The gross domestic product (GDP) of Cuba grew by 1.3% in 2021, below the estimated 2%, with which the country’s economy is still below 2018 levels.
Meanwhile, in the first quarter of 2022 the island economy registered a growth of 10.9% compared to the same period of the previous year, an “unusual” rebound that is largely explained by the economic situation of the previous year, as reported this Thursday by Alexander Gilhead of the Ministry of Economy and Planning (MEP).
After the “big drop” in 2020 and being “practically paralyzed” in 2021, the first quarter of this year sends the “signal” that Cuba has “begun a gradual process of recovery from economic activity”, Gil pointed out before the plenary session of the National Assembly of People’s Power.
?@AlejandroGilF on the @AsambleaCuba explains that in the first quarter of 2022 the economy in #Cuba had a growth of 10.9%, compared to the same period in 2021 where the country was practically paralyzed.
✔️Ratified that the goal of reaching 4% by the end of 2022 pic.twitter.com/x3s6GV6uuV— Cubavision International (@CVInternational) July 21, 2022
The minister assured that, with this evolution, “the conditions exist to reach the goal for 2022”, which is to achieve economic growth “around 4%”. However, he stressed that despite the return to growth, the current GDP is 10% lower than in 2018.
The Cuban GDP in 2021 as a whole reached 51,334 million Cuban pesos (around 2,053 million dollars), the agency points out EFEquoting Gil.
The sectors that are pulling the Cuban economy this year are Public Health (14.3% in interannual terms in the first quarter), Education (9.4%), transport, storage and communication (5.9% ) and hotels and restaurants (5.3%).
Meanwhile, productive activities and trade continue to be a drag on growth. The manufacturing industry, for example, contracted 15% in year-on-year terms.
The Cuban deputy prime minister also assured that it is difficult to say which is the biggest problem of the national economy, because there are many current ones, but that the main one in his opinion is “associated with the lack of foreign currency.”
In the first semester, Cuba entered 2,521 million dollars, above the 1,660 of the same period of 2021, but still far from the 4,072 of 2019.
The main exportable items in the first half of the year were, in descending order: nickel and cobalt, raw sugar, honey, tobacco, rum, biopharmaceutical products and telecommunications.
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Along with the announcement about economic growth, it also emerged that in the first half of the year inflation in the regulated market it stood at 13.40%, after the rise in prices in 2021 reached 77.3%.
The Cuban head of the economy portfolio acknowledged before the parliamentarians that although some official prices (food, electricity,…) have not risen, most people have access to products at prices that are not regulated, through intermediaries who practice the “reselling and speculation”.
Independent analysts estimate that inflation in the island’s extensive informal market was between 500 and 700% last year.
For his part, Gil Fernández estimated that official inflation for 2022 as a whole could be around 28%. This would mean a cumulative above 100% in two years, points out EFE.
The minister also acknowledged that 2021 was the second consecutive year with a fiscal deficit above 10% of GDP, something he defended due to the social nature of public spending in a context of economic crisis.
However, he advocated moving towards budgetary stability and studying the efficiency and size of the socialist state company, considered the main economic actor by the country’s authorities.
Cuba is going through a serious economic crisis, visible in the long lines, the shortage of basic products such as food and medicine, the sharp increase in prices and the frequent power cuts. This situation has been impacted by the effects of the pandemic, the sanctions of the United States and the failures in the national economic policy.
EFE / OnCuba
