Is Cuba booming? Young entrepreneurs are given more space to breathe

The Caribbean island’s economy has been tightly planned by the state for decades. Yesterday, the historic economic reform presented many opportunities for the country’s small entrepreneurs.

Since Fidel Castro’s revolution in 1959, tiny Cuba has remained a Marxist state where the government plans and implements almost all aspects of society. It also meant that starting your own business on the island was not a natural occurrence. Even today.

In the face of a sluggish economy, it appears that the Cuban government will continue to attract its citizens with an entrepreneurial spirit. Previously, company formation was permitted for 127 economic activities. Today, this list has expanded to include more than 2000 activities. It is a historic victory for the progressive Cuban economists, who have long fought for more freedom for small business owners to support the economy.

600,000 entrepreneurs

The Cuban economy has been in recession for some time. It has been stagnant for years and shrunk by about 11 percent in 2020, partly due to the epidemic. Cuba depends to a large extent on the tourism sector.

President Miguel Diaz-Canel announced several reforms to address the crisis last year. Exports were increased in an effort to boost domestic production. Young entrepreneurs will now have more freedom of movement. There are about 600,000 of them in Cuba, and that number will increase. Currently, only 13 percent of the population is self-employed. About 40 percent of these work in the tourism sector or in public transportation.

The oldest trade ban

Another cause of the crisis is the ongoing embargo with the United States. By the way, it is the longest trade ban ever. There, too, things have been slowly moving in the right direction in recent years.

In 2015, the Obama administration lifted several travel restrictions between the United States and Cuba. Later that year, President Barack Obama and Raul Castro, brother of Fidel Castro and then President of Cuba, had a historic meeting. It was the first time in 50 years that the leaders of the two countries shake hands.

Trump re-listed Cuba as a “state sponsor of terrorism” in the last week of his presidency.