraw or transfer abroad the foreign currency already deposited in Cuban banks,” according to what several business and diplomatic sources on the island confirmed to the Spanish news agency EFE on November 20, 2025.
The measure, described by economists as a “corralito” (freeze) extends to the entire foreign sector a mechanism that the authorities tested in early April 2025 with a small group of companies.
“It’s terrible, because it’s one more strike against the Cuban government’s credibility regarding its commitments, not only with its commercial partners but also with investors and foreign delegations,” emphasized Cuban economist Mauricio de Miranda in a recent conversation with elTOQUE.
The professor at Javeriana University of Cali, Colombia added that this “is nothing new” but rather another version of what happens with US dollar accounts belonging to Cuban citizens on the island, who are “forced” to deposit their money in banks and then are not given access to it because the government has decided to use it.
“They shouldn’t use it, they cannot use it (…); the bank must give it back when you ask for it or otherwise declare bankruptcy because it has no liquidity (…). What cannot happen is for a bank not to give you your money and remain so relaxed,” he added.
“Real” Accounts vs. “Fictitious” Accounts: A Failed Attempt to Restore Trust
In parallel, the Cuban government offered foreign companies, according to EFE, the option to open a new type of bank account called “real” accounts, which must be funded with foreign currency coming from abroad.
Unlike the existing accounts, these would—in theory—allow transfers abroad and cash withdrawals. However, some companies also reported difficulties with these accounts, which has further increased uncertainty regarding the true liquidity of the banking system.
De Miranda recommended not opening “any real account, because nothing guarantees that six months from now they won’t be in the same situation.”
According to the EFE report, these decisions fall within the government’s Program to Correct Distortions and Relaunch the Economy, which foresees a new mechanism for managing and allocating foreign currency, though without offering details.
The government also imposed similar restrictions on the diplomatic corps. According to the report, Cuba’s Foreign Ministry informed embassies that although they will not be required to open “real” accounts, a date would be set after which they will regain access to their funds—a date the ministry called a “cutoff date.”
That is, any foreign currency deposited by embassies after this cutoff date (which has not been specified) may be withdrawn and transferred abroad, but funds deposited before that date carry no guarantee of availability.
The announcement comes at a time when numerous diplomatic missions, according to EFE, are moving their finances out of the island—to destinations such as Panama, the Dominican Republic, or Miami—due to increasing difficulties accessing their resources.
De Miranda said the recent announcement of the closure of Belgium’s Embassy in Havana was also noteworthy.
“Surely the reasons are far greater than this (the freezing of foreign currency accounts); however, it is striking that the country whose capital is the seat of the European Union (EU) decides to withdraw its mission from our country,” he remarked.
A Banking System Without Liquidity and with an Extreme Exchange Rate Gap
The Cuban banking system is undergoing a deep crisis due to lack of liquidity, something even official sources have acknowledged in recent days.
While foreign companies face growing obstacles to accessing their own funds, the official exchange rate for legal entities remains at 24 pesos per dollar—far from the real exchange rate in the informal market, which exceeds 430 pesos per dollar.
This distortion affects operations, profit repatriation, and financial planning for investors and embassies.
On his Facebook profile, De Miranda described the situation as clear evidence of the banking system’s inability to back deposits in foreign currency and harshly criticized the government for offering “real” accounts that could, in his words, also become “fictitious.”
De Miranda noted that deposited foreign currency not being available means those resources have been used by the government or by state conglomerates, which he described as “theft.” In his analysis, this crisis of confidence will contribute more to financial suffocation than external sanctions.
“The ‘geniuses’ of Cuban finance are strongly contributing to the economic sanctions they denounce, because they have managed to ensure that no one trusts the Cuban financial system,” he said.
Following the same line, Cuban economist Rafaela Cruz wrote in Diario de Cuba that “the foreign-currency freeze in Cuba is not just serious, it is extremely serious.”
“Not being able to repatriate profits or capital is one of the greatest fears of any foreign investor. If the regime had to resort to this measure—which is undoubtedly the last option for any government—it is because it is not only bankrupt but also in a state of panic,” she noted.
She added that the shortage of foreign currency and the inability to stabilize the economy make any monetary support policy unworkable.
The freezing of foreign currency belonging to foreign companies and diplomatic missions confirms that the Cuban banking system has exhausted its room to maneuver. Without adequate reserves, without access to external credit, and without internal credibility, the government chose to immobilize others’ funds to meet its commitments.
It is a decision that may give short-term oxygen but accelerates long-term suffocation: without financial security there will be little investment, and without investment there will be no recovery.
First published in Spanish by El Toque and translated and posted in English by Havana Times.