Economy of Cuba

Cuba has a developing planned economy dominated by state-run enterprises. The Communist Party of Cuba maintains high levels of public sector control and exerts significant influence over the Cuban economy. The island has a low cost of living, inexpensive public transport, as well as subsidized education, healthcare, and food. Cuba's economic growth has historically been weak due to high labour emigration, import dependency, an ongoing energy crisis, foreign trade sanctions, and limited tourism in Cuba. The dual economy of Cuba has led to a series of financial crises. Cuba is one of the poorest countries in Latin America and the Caribbean with high inflation, collective poverty, and food shortages. It is heavily indebted due to its large public sector and high deficit spending, with a global sovereign debt burden.

In the 19th century, Cuba was one of the most prosperous pre-industrial Latin American countries with the export of tobacco, sugar, and coffee. At the Cuban Revolution of 1953–1959, during the military dictatorship of Fulgencio Batista, Cuba was on a growth trajectory within Latin America. During the Cold War, the Cuban economy was heavily subsidized – 10% to 40% of Cuban GDP in various years – by the Eastern Bloc, due to their geopolitical alignment with the Soviet Union. Cuba endured severe economic downturn when the Soviet Union collapsed, with GDP declining 33% between 1990 and 1993. A protracted economic malaise known as the Special Period overcame Cuba from 1991 to 2001. The Cuban economy rebounded in 2003 with marginal liberalization and foreign support from Venezuela, China, and Russia. The United States has maintained an economic embargo against Cuba since 1960 due to geopolitical tensions. Cuba has free-trade agreements with many world nations.

Although Cuba belonged to the high-income countries of Latin America since the 1870s, income inequality was high, accompanied by capital outflows to foreign investors. The country's economy had grown rapidly in the early part of the century, fueled by the sale of sugar to the United States.

Before the Cuban Revolution, in 1958, Cuba had a per-capita GDP of $2,363, which placed it in the middle of Latin American countries at the time. According to the UN, between 1950 and 1955, Cuba had a life expectancy of 59.4 years, which placed it in 56th place in the global ranking.

Its proximity to the United States made it a familiar holiday destination for wealthy Americans. Their visits for gambling, horse racing, and golfing made tourism an important economic sector. Tourism magazine Cabaret Quarterly described Havana as "a mistress of pleasure, the lush and opulent goddess of delights". Cuban dictator Fulgencio Batista had plans to line the Malecon, Havana's famous walkway by the water, with hotels and casinos to attract even more tourists. The country was highly dependent on its sugar production.

In the late 1950s, Cuba's oil sector was controlled by three large international oil companies: Standard Oil of New Jersey (Esso), Texaco, and Royal Dutch Shell.

On 3 March 1959, Fidel Castro seized control of the Cuban Telephone Company, which was a subsidiary of the International Telephone and Telecommunications Corporation. This was the first of many nationalizations made by the new government; the assets seized totaled US$9 billion.

After the 1959 Revolution, citizens were not required to pay a personal income tax (their salaries being regarded as net of any taxes). The government also began to subsidize healthcare and education for all citizens; this action created strong national support for the new revolutionary government.