The Business News Source for the Community of Sarnia - Lambton

Cuba at a Crossroads as “Guerrilleros” Surrender Power

Phil Egan's picture
Tue, 05/01/2018 - 12:37 -- Phil Egan

For the first time in almost 60 years, Cuba is being led by a man whose name is not Castro.

The road ahead is shrouded in fog.

Ten years after Fidel Castro’s brother, Raul, took the reins of power from an ailing Fidel, the 86-year-old, the last of Cuba’s revolutionary leaders, has stepped down.

He leaves the country of 11.5 million people, a popular winter haven for Canadians for decades, with a troubled economy, a stalled entrepreneurial growth, and dashed hopes to the quick end of America’s cruel Kennedy-era economic embargo.

This columnist spent 40 years in the Canadian travel industry, operating packaged holidays throughout the Caribbean, Mexico and South America. In Cuba, our flights operated to Veradero, Holguin, Guardalavaca, and Santiago de Cuba. In the 1980s, my company, Regent Holidays, helped the Cuban government agency, Cubanacan, to build and operate Cuba’s first all-inclusive resort.

Over the past 50 years, I and other Canadian travellers have seen many changes in what American President John Kennedy once famously referred to as, “that imprisoned island.”

My first visit to Cuba came less that 10 years after the 1962 Cuban Missile Crisis that brought the world to the brink of nuclear annihilation. Soviet MIG fighter aircraft lined the runways at Havana’s Jose Marti airport – until recently, one of the fastest-growing airports in the world.

It was a growth primarily cooled by the frosty return of hostility emanating from Donald Trump’s White House.

In the early 1970s, Canadian Prime Minister Pierre Trudeau made it clear that Canada would pursue our own, friendlier relationship with the country. Trudeau fostered a personal friendship with Fidel, – to the dismay of the United States. In 2000, Fidel Castro even served as an honorary pallbearer at Trudeau’s funeral in Montreal.

A pattern of Canadian tourism to the island followed ever since; at one point in the last decade representing one-third of Cuba’s entire foreign tourism traffic.

With the fall of the Soviet Union on Boxing Day, 1991, Cuba’s already-fragile economy suffered a blow, as massive subsidies to the communist island petered out. The subsidies, totalling over $6 billion annually, were later taken up by Venezuela, now mired in its own economic morass.  

The last ten years under Raul Castro were a time of considerable change for Cuba. In a move opposed by communist party hardliners, Raul legalized some small and medium-sized businesses in an attempt to jump-start a sluggish economy.

Today, there are 600,000 private entrepreneurs and more than 5 million cellphones in the country. The real estate market is flourishing. According to Jen Savedra’s industry newsletter, Travel Industry Today. Cubans, who once needed permission to leave the country, now travel freely. Tourism, now accounting for 5 million visitors annually, has surged since Barack Obama established diplomatic relations with Cuba in 2015. Substantial foreign debt has been repaid, and internet use on the island, once a rarity except for favoured senior party and politburo members, is soaring.

But as 57-year-old Miguel Diaz-Canel, formerly Cuba’s vice-president, assumes the presidency, serious difficulties remain. As Travel Industry Today summarizes, “Cuba’s Soviet-style command economy still employs three of every four workers – but produces little. Private sector growth has been largely frozen. The average monthly state salary is US $31 – so low that workers often live on stolen goods and handouts from relatives overseas.  The island’s infrastructure is falling deeper into disrepair.” Cuba is also suffering a serious “brain drain,” as tens of thousands of its best-educated professionals flee the country every year. A byzantine dual currency scheme, with one peso worth four cents and another almost a dollar, also badly needs reform.

Worse, Cuban hopes of finally seeing America’s 1960 commercial and economic embargo lifted have seemingly been dashed by the mercurial and unpredictable isolationist now occupying the White House.

Despite America’s shifting attitudes, Canada’s relationship with the New Cuba remains strong.  Two million Canadians travel to Cuba annually, and the countries also have cooperative ventures in mining. Trade between the two nations totals more than one billion dollars annually.

As Cuba stands at a crossroads leaving its revolutionary leaders behind, the road ahead will be interesting to watch.


Fine Print