Can Cuba’s Largest Reform Package in Decades Reverse the Crisis?

On June 17, Cuba’s Communist Party held an extraordinary plenary session at which Prime Minister Manuel Marrero Cruz presented 176 strategic transformations to Cuba’s economic and social model before the National Assembly of People's Power (ANPP), acknowledging that significant change is needed to confront the challenges facing the island. The following day, the party approved the package. President Díaz-Canel has also called on experts to submit additional reform proposals based on the announced package.

The measures touch nearly every corner of the Cuban economy. Broadly, they aim to reduce state control in various sectors, expand property rights, attract foreign investment—including from the Cuban diaspora—streamline state institutions, and create new business opportunities. Proposals range from facilitating foreign investment and trade to authorizing non-banking financial institutions and opening the door to new commercial ventures.

Major questions remain. No implementation timeline has yet been established, raising concerns that many of the reforms could be slow-walked. The sequencing of these measures will be critical to determining their effectiveness. Moreover, many official notices, regulations, and legislation must be issued before the reforms take effect. As President Díaz-Canel himself acknowledged, some proposals are not new; they were approved in previous reform efforts but never implemented, leading many experts to question the government’s credibility. Who will regulate these changes? Who will implement them? And where will oversight come from?

While the reforms are undoubtedly linked to the growing economic pressure facing Cuba, including pressure stemming from Trump administration policies, they do not appear to be the product of a tacit negotiation between Havana and Washington. Although the US has long advocated for economic and political reforms in Cuba, U.S. officials have dismissed the latest package as little more than “superficial smoke signals.”

Shortly after the reforms were announced, the US expanded its sanctions by designating additional Cuban entities, including a key bank, Banco Financiero Internacional S.A. (BFI). This further complicates the business environment for foreign investors. These actions suggest that Washington is not prepared to ease pressure in response to Havana's announced reforms alone, but instead expects broader concessions that meet their demands before considering real changes to U.S. policy.

Cuba's Deputy Foreign Minister Josefina Vidal Ferreiro said there is ongoing direct dialogue between the two nations, but Havana has drawn a red line at any political changes that they claim threaten their “independence, sovereignty, self-determination.”

Scholar Tamarys L. Bahamonde penned an analysis for CEDA on the proposed reforms and their implications for Cuba’s future. She argues that the reforms come amid a “systemic crisis” marked by “increased precarity and poverty, worsening energy and food scarcity, and infrastructure collapse.” While the reform package spans 23 policy areas and may differ from previous efforts “in both scope and ambition,” Dr. Bahamonde notes that many of its proposals are not entirely new. Instead, they emerge from a longstanding pattern in Cuban policymaking in which authorities introduce reforms when conditions become “so dire as to trigger a political crisis,” only to later reverse or slow those changes once the economy stabilizes. This history explains the skepticism of experts, investors, and citizens, as there is “no indication or guarantee that this time will be different.”

She argues that the reforms’ success will be constrained by significant domestic and external challenges. The country faces “a scarcity of human capital needed to push for a transformative reform,” while “collapsed infrastructure and distrust in institutions and the government have increased the risk of investing in Cuba.” 

She further argues that the reforms cannot succeed without major changes in U.S. policy. According to Bahamonde, meaningful implementation would require significant amendments to Titles I and II of the Helms-Burton Act, which codify the U.S. embargo, as well as the removal of secondary sanctions on foreign entities doing business in Cuba. Current restrictions limit access to U.S. markets, making several of the proposed reforms difficult to implement under existing law. She also points to Title III, which allows U.S. nationals to sue companies that profit from property confiscated after the Cuban Revolution. That provision, she argues, substantially increases legal risks for foreign investors and discourages investment in sectors Cuba urgently needs to modernize. 

She also notes that the package contains “no announced political reforms to accompany the process” and places insufficient emphasis on social protections. Rather than offering a transformative social agenda, many measures are “closer to policy goals than policy alternatives,” leaving unanswered questions about support for “Cubans in extreme poverty, children suffering from food scarcity,” and other vulnerable populations.

The analysis concludes that Cuba's reform effort “lacks a holistic and integrated approach” and that its success will depend heavily on factors beyond the government's control, including changes to U.S. policy and the willingness of foreign investors and the Cuban diaspora to commit capital to the island. Bahamonde warns that effective reform must be systemic, addressing economic, political, and social challenges simultaneously. Otherwise, Cuba risks repeating what she describes as the country's “vicious policymaking cycle,” the “eternal loop of crises, reforms, and counter-reforms.”

In addition to the challenges assessed by Dr. Bahamonde, the sale of state-owned entities to foreign investors could allow outside actors, such as the US, to gain significant control over key sectors of the economy.

Cuba is becoming increasingly connected to the U.S. economy. U.S. exports to Cuba have surged in 2026, due in large part to the Trump administration's decision to allow companies to export directly to Cuba’s private sector. This trend is likely to continue in the coming months. Meanwhile, many U.S.-based Cuban Americans continue to travel to the island to visit family and friends, providing an important source of support for Cuba’s struggling tourism industry. In May 2026, Cuban arrivals from the US comprised 62.2 percent of total visitors.

This growing economic interest extends to President Trump himself. In a recent interview on the Axios Show, when asked how Cuba might compare to the administration’s approach toward Venezuela, President Trump replied: “Well the difference is Venezuela has oil. Cuba doesn't. Cuba has a nice property and they have nice shoreline.”

Interest from foreign investors has also emerged. Reportedly, business figures from Egypt, Qatar, and other countries have expressed interest in sectors including tourism, mining, oil and gas, healthcare, and infrastructure. One investor has even signed a letter of intent to purchase land to build a luxury resort, tentatively called “Trump Island,” contingent on successful negotiations with the Trump Organization. Interest extends beyond individual investors; Guyana’s president has publicly encouraged his country’s private sector to explore investment opportunities in Cuba.

The urgency behind the reform package is reflected in worsening conditions across the island. Cuba recently decided to end the school year two weeks early due to persistent electricity shortages and transportation disruptions. Many schools had already reduced instructional hours, while ongoing migration has left the education system struggling to fill an estimated shortage of 26,000 teachers.

Without meaningful changes in either domestic policy or the broader U.S.-Cuba relationship, the humanitarian situation is likely to continue deteriorating, raising concerns about the potential for renewed large-scale migration. Vice President J.D. Vance recently acknowledged this risk during a press conference.

The strain is particularly evident in the healthcare system. According to Cuban state media, the survival rate for children with cancer has fallen from 85 percent to 65 percent since emergency energy restrictions were introduced in January. More than 100,000 Cubans are currently awaiting surgical procedures, while treatment schedules for nearly 3,000 dialysis patients have been disrupted. Medicine shortages remain severe: approximately 300 of the 395 essential medicines produced domestically are currently unavailable due to a lack of the chemical inputs needed for their manufacture.

U.S.-CUBA NEWS

US Imposes Sanctions on More Cuban Entities Affiliated with GAESA

On June 23, the US further expanded sanctions against Cuban officials and state entities, focusing on those affiliated with the Grupo de Administración Empresarial S.A. (GAESA), Cuba’s military conglomerate that controls a large portion of its economy. These designations are enforced through President Donald Trump’s May 1 executive order. With these designations, the US has added five Cuban entities and one individual, including Almacenes Universales S.A. (AUSA), Rafin S.A. (RAFIN), Banco Financiero Internacional S.A. (BFI), Geominera S.A., Empresa Siderurgica José Martí (Antillana de Acero), and Annalie Lilliam Rueda Cardero, the wife of Alejandro Castro Espín, who is the former head of the Cuban intelligence services and the son of former president Raúl Castro. These designations put the total number of sanctioned entities at 26 after 2 previous rounds of designations. The designations mean that these groups and officials cannot engage in the U.S. economy, and any prior transactions with U.S. companies are frozen immediately. If any foreign entities engage with designated groups or individuals, they risk secondary sanctions themselves.

Cuba’s Foreign Minister Bruno Rodríguez responded on X that these new designations are a “siege around the Cuban economy”, as they take the form of a “ruthless aggression” and “collective punishment” against the Cuban people. In comparison, Secretary Marco Rubio said on X that they are a means of reducing GAESA’s exploitative power over the island.

U.S. Exports to Cuba Rise Sharply in 2026

U.S. exports to Cuba have surged in 2026, reaching levels far above those seen in recent years. According to Bloomberg, the quantity of U.S. exports arriving on the island through May of 2026 nearly tripled the total recorded during all of 2025. Since February, more than 350 ISO tanks of diesel and gasoline have been shipped to Cuba, alongside approximately 3,300 cargo shipments carrying motor vehicles, preserved food, auto parts, and other consumer goods.

The increase has been driven in large part by the Trump administration's decision to permit fuel sales to Cuba's private sector. This policy has enabled a growing flow of fuel shipments to Cuba's emerging private sector, including at least 275 shipments of diesel and 82 shipments of gasoline transported in ISO tanks this year. In March alone, the US approved $8.7 million in fuel exports to Cuba's private sector.

U.S. trade with the island has increased steadily since 2021 despite the broader deterioration in bilateral relations and the tightening of sanctions under the second Trump administration. Between 2021 and 2025, U.S. exports to Cuba increased by 148 percent even as Cuba's total imports declined by 37 percent. Much of this growth has been concentrated in trade permitted under the Commerce Department's “Support for the Cuban People” license exception, which allows U.S. companies to export certain goods intended for private businesses and humanitarian purposes.

Despite the sharp increase in fuel exports, the volumes arriving from the US remain insufficient to address Cuba's severe energy crisis. The more than 350 ISO tanks delivered this year represent only a fraction of the fuel Cuba requires to sustain electricity generation, transportation, and industrial activity, and they are prohibited from being distributed to the government. Cuba has historically depended on tens of thousands of barrels of oil per day from foreign suppliers.

EnviosCuba No Longer Accepting Orders

On June 15, EnviosCuba suspended its services in Cuba, cutting off yet another lifeline for Cubans to receive food and medication. Prior to suspension, people and companies abroad could purchase goods for delivery to their family members and friends in Cuba, and the e-commerce platform would fulfill them using supplies available at Cuban state-owned warehouses. All previously placed deliveries will be fulfilled, but the e-commerce company will not accept new orders starting June 15. It is uncertain whether the hold is temporary or permanent.

The decision comes following further U.S. sanctions on entities associated with GAESA, which owns the majority of the warehouses and utility companies that EnviosCuba used to store its deliveries. EnviosCuba also did business with the GAESA-affiliated state retail corporation CIMEX, using them to store its goods. Many purchases were also processed by Spanish corporations, such as Nactws SL, Lorengrave SL, and Venta Online de Repuestos SL. These corporations are known to have ties to the GAESA-associated Graverán family, who manage a network of Spanish and Canadian e-commerce companies that process goods and deliveries to Cuba.

The suspension also impacts a variety of other stores that operated under EnviosCuba, including La Puntilla, Plaza Carlos III, Puerto Envío, ElectroEnvío, and Almacén-On: branches that also functioned under CIMEX and Tiendas Caribe. EnviosCuba stated that their suspension is due to “reasons beyond their control,” alluding to both U.S. sanctions and the worsening economic crisis as possible causes.

Supreme Court Rules Exxon Can Pursue Lawsuit Regarding Seized Properties

On June 23, the U.S. Supreme Court ruled that Exxon Mobil can pursue a $1 billion lawsuit against Cuba’s government regarding the Exxon properties seized by Fidel Castro in 1960. Exxon is pursuing the lawsuit through Title III of the Helms-Burton Act, which establishes the right for U.S. nationals to sue Cuba’s government over seized property. The Act was originally passed following Cuba’s government’s 1996 shootdown of two Brothers to the Rescue planes, for which former president Raúl Castro was recently indicted.

The court ruled that Cuba’s state-owned companies cannot leverage their national sovereignty when disputing ownership of assets seized by Cuba’s government. The ruling rejected the reasoning of Cuba’s government, which argued that it was protected by the Foreign Sovereign Immunities Act (FSIA), which exempts foreign companies from U.S. judicial rulings.

The ruling follows a similar case last month, where the Supreme Court concluded that the U.S. firm Havana Docks Corporation, which originally built and maintained the port in Havana prior to the Cuban revolution, may hold cruise lines liable for using the port. This included Royal Caribbean, Carnival, Norwegian, and MSC. With both Exxon and Havana Docks Corporation being U.S.-owned companies, the U.S. is fully discouraging any business and investment, as companies know they could face legal action.

Caritas Cuba Delivers Shipment to Cuba’s Eastern Province

During the week of June 11, Caritas Cuba, the Catholic Church’s official charitable organization, delivered a shipment of humanitarian aid from the U.S. government to the port of Santiago de Cuba, to provide relief to Cubans located in the eastern province of Guantánamo-Baracoa. This is one of two shipments Caritas Cuba has sent out in May. This most recent shipment included two containers of food and hygiene supplies, which are set to be distributed to at least 8,800 families in La Milagrosa, Santa Rosa de Lima, in Imías, and San José Obrero, as well as other eastern rural communities.

As of Caritas Cuba’s most recent update, 82 percent of the initial $3 million in U.S. humanitarian assistance had already been distributed. Given the pace of disbursement, it is likely that the full amount has now been distributed or is nearly exhausted. The US committed an additional $6 million in assistance in February, which will be released once the initial tranche is fully distributed. As with the first round of aid, the funds are to be delivered independently of Cuba’s government.

Nirint Shipping Removes Halifax as Shipping Destination from Cuba

As of June 22, the Netherlands-based shipping company Nirint has removed Halifax, Canada, from its Europe—Cuba–Canada shipping leg. Now, in addition to the Cuban seaports of Mariel and Moa, the shipping company will only operate out of Villagarcia, Spain; Bilbao, Spain; and Rotterdam, Netherlands. The elimination of the Canadian route reduces Cuban reach through Nirint to only European towns, eliminating another economic tether on the island. This decision comes after intensifying U.S. sanctions on the island, with the French shipping company CMA CGM and the German shipping company Hapag-Lloyd halting their shipments to Cuba in early May.

IN CUBA

Cuba’s Government Releases Its Youngest Political Prisoner

On June 24, Cuba’s government released Jonathan David Muir from custody after 3 months in the Canaleta maximum-security adult prison. At 16-years-old, Muir was detained on March 16 alongside his father, Pastor Elier Muir Ávila, for protesting in his hometown of Morón, Ciego de Ávila. While his father was released the same day as their arrest, Muir was charged with “sabotage”, a sentence of up to 15 years in prison. During his three-month stay at Canaleta, reporters stated he failed to receive sufficient medical attention, leading to bacterial infections, malnutrition, and depression.

Both Human Rights First and Amnesty International had called for Muir’s immediate release, determining that his life and health were at risk while in prison. Following his release, he was placed under house arrest, per Article 36 of the Cuban Penal Code.  Under house arrest restrictions, he is prohibited from speaking with the public.

IACHR Rules in Favor of Maykel Obsorbo’s Release

On June 23, the Inter-American Commission on Human Rights (IACHR) ruled that Cuba’s government mistreated Cuban artist and activist, Maykel Castillo Pérez, during his 2021 arrest and subsequent 9-year prison sentence. Castillo Pérez, also known as Maykel “Osorbo”, is the co-author of the protest song Patria y Vida and the co-founder of the San Isidro Movement (MSI), an artistic and political movement founded in 2018.

His case stems from a filing by Prisoners Defenders, which argued that Castillo Pérez was not in violation of the law during his 2021 arrest and that his imprisonment on the grounds of public disorder was without merit. Instead, the organization argued that it was a “politically driven conviction” and an act of censorship against the Cuban people. The IACHR ruled in Castillo Perez’s favor, recommending that Cuba overturn his conviction and compensate him for all damages accrued.

Cuban Tourism Sector Continues to Struggle as Foreign Entities Flee

The tourism industry in Cuba continues to plummet, with the National Office of Statistics and Information of Cuba (ONEI) reporting a 58.4 percent decrease in tourist numbers compared to last year. This was a similar case in 2025, where the number of tourists in Cuba was estimated to have dropped by 25 percent compared to 2024. The loss in foreign visitors is paralleled by U.S. sanctions, with many airlines and hotel chains suspending operations on the island indefinitely. Of the hotels that remain operational, ONEI estimated that roughly 13 out of every 100 rooms were occupied.

Cuba’s tourism sector continues to be sustained by the large number of Cuban Americans who visit their friends and family. While this number declined significantly as travel policies became stricter and the island's economic conditions worsened, in the first five months of 2026 the influx remained relatively stable. In March this year, the Cuban community amounted to the highest number of visitors traveling to the island.

Overall, Cuba has seen its total tourist arrivals decrease by 74.7 percent this year, from 122,207 international stopover visits in May 2025 to only 30,883 a year later. Canadian tourists, who make up the majority of Cuba’s tourism sector, decreased by 67.4 percent, with Cuba having seen only 21,000 U.S. travelers through April this year.

Chinese Site Expansion on Cuban Soil

On June 18, the Center for Strategic and International Studies (CSIS) published a report detailing new activity at a potential Chinese listening site in Bejucal, Cuba, where Soviet nuclear warheads were previously stationed in 1962. In 2024, CSIS identified the site as a strategic location for foreign intelligence collection. They pointed to the site's equipment, noting that it could support signals intelligence collection, with it now including 32 large antennas and an improved linear antenna grid.

As Cuba only sits 100 miles from Florida, the U.S. is suspicious of Cuba’s potential to facilitate intelligence operations, as the site could observe military activity, naval operations, and shipping traffic throughout both the Eastern US and the Gulf of Mexico.

On June 24, the Chinese government denied U.S. allegations regarding Bejucal, accusing the US of ulterior motives within the region. They emphasized that while China and Cuba are “good comrades”, its cooperation is transparent. 

Airlines Continue to Scale Back Flights to Cuba

On June 15, Delta announced that it would reduce its operations in Cuba, including suspending its direct flight between Atlanta and Havana and cutting its flight frequencies from Florida in half. The airline received a temporary dormancy waiver from the U.S. Department of Transportation (DOT), allowing it to temporarily withdraw without surrendering its long-term aviation rights. 

Cayman Airways also suspended its direct flights from Grand Cayman to Havana, referencing insufficient fuel and inadequate consumer demand as constraints on the route. The suspension will go into effect on June 26, placing yet another restriction on Cubans trying to find paths to the island.

Delta and Cayman Airways' decisions follow similar moves by several Canadian airlines that indefinitely suspended flights to Cuba in early June, citing the island's ongoing fuel shortage and heightened regional tensions.

Gen. Ramiro Valdés Menéndez Dies at 94

On June 21, former Cuban Vice President and General Ramiro Valdés Menéndez died at 94 years old. Valdés Menéndez was a founding member of the Central Committee of the Cuban Communist Party and its Political Bureau, and took part in Fidel Castro’s Granma expedition of 1956 to overthrow the Batista government. Later, he was instrumental in the creation of Cuba’s state security intelligence service, having served as interior minister. President Díaz-Canel said on X that his death hurts “like that of a father.”

CUBA’S FOREIGN RELATIONS

Mexico Discusses Restarting Oil Shipments in Cuba

On June 22, Mexico’s President Claudia Sheinbaum expressed Mexico’s intention to restart oil shipments to Cuba through the island’s private sector, as opposed to state-owned companies. By exporting only to the private sector, Mexico would avoid U.S. sanctions. President Sheinbaum also mentioned leveraging Cuba’s newly approved free-market reforms, citing the many Mexican-owned businesses already operating there as potential avenues for investment. Prior to January 29, 2026, Mexico was a top oil exporter to Cuba: a standing that was lost after the US threatened sanctions on any country that supplied oil to the island. This caused Mexico to halt its oil shipments earlier this year, with the last shipment to Cuba arriving before the capture and extraction of Venezuela's Nicolás Maduro.

European Parliament Urges Sanctions on Cuba’s President and GAESA

On June 18, Members of the European Parliament (MEPs) adopted a resolution calling for economic and political change in Cuba. The resolution denounced Cuba’s repression of 1,281 political prisoners, demanding their release and subsequent compensation. They also urged all countries within the European Union to adopt sanctions against Cuba, mentioning both President Díaz-Canel and GAESA as necessary targets. Calling for an end to repression, the MEPs advocated for full, multi-party democracy in Cuba, and urged member states to provide any humanitarian assistance possible directly to the Cuban people.

Vietnam Delivers Rice and the Vietnamese Foreign Minister Visits Cuba

On June 16, AgriVMA, a Vietnamese rice producer, provided 1,200 tonnes of rice to the Cuban company Los Palacios. The delivery is made under an agreement between Vietnam’s Ministry of Agriculture and Environment and Cuba’s Ministry of Agriculture, in which Cuba provides land and labor to Vietnam in exchange for agricultural support. This marks the second delivery completed under this bilateral agreement in 2026. Under the agreement, AgriVMA has supported Cuban rice cultivation by providing farming equipment, seeds, and machinery. With this support, rice yields on AgriVMA’s farms in Pinar del Rio province have reached 9 tonnes per hectare.

Alongside this rice exchange, Vietnamese Foreign Minister Le Hoi Trung visited Cuba on June 23 to meet with President Díaz-Canel and other Cuban officials. Their discussion pertained to ongoing Cuba-Vietnam relations and future opportunities for Vietnam’s investment in food cultivation and renewable energy production in Cuba. The visit occurred only days after Cuba’s announcement of free-market reforms, as it seeks to expand foreign investment.

Panama Offers to Mediate U.S.-Cuba Relations

On June 22, Panama's Foreign Minister, Javier Martínez-Acha Vásquez, declared Panama a neutral mediator to host diplomatic discussions between Cuba and the United States. Vásquez made his announcement during a press conference related to the 56th General Assembly of the Organization of American States (OAS), whose meetings are currently being held in Panama City. Martínez-Acha’s announcement has yet to receive a direct response from Cuba or the US.

Cuba Supports Puerto Rican Sovereignty at UN Committee Hearing

On June 16, Cuba reaffirmed its commitment to support Puerto Rican self-determination during the UN’s Special Committee on Decolonization. Cuba’s Permanent Representative at the UN, Ambassador Ernesto Soberón Guzmán, emphasized that the U.S. Supreme Court continues to exercise judicial power over Puerto Rico, reducing its sovereignty and limiting the island’s economic and social development. His declaration echoes Cuba’s historical stance that Puerto Rico continues to be a colonial territory, and that U.S. dominance on the island must end. This statement comes as U.S. officials affirm that Puerto Rico will play “an important role” in U.S. strategy towards Cuba in the Caribbean moving forward.

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