Cuba approves unprecedented opening of economy amid severe strain

Cuba's Communist Party has approved an emergency economic package that would open parts of the island's state-dominated system to more private activity. The plan was submitted to the National Assembly on Thursday and is expected to pass, according to the supporting material. It marks a significant shift for a country that has been governed by the Communist Party since 1965.

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The package would expand opportunities for private enterprise and seek to attract more foreign investment, including from Cubans living abroad. It could also pave the way for private real-estate development and the transformation of state-owned businesses into private commercial ventures with shares and equity stakes. The measures would also allow private banks to enter Cuba's finance sector, which has long been dominated by the state.

President Miguel Diaz-Canel told the party's Central Committee in a broadcast on Thursday that the country's economic crisis could not be blamed on external pressure alone. He referred to obstacles that do not come from outside or the blockade, and cited slowness, bureaucracy and delayed decisions as factors holding back production. He said the situation called for urgent and necessary changes.

The move comes as Cuba faces severe economic strain and heightened pressure from the United States. The supporting material says the US has maintained a trade embargo for decades and has increased pressure since January by blocking fuel deliveries to the island. The European Union also added to the pressure on Thursday by passing a resolution calling for sanctions on Diaz-Canel and the leadership of Grupo de Administracion Empresarial SA, a military-run business conglomerate.

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The reform package suggests the government is trying to respond to both domestic economic weakness and external constraints. It also points to a broader debate inside the Communist Party over how far Cuba should go in loosening state control. Diaz-Canel said some of the reforms would not have absolute consensus, indicating that hardliners may resist parts of the plan.

What remains unclear is how quickly the National Assembly will act and how much of the package will be implemented in practice. The supporting material does not specify a timetable for the reforms or detail which sectors would be opened first. It also remains to be seen whether the measures will ease shortages and investment constraints or face delays from political and bureaucratic resistance.

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