Madrid/“The dynamics of the Cuban economy in 2025 were consistent with the use of an exhausted economic model without effective springs that allow pulling levers to transform a reality in need of structural changes and a renewed capacity for adaptation.” This is how forceful the most recent report of the Center for Studies of the Cuban Economy (Ceec), corresponding to the second half of 2025, which includes devastating data.
For example, the island’s gross domestic product (GDP) contracted around 5% last year, accumulating a drop of more than 15% since 2020. According to the Ceec report, which is an official institution, the economy worsened for the third consecutive year, largely due to the energy crisis that has weighed down the country since mid-2024.
The Cuban Government has not released official figures so far, but the president, Miguel Díaz-Canel, recently assured that GDP had fallen by 4% in the first three quarters of last year. “The economy deepened its contraction during the year, so that a pattern of stagnation and lack of recovery was consolidated,” indicates the document, which highlights the drop in external income, the decline in tourism and the deterioration of energy conditions in an adverse international context and with increased pressure from the United States.
The text insists on the “absence of substantial structural and macroeconomic reforms” on the Island
The text insists on the “absence of substantial structural and macroeconomic reforms” on the Island and, although it recognizes that the Executive managed to reduce the fiscal deficit “to levels considered manageable” – up to 74,518 million pesos, around 6% of GDP –, this improvement did not translate into growth or better conditions of equity or development.
Investment remained low (around 10% of GDP) and the energy crisis, in any case, acted as a “drag axis on the rest of the sectors”: the island’s electricity generation fell by 13.7% in year-on-year terms.
In this context, the report qualifies as “critical” the state of the national electrical system (SEN) due to the “aging of thermoelectric plants”, many built in the 60s and 70s of the last century with Soviet technology.
Regarding inflation, the official figure indicates 14.07% for the year as a whole, but recognizes that there are “higher unofficial estimates” that place the increase in the price of the basic basket at 70% year-on-year. This is the figure that independent economists use, in fact. as Pavel Vidalwhich raises data from the National Office of Statistics and Information (Onei), according to which inflation tripled between 2021 and 2024.
Regarding small businesses, the Ceec observes “a slowdown in the creation of MSMEs”
The Ceec report speaks of an “accumulated erosion of purchasing power” in recent years because salary increases in the state sector do not compensate for the bite of inflation. This implies, the document concedes, a “deterioration of social conditions” that is reflected in multiple indicators, from infant mortality – which has risen almost five points to 9.8 per thousand since 2020 – to mass emigration. Although the report includes the official Onei figure of 9.6 million inhabitants, independent studies calculate that there are only just over 8 million.
Regarding small businesses, the Ceec observes “a slowdown in the creation of MSMEs.” Between September 2024 and December 2025, 816 new MSMEs were approved – out of a total of more than 11,000 – but 869 of those that exist reported losses and 65 closed totally or partially. “Regulatory tensions persisted and there was no evidence of a structural transformation of the state company, whose results showed falls in sales and profits,” the report states.
Food, energy, transportation and tourism showed general declines, the document compiles, with concrete numbers: year-on-year decrease in exports of goods and services of 8.2%, drop in passenger transport around 10% and cargo transport by almost two million tons and a debacle in international travelers, 10.5% less in 2025, with hotel occupancy of just 18.9% until September and some 1.6 million visitors between January and November, close to 40% of pre-pandemic levels.
Thus, the Ceec, which closed its study before pressure from the United States so that oil does not reach the Island, predicts for 2026 a “scenario dominated by uncertainty.” Furthermore, he describes as “optimistic” the 1% growth forecast for this year advanced by the Cuban Government. And the document concludes: “Cuba is going through what could be described as a ‘critical juncture’ defined as a situation of intersection and overlap of several crises.”
