A good friend in Sydney once called all
the way to suggest that I should write something about the injustice of the US
towards the long-suffering Cubans. Cuba has not been on my radar all along,
save for knowing that recently Trump has been trying to think of reasons to
destabilise Cuba.
However, the headlines carried in most of today’s mainstream media say it is time for me to write something about the Cuba-US relationship.
CNN’s headline screams: “Raúl Castro indicted in a prosecution that has been in the works for 3 decades.”
It is an old story. Castro is already 94 years old. In 1996, more than 30 years ago, Cuban fighter jets shot down two small planes – belonging to a group of Cuban exiles in Miami – in the waterway between the Caribbean island nation and the US state of Florida, killing all four on board. Castro was Cuba’s armed forces minister at that time. It led to the US tightening sanctions against his brother Fidel Castro’s regime, plunging the island into severe economic hardship marked by blackouts, food shortages and fuel scarcity.
The Cubans maintain that the incident occurred over their airspace. The movement “Brothers to the Rescue” posed a threat to national security because of its repeated air incursions.
The indictment is likely to trigger a sharp escalation in tensions between Washington and Havana. The Trump administration is applying the same playbook used against Venezuelan leader Nicolás Maduro. By establishing a formal criminal indictment against Cuba's senior leadership, Washington has effectively created what it views as a legal basis for aggressive intervention or even a potential takeover. Acting Attorney General Todd Blanche underscored this by saying the US expects Castro to appear in a US courtroom “by his own will or by another way.”
Regardless, the move probably extinguishes any remaining hope for diplomatic normalization between the two countries. The indictment comes as Cuba is already enduring its worst economic crisis in six decades, and intensifying pressure could push the island towards a major humanitarian emergency. Yet in the US, anti-Castro and Cuban-American exile communities in South Florida are celebrating what they see as a 30-year-delayed act of justice for the four pilots killed in 1996. But are they condemning their compatriots to further misery?
All for the sake of the mid-term
elections?
Economically, Cuba is in its worst condition since the collapse of the Soviet Union in 1991. This is not merely a period of low growth but a systemic breakdown affecting electricity, transport, food supply, healthcare, and daily life.
It is said that Cuba’s economy has contracted another 5% in 2025 alone, after years of stagnation and decline. Since 2020, total contraction may exceed 15%. Inflation has devastated purchasing power. Official inflation was about 14%, but estimates for basic necessities are far higher, with some placing food inflation at around 70%.
Blackouts are routine because Cuba lacks fuel and its Soviet-era power plants are deteriorating badly. In some regions, outages reportedly last 12–16 hours daily. Food, medicine, and fuel shortages are severe, while public transportation has periodically collapsed in Havana because diesel simply was not available. Tourism, once a major hard-currency earner, has also not fully recovered after COVID and worsening sanctions.
Cuba is experiencing a major demographic exodus as well. Roughly 1.5 million people are estimated to have left over five years – enormous for a country of only about 11 million people.
Externally:
• The long-standing US embargo remains a major constraint.
• The Trump administration has tightened sanctions again, including measures
targeting shipping, finance, and fuel flows.
• Venezuela, which once supplied subsidised oil, is no longer able to support
Cuba at previous levels.
Internally:
• Cuba’s economy suffers from chronic low productivity, over-centralisation,
currency distortions, weak incentives, and decaying infrastructure.
The country is exhausted!
There are allegations of corruption, privilege, and opaque wealth among parts of Cuba’s ruling elite. However, the situation differs from the openly oligarchic systems seen elsewhere.
Under Fidel Castro and later Raúl Castro, the Cuban state officially promoted egalitarianism and anti-corruption discipline. Compared with many Latin American countries, Cuba historically had relatively low levels of visible street-level corruption in areas such as policing or tax administration. The state also maintained harsh penalties for officials accused of graft.
However, like everywhere else, senior political and military circles enjoy privileges inaccessible to ordinary Cubans – special stores, better housing, imported goods, private transportation, and foreign currency access. The military conglomerate GAESA – historically linked to Raúl Castro’s inner circle – also controls large sectors of the economy, including tourism, retail, ports, hotels, and remittances. Corruption scandals periodically emerge, usually involving mid-level managers, customs officials, or state enterprises, though top leaders are rarely implicated publicly.
One notable episode was the 1989 case involving General Arnaldo Ochoa, a decorated military hero executed after being convicted on drug trafficking and corruption charges.
Economic hardship has naturally intensified public resentment towards elite privilege.
However, unlike some post-Soviet or
authoritarian states, there is little hard public evidence that Cuba’s
top leaders personally possess enormous offshore wealth on the scale associated
with oligarchic regimes elsewhere.
The racist in me loves to generalise about cultural weaknesses. I have only been to South America once, many years ago. I visited Argentina, Chile, Peru and Brazil. I thought I sensed a great degree of lethargy in these Latin American countries.
They never seemed in a hurry to change, hence my coining of this “disease.”
While Russia and China have evolved with their own brands of Communism, Cuba still appears trapped in inertia and reluctant to embrace reform on the same scale. The reasons are political fear, ideological rigidity, geography, and the structure of the Cuban state itself.
Deng Xiaoping launched China’s “reform and opening up” from 1978 onward, and post-Soviet Russia moved toward a market economy. Cuba, by contrast, only introduced limited reforms over the years – small private businesses, farmers’ markets, tourism partnerships, dollar shops, foreign investment zones, legalisation of some private restaurants and rentals, and more recently, legal recognition of small and medium enterprises.
Even though Cuba admires aspects of the Chinese and Vietnamese models, it never went nearly far enough. The leadership has long feared that large-scale economic liberalisation could eventually undermine political control. Yet the economy itself is structurally weak, heavily dependent on tourism, remittances, nickel exports, and imported fuel and food. Decades of US sanctions and financial restrictions have further compounded these weaknesses.
Today’s crisis is pushing Cuba towards reform anyway, though only in a hesitant and piecemeal fashion. Private businesses are growing, inequality is widening, informal dollarisation is expanding, and limited capitalism is increasingly tolerated. But the leadership still appears trapped between two fears:
• fear that reforming too slowly will collapse the economy, and
• fear that reforming too quickly will collapse the political system.
Havana may simply have waited too long. By the time deeper reforms became unavoidable, the country’s infrastructure, demographics, and productive base had already deteriorated severely.
Russia has helped, but far less than many Cubans hoped. After the Ukraine war began, Moscow spoke about reviving Soviet-era ties with Havana through investments in sugar, energy, transport, and tourism. Yet many projects have stalled because Russia itself is under heavy economic and military pressure.
Russia has supplied some oil shipments, wheat, credit arrangements and tourism income, but this is nowhere near the scale of Soviet-era subsidies during the Cold War. Russia simply lacks both the resources and strategic bandwidth to rescue Cuba economically.
China, meanwhile, has become more important. Rather than providing open-ended subsidies, Beijing appears focused on strategic infrastructure and targeted assistance. The most significant involvement is in energy, with China financing and helping build dozens of solar parks while also modernising parts of Cuba’s electrical grid and telecommunications systems.
China has also extended loans, increased trade, supplied industrial equipment, and expanded Belt and Road cooperation with Cuba. But unlike the USSR during the ideological Cold War, modern China behaves far more commercially and pragmatically. It does not appear willing to pour in unlimited subsidies without meaningful reforms and repayment prospects.
Chinese support may help stabilise Cuba’s electricity supply, but it is probably insufficient on its own to reverse the island’s broader economic decline. Neither Russia nor China appears prepared to underwrite the Cuban economy indefinitely.
The hostility between the US and Cuba is historical. The two peoples themselves are not natural enemies.
The US still maintains the Guantánamo Bay Naval Base in Cuba. There was never any permanent transfer of sovereignty. Cuba technically retains ultimate sovereignty over the territory, but the United States obtained perpetual control and use of the area under agreements imposed after the Spanish–American War.
The story begins in 1898. During Cuba’s war of independence against Spain, the US intervened militarily after the explosion of the battleship USS Maine in Havana harbour. Spain was quickly defeated, and Cuba formally ceased being a Spanish colony.
Although Cuba became nominally independent in 1902, the US occupied the island militarily for several years and exercised enormous influence over the new republic.
A crucial mechanism was the Platt Amendment, which Washington forced Cuba to incorporate into its constitution as a condition for ending the occupation. The amendment gave the US broad rights to intervene in Cuban affairs and authorised it to obtain naval stations in Cuba.
Under this pressure, Cuba signed the 1903 Cuban–American Treaty, leasing Guantánamo Bay to the United States for use as a naval and coaling station.
Under the arrangement, the US obtained “complete jurisdiction and control” over the area. And Cuba was supposed to retain ultimate sovereignty in a formal legal sense. But the lease was effectively perpetual unless both governments (meaning the US!) agreed to terminate it. (The annual rent was originally set at USD2,000 in gold coins, later adjusted to about USD4,000 per year.)
After Fidel Castro came to power, the Cuban government declared the treaty illegitimate, arguing that it had been imposed under coercion during a period of overwhelming US domination.
Since 1959, Cuba has repeatedly demanded the return of Guantánamo. Of course, the US has refused, insisting the treaty remains legally valid. Cuba reportedly cashes almost none of the annual rent cheques sent by Washington, treating them as symbolic evidence of an invalid arrangement. (Fidel Castro once claimed that only one cheque had ever been accidentally deposited shortly after the revolution.)
Today, the base remains strategically important to the US. It is the country’s oldest overseas naval base. After the September 11 attacks, part of it became globally controversial as the site of the Guantánamo Bay detention camp for terrorism suspects.
To many Cubans and much of Latin America, Guantánamo remains a lingering symbol of an era when the US dominated Caribbean affairs. To Washington, it remains a lawful treaty-based military installation of strategic value.
The US is determined to vassalise Cuba, much like what it is attempting to do to Venezuela and Panama. To Trump, this may appear the perfect moment, with Cuba’s backer Russia weakened economically and militarily.
After the Xi-Trump summit in Beijing a couple of days ago, one might have expected Trump to show some humility. But true to the saying, a leopard cannot change its spots: he has quickly returned to bullying and threatening those he sees as weaker parties. And today, it is Cuba.
While the world discusses the deals that may or may not have been struck in Beijing, Xi probably understands that agreements with Trump are fundamentally transactional and temporary. Trump wants to show American voters that he has extracted concessions from China, but once the mid-term elections are over, Washington will likely revert to imposing fresh sanctions and restrictions. Indeed, the US has just announced the indictment of four major Chinese container manufacturers and several executives for allegedly “conspiring to restrict production and fix prices during and after the COVID-era supply chain crisis.” What a joke.
Trump even brought Jensen Huang to
Beijing to encourage China to buy Nvidia chips. Yet almost immediately
afterwards, Commerce Secretary Howard Lutnick was again signalling that
Washington had no intention of fully lifting semiconductor restrictions on China.
He indicated that only lower-tier or specially modified Nvidia chips might be
sold to selected Chinese firms under strict conditions. This Epstein pal still
wants to have the cake and eat it too. China does not need these chips. (One
wonders why none of Huawei’s bosses attended the state banquet.)
I suspect Xi also believes Trump is one of the greatest gifts the American people have delivered to China. Chinese netizens nicknamed him “川建国” (Chuān Jiànguó) – combining “Trump” (川普, Chuānpǔ) with “nation builder” (建国, jiànguó) – humorously suggesting that Trump’s actions have unintentionally accelerated China’s rise. And perhaps Xi sees these gestures in Beijing as only a small price to pay.
The perception that “China is an enemy” has become so deeply rooted across both sides of the American political divide that Beijing probably cannot afford another Joe Biden at this point. Trump may simply be viewed as the lesser evil.
End