MÉRIDA, Mexico.- The economist Cuban Emilio Morales, vice president of the Cuba XXI Century Ideas laboratory, has denied, in conversation with CubaNetthe economic growth forecasts made by the regime for 2025.
With a system electroenergetic collapsed, higher inflation and fuel shortages, and the constant decline in tourism, the outlook is not rosy.
In the current context, what lifeline could the regime resort to to get out of this serious and deep crisis in which we find ourselves?
I don’t see any changes on the horizon that will reverse that dynamicI think they are hitting rock bottom and there are none, neither Chinese, nor Russian, nor Mexico.
Perhaps the biggest help that Cuba is receiving right now is from Mexico, it is not even from China or Russia, Mexico has given it more than a billion dollars in the last two years. oil to Cuba, without costing them a cent, I do not believe that the Mexican economy is in a position to maintain that rate of oil supply to Cuba in exchange for nothing, it is also paying a fortune for doctors that they do not need and paying for vaccines that no one gets. says, then that’s not going to last long either.
On the other hand, neither China nor Russia have taken a step to invest in Cuba, nor to give credit, they are temporary, last-minute aid, to avoid collapse, what everyone is waiting for.
I believe that 2025 is going to be a year perhaps harder than 21, which was when the protests arose, the famous protests of the July 11now with the other difficulty, that it is not the Biden administration that is 90 miles away, it is the Trump administration, which has another discourse, has another vision of the problem and has other solutions in its hand, which are not the ones practiced by the Biden administration.
I believe that we are experiencing the most vulnerable moment of the Cuban regime in its entire history, from every political, economic, financial and moral point of view, which is one of the most important, morally. All that old militancy that 10 years ago was an offshoot, a support for the Cuban regime, has collapsed.
Is 1% GDP growth by 2025 possible, as the regime predicted?
In 2025 they propose to grow by 1%, I don’t know where they got the number from because that is impossible. All the statistics and numbers they show, their own statistics, announce the opposite. The great “locomotive” is derailed, which was tourism.
Although they have invested in tourism the last 15 years 24 billion dollars, today, the average expenditure of a tourist in Cuba does not exceed 500 dollars. In the Dominican Republic, a tourist’s stay costs $1,500, minimum, or $2,000. It’s an abysmal difference. They almost did not meet the tourism goal again. Next year, the number of tourists will probably be lower.
No tourist He is used to paying money to go see hell. That segment of the tourism market does not exist in the world, hell. And these rulers have turned Cuba into hell. When you arrive, there is no electricity, no water, there are blackouts, garbage in every corner of the city, mountains of garbage, which is embarrassing, epidemic, hospitals falling apart. So, a tourist who has spent the entire year saving money to spend a happy vacation in any destination is not going to choose Cuba as a destination, they would rather go somewhere else.
dozens of tour operators They have stopped offering the Cuban market. Others have left, others who are still in Cuba have reduced the staff that works there to a minimum.
The sugar industry no longer produces sugar. Now Cuba is an importer of sugar. The few industries in Mariel are working at a minimum to avoid closing and losing the investment of hundreds of millions of dollars they have made in recent years.
Many said that the MSMEs They were going to be the lifesaver. Now, the most recent measure indicates that they have 90 days to change the corporate purpose because they cannot carry out wholesale trade if not through the State. In reality, their move to open up MSMEs in the way they did was a compromise to dismember GAESA into 70, 80 importing companies with front men. It turns out that the front men have not been loyal. Several of them are in prison. Many related to high government positions.
In reality, what has been uncovered is the truth. They never believed in MSMEs nor were they willing that Cubans could generate wealth freely.
In short, with an agriculture that produces nothing, with an economy that exports absolutely nothing, except nickel, which has dropped in price a lot, and lead and cobalt, which have dropped in price as well, I don’t see how they are going to grow 1 %.
Even the export of medical services has decreased. If you compare the peak they had in 2013, which was more than 10 billion dollars, it is down 56% compared to last year. They have a little left and that is the last influx of hard money they have.
What response would you give to this Minister of Economy and Planning, Joaquín Alonso Vázquez?
There is no human way to prove that what they are going to be viable posing. We have to see now when they put the floating exchange rate, how people react, what the change is going to be like.
Let’s now see what the pulse of the rate that they set is, which is the rate that people would follow, officially, normally, on a day-to-day basis, with the rate that they are going to set. We’ll see who people bet on more. I still think that the informal market will continue to dominate the exchange rate and will continue to dominate the foreign exchange of the country, because people do not trust the banks.
Under that premise, it will be very difficult for them to restore consumer confidence. People will prefer to continue having the dollars under their protection before putting them in the state coffers.
Regarding the recovery of thermoelectric plants, which is one of the issues that has affected the most, is there going to be an improvement?
There can’t be any improvement in the sense that Cuba needs, at least, 10 billion dollars to replace that entire energy matrix that is collapsed due to obsolescence, due to use, it has been in use for more than 35 years, due to lack of maintenance.
Cuba does not even have money to buy oil, nor for the maintenance that these old plants still need, which is very expensive.
So, there is also no patron who will come to provide the money so that these investments can occur, because there is also no way to recover that investment in the Cuban market.
Electricity in Cuba is a service subsidized by the State throughout life, and if you tell a Cuban now that electricity is going to cost you 100 or 200 dollars a month, as it costs anywhere in the world, right there you will everything ends.
So, I don’t see how a foreign investor is going to put in 10 billion dollars, or 5 thousand. In what time will that investor recover the money if there is no market mechanism that makes it easier for him to recover the investment? In an economy where its 10 million inhabitants do not pay for electricity in that currency in which oil must be purchased, nor is there a productive system that allows exports and to be able to pay that amount that is required. So, I don’t see a way.
Why so much fear of this new administration? donald trumpand what could it represent for the Cuban regime?
Apart from the crisis that the country is experiencing and what vulnerable who are at the moment, it should also be mentioned that, for example, the recent fall of the Syrian dictator has made them very nervous.
They have seen how Russia withdrew its troops from Syria, a country where they were committed to war to defend the Syrian regime.
That image that they have wanted to give of Russia, that it is a tiger that will defend them, is actually a paper tiger in practice. The Russians are not going to come here to defend anyone. Cuba is not going to be the object of any invasion, far from it. In any case, Cuba is going to sink itself. They themselves are the ones who are sinking the system itself.
And that’s going to come faster than people imagine. The situation is now that it can’t go any further. The exhaust valve has been closed.
There is no more parole. And this administration comes with that whip of closing the immigration issue, not only for Cuba, but for all parts of the world.
Trump’s doctrine comes along the lines of closing the way to these dictatorships and has a very tough team.
They have no choice but to open up, as the Chinese, the Vietnamese, have told them. I believe that we are experiencing the final stage of Castroism. It is a painful stage. I don’t think it’s going to be very peaceful. I think it’s going to be tragic. But in the end it is necessary. And I believe that we are going to live in very tense moments in 2025.
Things, many things, can happen internally. They can accelerate as the days go by, as Raúl Castro can physically disappear from the face of the earth. Once that event occurs, I believe that it will accelerate the process of the fall.
I can assure you that this year 2025 will be worse than the 24th. There is no indication that it will improve. All the parameters to which they have referred are pure fantasy and in practice we are seeing it. The Cuban is living it day by day. The Cuban does not believe anything they say.
