Cuba announces sweeping economic reforms as Díaz-Canel declares 'times when change is necessary'

Cuban President Miguel Díaz-Canel announced on Friday a wide-ranging programme of economic liberalisation and decentralization. The measures, labelled the Economic and Social Programme for 2026, aim to break centralised controls and attract investment as the island grapples with chronic shortages, energy blackouts and Washington’s tightened oil blockade.

Core liberalisation measures

Private businesses will see the list of prohibited activities drastically reduced so that their scope is as broad as possible. Pending applications for new ventures will be approved in the shortest time possible. The approval of micro, small and medium enterprises (mipymes) will be delegated to municipal governments to cut red tape.

For non-state forms of management, the list of prohibited activities will be limited so that their scope of operations is as broad as possible.

Tourism and real estate opened

New operators will be let into the tourism sector to exploit hotel infrastructure after the partial or total withdrawal of major foreign chains that fled to avoid US sanctions. The real estate business is also being reformed with 'new models' and 'new players', though the government offered few details.

State enterprise autonomy and agriculture

State-owned enterprises, which account for roughly 80 percent of economic activity, are to gain far greater autonomy: they will set their own wage systems without regulatory ceilings, reinvest profits, handle imports and exports directly, and participate in the foreign exchange market. State import intermediaries will be eliminated to make foreign trade 'more dynamic'. In agriculture, producers will be allowed direct access to inputs, partnerships with other economic actors, real bank accounts in hard currency, and participation in the currency market, while bureaucratic tramits will be made as light as possible.

Streamlining the state and shifting subsidies

The president announced a restructuring of the state apparatus that would reduce the number of ministries and cut the government payroll significantly, a plan requiring parliamentary approval in July. The government will also begin a gradual transition from blanket product subsidies to targeted support for vulnerable people.

The country is not paralysed; the country is facing this situation intelligently.

The political calculus

Díaz-Canel insisted the shift was dictated by 'the exigencies of current times' rather than by pressure from Washington, which has imposed an oil blockade since January and, according to one report, raised the spectre of military intervention. However, the reforms are widely seen as a direct response to a crisis that has sparked growing social unrest and the exodus of foreign investors.

Opposition scorn

Dissident voices quickly dismissed the package as window-dressing. In an essay published the same day, opposition figure José Daniel Ferrer argued that the regime was merely applying a patch to a 'rotten system' to buy time.

Cuba doesn’t need patches. Cuba needs a profound economic reform and a total political reform. It needs a real market economy, where productive forces are liberated, wealth is created, and food, goods and services are produced without the suffocating control of the Communist Party.

Ferrer demanded the return of land to private owners, full freedom to import and export, and an end to the state monopoly that he said had destroyed agriculture and industry alike.