Havana mover. Photo: Juan Suarez
Havana mover. Photo: Juan Suarez

HAVANA TIMES — The Cuban government cut its prediction for economic growth in 2014 to only 1.4% down from 2.2 %, reported dpa news on Monday.

The figures reflect a “higher than expected slowdown,” Economy Minister Adel Yzquierdo told a meeting of the Council of Ministers (cabinet) on Saturday, noted the official Granma newspaper.

The forecast for the first half of the year is expected to be an even lower growth of 0.6 percent of gross domestic product (GDP), according to new estimates.

To reach the new projected annual growth of 1.4 percent for 2014 “greater dynamism of the economy will be needed in the second half of the year,” said Yzquierdo.

In recent years the Cuban government attempts to revive its economy with a slight opening of the market. In late March, the government of Raul Castro approved a new foreign investment law that seeks to attract capital inflows with tax incentives, among other measures. The law is supposed to take effect on June 28.

Havana hopes its economic liberalization in the coming years will allow for economic growth to reach between five and seven percent, according to plans presented during the discussions of the new investment law back in January.


10 thoughts on “Cuba Cuts Growth Forecast to 1.4%

  • True, the conditions on Vietnam were different. However, the conditions which triggered the embargo were also different. The US imposed the embargo on Cuba in retaliation to Castro seizing all US owned property in Cuba, which was a significant amount of money. There was very little US owned property in Vietnam.

  • At the time, less than 20 years after successfully forcing the Americans to leave, these conditions did not seem any less palatable to the Vietnamese government than the conditions set forth under Helms Burton seem to the Castros. Dani, what is so hard about allowing an independent media, releasing political prisoners, and holding a free and open election? The Castros are ‘leaving’ in less than 5 years anyway. They have ruled for more than 55 years! I am arguing that the conditions for the Castros are no more imposing than what the Vietnamese.

  • However the conditions were very different. Vietnam was only asked to help with the Missing in Action and to be a bit more tolerant with religious believers. Nothing like the demands made on Cuba.

  • It does beg the question. Early on after the pullout of US forces in Vietnam, both countries were under sanctions by the US. The US, under Clinton, set conditions for lifting those sanctions and after these conditions were met, improved bilateral relations ensued. Coincident with improved relations with the US were improved economic conditions in Vietnam, including Vietnam becoming a world leader in rice exports. Just imagine what conditions in Cuba would look like today had the Castros not remained recalcitrant in their refusal to work to lift sanctions?

  • Cuba sent advisors to Vietnam during the war, to help build and run their North Vietnamese POW camps. Several US POW’s reported seeing Cuban prison workers. Following the US withdrawal from Vietnam and the eventual victory of the NVA over the abandoned South Vietnamese, the communist regime sent hundreds of thousands of people to work in forced labour camps growing rice. Is that the sort of technical expertise Castro sent to their Socialist brothers?

  • The Castro “government” has a way to “present” statistics that stray quite far from reality! Sarcasm is one of my favorite tools of expression!

    U.S.-CUBA TRADE AND ECONOMIC COUNCIL, INC.
    ECONOMIC EYE ON CUBA- February 2012 – Report For Calendar Year 2011
    2011-2001 U.S. EXPORT STATISTICS FOR CUBA

    The government of the Republic of Cuba reports data that, according to the government of the Republic of Cuba, includes transportation charges, bank charges, and other costs. However, the government of the Republic of Cuba has not provided verifiable data. The use of trade data reported by the government of the Republic of Cuba is suspect. The government of the Republic of Cuba has been asked to provide verifiable data, but has not.

    CLICK LINK FOR ENTIRE REPORT!

    http://www.cubatrade.org/CubaExportStats.pdf

  • Official Cuban “off-the-record” projections put the annual growth rate at less than 1%. The source of the lower increase is largely due to the sale of Cuban petroleum received from Venezuela at lower subsidized prices and resold in the international market at higher market rates. Cuba will purchase more than $2 billion in food, approximately 80% of total consumption, to meet the population’s needs. At the end of the Vietnam war with the US, Cuba sent experts to Vietnam to assist in restarting rice production in the then war-torn Vietnam. Today, Cuba buys the majority of the rice they consume from Vietnam. Cuba once led the world in sugar exports and today has contracted with a Brazilian conglomerate to manage their largest sugar mill facility. It would appear that “socialismo” has done more harm than good to Cuba’s economic well-being.

  • Invest in Cuba and go to jail, go directly to jail, do not pass GO and do not collect $200.
    Canadian and British businessmen having invested in Cuba ended up in jail. Real free enterprise does not exist in Cuba. The Cuban economy following fifty five years of Castro Socialismo is in a mess. President Raul Castro Ruz obviously recognises that capitalism is necessary but appears not to comprehend that his believe that it is possible simultaneously for the State to limit employees earnings to less than a dollar a day and to retain control and power over all forms of business is wishful thinking.
    There is world wide competition for investment and if the Castro regime wishes to persuade capitalists to invest, it has to provide conditions which are attractive to them. Yes, it may manage to persuade the Chinese government to invest – and end up paying the price, which would only add to the debt already incurred.

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