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Economy in Cuba: EIU Projects 7.2% Contraction in 2026

The Economist Intelligence Unit warns that the Cuban economy will suffer a dramatic 7.2% drop this year, accumulating a 23% collapse since 2019.

Aroma de Cuba · · 3 min read
An empty Cuban market stall with an old clock in the background showing 2026, symbolizing the economic crisis.

The Cuban economy is facing a devastating 2026. According to the latest report from The Economist Intelligence Unit (EIU), the island’s Gross Domestic Product (GDP) is expected to contract by 7.2%. If this forecast holds, Cuba will have lost nearly a quarter of its economic output (23%) compared to the end of 2019.

An Accumulated Collapse

This figure is not an isolated event but rather the culmination of years of structural inefficiency, the tightening of external sanctions, and a decaying energy system that hinders any productive effort. Cuban economist Mauricio de Miranda highlighted that this contraction places the country in a state of extreme vulnerability, where the capacity for recovery is increasingly limited.

The crisis manifests daily in food shortages, uncontrolled inflation, and power outages that paralyze both the state sector and the emerging private sector. The lack of foreign currency prevents the import of basic supplies and fuel, creating a vicious cycle of shortages and stagnation.

Key Factors of the Contraction

  1. Energy Deficit: Blackouts lasting more than 20 hours in much of the country have halted industry and commerce.
  2. Unchecked Inflation: The informal market continues to dictate prices, making the average salary insufficient for basic needs.
  3. Lack of Foreign Investment: Political and economic instability deters investors needed to capitalize on key sectors.
  4. International Relations: Rising tensions with its main regional partner complicate any relief through remittances or credit.

The EIU’s projection ranks Cuba as one of the worst-performing economies in the region, highlighting the urgency of deep structural reforms that, so far, the government seems reluctant to implement effectively.

Frequently Asked Questions (FAQ)

What does a 7.2% contraction mean for the average Cuban? It means fewer products available in stores, an increase in the prices of the few remaining services, and greater difficulty in accessing medicine and basic food.

Why is 2019 used as a point of comparison? 2019 was the last year before the pandemic and the significant tightening of current external policies. It represents the pre-pandemic level that Cuba has not been able to recover.

What role does the energy crisis play in this forecast? It is fundamental. Without electricity, industries cannot produce and the services sector (including tourism) suffers constant interruptions, reducing the country’s income.

Is there any chance this projection might change? The EIU’s forecasts are based on current trends. Only radical changes in domestic economic policy or an unexpected shift in international relations could mitigate this decline.

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