The Republic of Cuba, currently undergoing a slow and painful modernization process, just lost its “Líder Máximo”. Fidel Castro, aged 90, reportedly passed away on Friday, November 25th. Speculation about the leader’s health and even of his rumoured death had been around for a long time.
Castro belonged to a generation of historical figures who left an everlasting mark on the 20th century and on the world we live in. He led the Cuban Revolution along with Ernesto “Che” Guevara. The two – heroes in the minds of many – resembled the ideals of Communism and social justice, even after the failure of the then-Cuban-ally USSR.
The island of Cuba had seen political instability and rebellions long before the barbudos started their campaign to overthrow the Batista dictatorship. In 1959, Castro’s rebellious forces took Havana, where he formed a new government, which also faced strong opposition from day one, including the one coming from the US, which saw in the new regime a formidable threat. After several episodes, including the Bay of Pigs invasion and the Cuba Missiles Crisis, the US imposed a total ban on trade between the two countries, which has contributed to the struggles of the Cuban economy, one of the last programmed ones in the world.
The Cuban political scenario cooled down after the 60’s, mainly because of the financial support from the Soviet Union, which had a vested interest in the survival of a communist country on the American doorstep. After the fall of the USSR, the country suffered a tragic economic crisis, which led to many Cubans fleeing to the United States, despite strong political limitations on leaving the island. Cuba has since found political support in other Latin American countries and in the likeminded People’s Republic of China, which is also one of its main trade partners.
The slow easing of the Communist party’s control over its peoples’ lives, which has characterised Raúl Castro’s time in charge – after his brother’s resignation in 2008 – might bring hope also for the Cuban economy; and with it for the whole Central America region.
Political strategies are deeply entangled with the economic situation: investment is weak, despite a tentative by the Cuban government to ease laws on foreign businesses’ presence on the island, dating back to 2014. Starwood, the hotels brand, was the first American firm to enter Cuba since the 50’s and was able to do so right after Obama’s historical visit, in March of this year. American companies – understandably fended off by their own country’s limitations to trade – are not the only ones that are taking their time before jumping on board: political control and strong rules on how to conduct business are keeping investors from all over the world on the defensive.
Some foreign investors were able to get into Cuba already in the 90’s, when the flow of money coming from the Soviet Union stopped and ways had to be found to attract capital. These include joint ventures, in which foreigners partner with the local government in financing business operations. Needless to say, many are weary of the idea of joining forces with an authoritarian government, basing their activities on a legal framework which has little regard for business interests.
Limitations to businesses in Cuba are not only of the legal kind: corruption is an important issue when having to deal with the public sector on a daily basis, also financing is hard to get by on the island and consumer goods are a no-go because of property issues, despite the huge demand.
In short, the reinstatement of US-Cuban relationships is just the first in a series of steps that will have to be taken if Cuba is to become part of the free market (admitting for a second that that is its intention). The Obama administration was certainly moving in the direction of fully lifting the embargo, but that alone wouldn’t be sufficient, for reasons already mentioned. As for many others, Donald Trump’s recent election shuffled the cards on this table. It is not clear in which direction talks between the two countries will head in the future, but the president-elect has already made it clear that he had no sympathy for the newly deceased revolutionary.
The many Cubans, some of which living in exile, who believe their country would be better off by opening up to the world and to economic exchange with other countries, will have to wait for a change of mind in their government; their hopes now lie with Fidel’s living brother Raúl, which in his years of rule has shown a more openminded approach to foreign relations and might now finally be able to put the revolution where it belongs: in the past.
Federico Gagliardelli
Castro belonged to a generation of historical figures who left an everlasting mark on the 20th century and on the world we live in. He led the Cuban Revolution along with Ernesto “Che” Guevara. The two – heroes in the minds of many – resembled the ideals of Communism and social justice, even after the failure of the then-Cuban-ally USSR.
The island of Cuba had seen political instability and rebellions long before the barbudos started their campaign to overthrow the Batista dictatorship. In 1959, Castro’s rebellious forces took Havana, where he formed a new government, which also faced strong opposition from day one, including the one coming from the US, which saw in the new regime a formidable threat. After several episodes, including the Bay of Pigs invasion and the Cuba Missiles Crisis, the US imposed a total ban on trade between the two countries, which has contributed to the struggles of the Cuban economy, one of the last programmed ones in the world.
The Cuban political scenario cooled down after the 60’s, mainly because of the financial support from the Soviet Union, which had a vested interest in the survival of a communist country on the American doorstep. After the fall of the USSR, the country suffered a tragic economic crisis, which led to many Cubans fleeing to the United States, despite strong political limitations on leaving the island. Cuba has since found political support in other Latin American countries and in the likeminded People’s Republic of China, which is also one of its main trade partners.
The slow easing of the Communist party’s control over its peoples’ lives, which has characterised Raúl Castro’s time in charge – after his brother’s resignation in 2008 – might bring hope also for the Cuban economy; and with it for the whole Central America region.
Political strategies are deeply entangled with the economic situation: investment is weak, despite a tentative by the Cuban government to ease laws on foreign businesses’ presence on the island, dating back to 2014. Starwood, the hotels brand, was the first American firm to enter Cuba since the 50’s and was able to do so right after Obama’s historical visit, in March of this year. American companies – understandably fended off by their own country’s limitations to trade – are not the only ones that are taking their time before jumping on board: political control and strong rules on how to conduct business are keeping investors from all over the world on the defensive.
Some foreign investors were able to get into Cuba already in the 90’s, when the flow of money coming from the Soviet Union stopped and ways had to be found to attract capital. These include joint ventures, in which foreigners partner with the local government in financing business operations. Needless to say, many are weary of the idea of joining forces with an authoritarian government, basing their activities on a legal framework which has little regard for business interests.
Limitations to businesses in Cuba are not only of the legal kind: corruption is an important issue when having to deal with the public sector on a daily basis, also financing is hard to get by on the island and consumer goods are a no-go because of property issues, despite the huge demand.
In short, the reinstatement of US-Cuban relationships is just the first in a series of steps that will have to be taken if Cuba is to become part of the free market (admitting for a second that that is its intention). The Obama administration was certainly moving in the direction of fully lifting the embargo, but that alone wouldn’t be sufficient, for reasons already mentioned. As for many others, Donald Trump’s recent election shuffled the cards on this table. It is not clear in which direction talks between the two countries will head in the future, but the president-elect has already made it clear that he had no sympathy for the newly deceased revolutionary.
The many Cubans, some of which living in exile, who believe their country would be better off by opening up to the world and to economic exchange with other countries, will have to wait for a change of mind in their government; their hopes now lie with Fidel’s living brother Raúl, which in his years of rule has shown a more openminded approach to foreign relations and might now finally be able to put the revolution where it belongs: in the past.
Federico Gagliardelli