International
Cuba, crisis and dollarization: without foreign exchange there is no country
The shortage of bread and rice, liquefied gas and gasoline, basic medicines and public transport, even daily blackouts. Many symptoms of the Cuban polycrisis have their origin in a common problem: the lack of foreign exchange of a state that monopolizes vast sectors of the economy.
The Liquefied Gas Company reported on Monday that it had no balitas (cylinders) until “the next import”, just one day after a freighter with 24,000 tons of wheat docked in Havana, where the manufacture of bread had been paralyzed due to lack of flour.
For weeks the queues at the service centros (gas stations) have been perpetual and many electric generation engines remain at a stop due to a shortage of imported fuel, while large areas of the country suffer blackouts of 20 or more hours a day.
“There is a critical shortage of foreign currency in the country,” Cuban economist and doctor in Public Policies Tamarys Bahamonde told EFE.
Independent experts consulted by EFE agree to start with the collapse of national agricultural and industrial production, which has skyrocketed imports, which account for 80% of what the country consumes, according to the United Nations.
In turn, the main sources of foreign exchange income – tourism, remittances, professional missions (mainly medical), sugar, the biopharmaceutical sector and nickel – have fallen significantly.
This has generated a strong imbalance in the accounts of the State, which exercises the monopoly of foreign trade and other key sectors.
“If there is no production that you can stop importing, we will not get out of this vicious circle,” says Cuban economist Omar Everleny, professor at the University of Havana.
The financial situation is such that in the middle of last year the Government began to decide on budget execution on a regular basis, depending on the actual income of each month.
The Cuban Government underlines the weight of US sanctions and the financial effects of their inclusion in the list of countries sponsoring terrorism for this crisis. The experts, for their part, highlight the internal causes (without denying the damage of the blockade or embargo).
Cuban economist Ricardo Torres, a professor at the American University of Washington (USA), talks about structural imbalances of decades and denounces a bad allocation: “More than a problem of resources, it is a problem of use of money.”
He explains that the Government has financed in the last ten years a “massive construction of hotels” – a sector in the hands of Gaesa, the army’s business consortium – despite very low occupancy rates.
“Seeing the public numbers, I come to the conclusion that it is a country in crisis, without a doubt. But with that I can’t justify that there is not even for wheat,” he says.
The consensus among the experts consulted is that 2025 will be the same or worse than 2024, in which the economy contracted. After five years of serious crisis, Cuban domestic product (GDP) is below 2019 levels.
They do not believe that the measures announced by the Government at the end of 2024, including a deepening of the dollarization of the national economy from the State, will reverse the situation.
Not without controversy, the Government has begun to charge in currency for customs procedures and higher octane gasoline, among others, in addition to converting part of its retail stores into establishments that sell in dollars.
Bahamonde sees in these decisions a copy of those that were taken in the crisis of the 1990s, and that were then reversed.
“It’s a way to raise money. Is it a long-term measure? No, will it guarantee economic development? No, what about growth? Neither. It is purely revenue, rential,” says the economist, who speaks of “subsistence economy.”
Everleny believes that many coordinated and in-depth reforms against the crisis in Cuba would be needed, something he does not perceive after the two severe adjustment packages approved in the last 15 months.
Bahamonde advocates making foreign trade more flexible, establishing a real foreign exchange market, extending participation to the private sector in domestic trade, renouncing the model of centralized administration, and eliminating Gaesa’s control over the Cuban economy, in general, and tourism, in particular.
“All solutions are medium and long-term, but people on the street need solutions today. If drastic, quick measures are not taken,… the time horizon of the resolution is moving away,” he warns.
In Everleny’s opinion, “the state needs long-term aid, like the International Monetary Fund,” because the country has already reached the point of “break”.
However, he himself does not see this option as viable because Cuba does not belong to these international organizations and because he believes that the United States would not approve financing lines for Havana.
International
Colombian president Gustavo Petro warns against U.S. military intervention in Venezuela
Colombian President Gustavo Petro defended his Venezuelan counterpart Nicolás Maduro after the U.S. administration labeled him as the leader of the “Cartel of the Suns” and authorized the Pentagon to use military force against drug cartels, which could lead to an intervention on Venezuelan soil to combat these criminal groups. Petro stated that any military operation without the approval of Colombia or Venezuela would represent an “aggression.”
Petro responded over the weekend following reports on Friday from U.S. media about President Donald Trump’s order to confront designated global terrorist organizations such as the Cartel of the Suns, the Sinaloa Cartel, and the Tren de Aragua, including operations on foreign soil. Furthermore, the U.S. State Department increased the reward for information leading to Maduro’s capture from $25 million to $50 million.
“I publicly convey my order given as commander of the Colombian armed forces. Colombia and Venezuela are one people, one flag, one history. Any military operation without the approval of the brother countries is an aggression against Latin America and the Caribbean. It is fundamentally contradictory to our principle of freedom. ‘Freedom or death,’ Bolívar shouted, and the people revolted,” Petro posted on his social media, clearly expressing his disagreement with potential U.S. military intervention in Venezuela.
U.S. Secretary of State Marco Rubio said in an interview on The World Over program on Friday that controlling these terrorist groups is decisive. He added that, for the U.S., these gangs are no longer just local street gangs but well-organized criminal enterprises spreading from Mexico, Guatemala, and Ecuador.
“We cannot continue treating these guys as local street gangs. They have weapons like terrorists, in some cases they have armies. They control territories in many cases. These cartels extend from Maduro’s regime in Venezuela, which is not a legitimate government,” Rubio told the audience.
International
U.S. offers $5 million reward for arrest of haitian gang leader Jimmy “Barbeque” Cherizier
The United States announced on Tuesday a $5 million reward for the arrest of Haitian gang leader Jimmy “Barbeque” Cherizier, accused of violating U.S. sanctions. Haiti, the poorest country in Latin America and the Caribbean, is engulfed in a political crisis and a wave of armed gang violence, which an international security mission led by Kenya is trying to end.
Cherizier, 48, and Bazile Richardson have been formally charged with attempting to transfer funds from the United States to Haiti to finance gang activities, the Department of Justice reported.
“There is a good reason to offer a $5 million reward for information leading to Cherizier’s arrest,” said federal prosecutor Jeanine Pirro at a press conference.
“He is a gang leader responsible for atrocious human rights violations, including violence against U.S. citizens in Haiti,” she added.
Cherizier has been subject to U.S. Treasury sanctions since 2020 and UN sanctions since 2022.
International
Mexican President Claudia Sheinbaum to meet Guatemalan leader Bernardo Arévalo next friday
Mexican President Claudia Sheinbaum confirmed on Monday that she will hold her first bilateral meeting with her Guatemalan counterpart, Bernardo Arévalo, next Friday.
During her press conference at the National Palace, Sheinbaum detailed that the August 15 meeting will include a brief visit to Guatemala, followed by a trilateral meeting with Belize’s Prime Minister, Juan Antonio Briceño, in Calakmul, Campeche, in southeastern Mexico.
Sheinbaum explained that the meeting was proposed by Arévalo during a phone call last Friday, in which the Guatemalan president invited her to visit Guatemala.
The agenda will begin on Thursday night when Sheinbaum travels to Chetumal to lead her morning press conference on Friday.
Afterwards, she will travel to Guatemala for the bilateral meeting with Arévalo, then return to Calakmul to meet Belize’s Prime Minister Briceño for a trilateral meeting with Arévalo.
Later, Sheinbaum will hold a bilateral meeting with the Belizean leader.
The president announced that many agreements will be announced during the meetings with the southern border countries but avoided providing details to keep them as a surprise for that day.
Colombian president Gustavo Petro warns against U.S. military intervention in Venezuela
U.S. offers $5 million reward for arrest of haitian gang leader Jimmy “Barbeque” Cherizier
Honduras condemns U.S. reward against Nicolás Maduro as baseless attacks
Tec de Monterrey honors one of its students for his contribution to nanotechnology in medicine
Defense Minister commends salvadoran soldier for Central American Cross Country victory
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