Foreign hotel chains and businesses flee Cuba as US sanctions on military conglomerate Gaesa take effect

The Gaesa ultimatum

An executive order signed by President Donald Trump on 1 May 2026 set a 5 June deadline for foreign companies to sever ties with Grupo de Administración Empresarial S.A. (Gaesa), the opaque military-run holding company created by Raúl Castro in 1990. The order threatens to freeze US-based assets of any foreign person or company doing business with the conglomerate. Gaesa, controlled by the Revolutionary Armed Forces, is estimated by external sources cited by Reuters to handle between 40% and 70% of the foreign currency flowing through Cuba. Its portfolio spans five-star hotels via the Gaviota tourism subsidiary, the Mariel port, the Fincimex commercial bank, supermarkets, petrol stations and remittance companies.

Gaesa is not an opaque structure, nor parallel to the Cuban state; on the contrary, it has been a carefully crafted and proven effective response to the economic blockade that has historically tried to suffocate the Cuban Revolution.

Hotel chains retreat

Spain's Meliá, the first foreign chain to enter Cuba in 1990 and the largest operator with 34 hotels, announced on 3 June the immediate termination of operations at 15 properties linked to Gaviota. Iberostar, also Spanish, relinquished 12 of its 16 establishments. Canada's Blue Diamond abandoned all its operations "with immediate effect," and Indonesia's Archipelago International, Southeast Asia's largest private hotel group, withdrew its Aston brand from several hotels, including some of Havana's most modern and luxurious properties. Spanish chains had managed roughly 30,000 rooms and more than 70 hotel administration contracts, primarily in four- and five-star establishments, according to Spain's Economic and Commercial Office in Havana.

Companies that have maintained relations with Cuba need a profitable market; right now that does not exist.

Beyond tourism

Visa and Mastercard payment operations were suspended in Cuba as of 6 June, after the unidentified foreign private bank processing those transactions halted services. French shipping line CMA CGM and Germany's Hapag-Lloyd stopped container deliveries. In mining, which accounts for a third of Cuba's merchandise exports, Canada's Sherritt International announced a non-binding agreement for Gillon Capital, a firm linked to a former Trump adviser, to acquire a 55% stake in its joint venture with the Cuban government. Sources close to the Cuban government told El País the sanctions have a single objective: "They want to take over the Gallegos' business," referring to Spanish immigrants who settled in Cuba in the late 19th century.

Energy crisis compounds the collapse

Cuba's energy grid is in critical condition. On Saturday 7 June, state utility Unión Eléctrica projected a generation capacity of 1,090 MW against peak demand of 3,050 MW, leaving a deficit of 1,960 MW and estimated blackouts affecting 65% of the country simultaneously during the evening peak. Seven of 16 generation units are offline, including the Antonio Guiteras plant, the country's largest, which suffered its fifth breakdown in just over a month and its thirteenth in 2026. The plant runs on domestic crude and is not affected by the US oil blockade, but 40% of the energy mix depends on distributed generation using diesel and fuel oil, which has been paralysed by the US oil squeeze that Havana calls "genocidal." Cubans, especially in the capital, average a maximum of four hours of electricity per day; in the rest of the island, blackouts can last up to two consecutive days.

A sector in freefall

Tourism is Cuba's second-largest economic activity after medical service exports, contributing nearly $3 billion annually to GDP in pre-pandemic years. The sector grew rapidly from the late 1990s and became a vital source of hard currency for a country that imports 80% of what it consumes. Under the Cuban model, hotels are at least 51% state-owned, with foreign chains providing branding, reservation systems, international promotion, tour operator agreements and management standards in exchange for a share of profits. The exodus of foreign operators leaves those properties without the commercial infrastructure that once drew millions of visitors from Europe, Canada and beyond. Hotel operating costs have surged while tourist demand has collapsed, leaving establishments virtually empty as energy costs soared.

Tourism generates employment and also leaves other spillovers for families such as tips, a very important source of income for workers in the sector.

American firms eye the vacuum

The departure of foreign companies opens the door for US firms. Marriott, the world's largest hotel chain with 7,781 properties, and Airbnb, the largest short-term rental platform with nine million listings, have both previously operated in Cuba under special licences granted during Barack Obama's second term. El País reports that these are among the first candidates to fill the void left by European and Canadian operators.