Raul Castro and Cuban Economic transformation

The Cuban economy is based on Soviet-style planning and has a great influence on the policies and efforts of President Raul Castro. The reforms introduced by him gave a new fillip and hope to the island nation. Cuba under Raul Castro saw path-breaking improvements to the island’s socio-economic conditions although many are still under-progress as the rate of change or growth has gradually slowed over time. The most notable economic measures launched by him in 2011 will now have to face a tough phase of transition in leadership at the helm which has been in place for decades.

Raul Castro has been a highly effective head as he successfully turned around the crude rebel army into a formidable force which earned respect in the country after excellent victories in Africa. After accomplishing military enhancement and modernisation, he channelized his energies into the revitalisation of domestic economy which was breaking off the seams. He dived deeper into the problem to get to the roots to discover that the influence of centralised socialist model taken from Soviet which had its own structural gaps. He thus strongly pushed for the market–directed business policies in the military while he was the minister of armed forces and didn’t hesitate in sending his officers out of the country to pursue business studies. The fall of Soviet Union had a devastating impact on Cuban economy which was thrown into a deep recession. Raul Castro took on the challenge to resurrect the economy by painting economic recovery as a solid foundation for national security.

Economic restructuring

Raul Castro was strongly pitted against all forms of economic inefficiency and opened a new economic front against the glaring fault lines and the lined up excuses. He unleashed the most ambitious initiative of economic transformation which opened gates for FDI along with a significant push to private and demanding the closure of all loss-making state enterprises. Raul’s vision was to create an economy which imbibed all the benefits of market-efficiency while promoting socialist principles of equality and free healthcare and education. A total of 313 reforms were started in 2011 of which only 21 percent have seen completion primarily due to a cautious approach by the officials who fear they point towards capitalistic trends. The Cuban government still continues to support and fund failing state-owned firms in forms of subsidies amounting to 20 percent of the state budget. The country did see a tremendous increase in the number of private players over the years but the growth is arrested due to new regulations. The annual target of attracting about $2.5 billion in FDI, the ground reality is way different.

Perpetual state

Raul Castro’s leadership was endowed with his sharp vision for future. He realised the need of the country was not just charismatic leadership but fortified institutions which can shoulder the responsibility of taking the nation to new heights after the historic leaders. He thus strongly believed that leadership positions should be offered to people who have achieved a lot in their lives as opposed to young inexperienced people. He also ensured that the maximum term limits of all senior members were a maximum of two 5 years terms in addition to introducing collective leadership where all major issues were discussed by debate and consensus building.

Personal liberties and state

Raul has championed the cause of personal liberties in Cuba being at the top of the national security machinery. He abolished many regulations and prohibitions by which many social dealings were subject to strict control of the state like allowing the use of cell phones, allowing people from Cuba to stay in tourist hotels, the sale of cars, internet connectivity etc.  Thus, his version of Fidel’s policy “within the revolution, everything. Against the revolution, nothing” was highly diverse as he broadened the realm of “within the revolution”. The opening of the internet, although came with risks especially in the wake of US staging, repeated efforts to destabilise the regime, yet the Raul did not hesitate as this was the call of time and necessary to open the people to a world of knowledge.

Engaging with the US

The diplomatic relations with the US did move forward under Obama as the embassies were re-opened and many agreements were signed on a bilateral front. This improved people-to-people exchange. However, President Trump has been critical and wary of maintaining the above relationship and considerably reduced staffing at the US embassy in Havana thus crippling its functioning. This followed by diplomatic expulsions by the US. Thus, the open hostility of Trump administration has reinforced anti-US sentiment among the conservatives who have always cast doubt over the US intentions.

Thus, the transition of leadership is also a signal to the institutional strength of the Cuban regime but the new leader will have to deal with the fundamental yet incomplete economic reforms in addition to plummeting ties with the US. The legacy of Raul Castro thus has to be carefully carried forward and assisted to completion.



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