This Tuesday, ECLAC launched its ‘Preliminary Balance of the Economies of Latin America and the Caribbean, 2025’.
MIAMI, United States. – The Economic Commission for Latin America and the Caribbean (ECLAC) estimated that Cuba’s economy will contract by 1.5% in 2025, after the 1.1% reduction registered in 2024, and projected a growth of only 0.1% for 2026, a performance that leaves the Island among the few economies in the region with negative figures this year, according to the Preliminary Balance of the Economies of Latin America and the Caribbean, 2025presented this Tuesday in Santiago de Chile.
In its country report on Cuba, ECLAC noted that “the country’s economy continues to be affected by internal imbalances and external shocks” and that, during the first half of 2025, “no signs of recovery were observed,” with deteriorations in “strategic sectors such as tourism and energy,” in addition to “shortage of inputs and foreign currency.” The organization attributed the lack of momentum to “the adverse international context, sanctions and structural problems, such as delays in carrying out reforms and limited foreign investment.”
The 2026 projection, although positive, points to an extremely slow exit from stagnation. According to ECLAC, the 0.1% advance is supported by the expectation that “some contractionary factors could be attenuated,” although “without yet translating into a significant recovery.” Within this horizon, the report highlighted the persistence of “structural distortions” and key restrictions: “lack of imported inputs and financing”, inflation that “erodes family income” and an “exchange market” that “remains distorted”, with a Cuban peso “very devalued” in the informal market.
In terms of prices, ECLAC reported a year-on-year inflation slowdown: last November, inflation stood at 14.95%, compared to 27.0% in the same month of 2024. The document attributed this fall to “the decrease in fiscal imbalances and price control.”
Regarding public accounts, the regional commission forecast that the fiscal deficit will continue to reduce in 2025 “to be around 6.6%.” In parallel, it estimated a real reduction of 1.9% in public revenues during 2025, after the strong growth of 32.1% in 2024, a year that – according to the text – was marked by higher tax revenues and also by unforeseen extraordinary inflows.
For total spending in 2025, ECLAC projected a real reduction of 2.0%, explained by a contraction in current spending of 5.5% associated, among other factors, with the cutting of subsidies for business losses and the control of administrative expenses, while “some social subsidies are preserved, such as those related to electricity and medicines.”
The report also described financial pressures associated with the fiscal closure. The organization calculated that the total financing demand for 2025 would amount to 129,374 million pesos, composed mainly of fiscal deficit and amortization of sovereign bonds, and pointed to the issuance of Sovereign Bonds of the Republic of Cuba as the main source to cover these needs, which – according to the document – “represents an increase in the monetary base.”
In the external sector, ECLAC anticipated that the current account will continue to be in the red, due to “low merchandise exports”, the “decrease in international tourism” and “the lower dynamism of remittances.” In this context, it reported that between January and July 2025, total exports of goods and services were estimated at 5,993 million dollars (with 76.6% corresponding to services), while total imports were estimated at 5,442 million dollars, with interannual increases of 8% and 4.5%, respectively.
On the exchange front, ECLAC recalled that the Cuban Government has maintained a dual (fixed) regime since August 2022: 24 Cuban pesos per dollar for the state sector and 120 Cuban pesos per dollar for the non-state sector and households, and reported that the informal market registered an average price of 375 pesos per dollar between January and November of this year.
The regional report, released this December 16, placed Cuba and Haiti as the only economies in Latin America and the Caribbean with contraction in 2025, in a regional environment that ECLAC described as a “low growth dynamic.”
