“If small and medium-sized enterprises (SMEs) in Cuba could operate freely, many of the country's economic troubles would be resolved in just a month,” stated economist Elías Amor during an interview with CiberCuba on Thursday.
These remarks encapsulate his critical view of the new decree issued by the Cuban government, which allows partnerships between state-owned enterprises and Cuban SMEs. The regime touts this decree as a part of its economic model update.
Contrary to the official optimism, Amor urges caution, asserting that the initiative, as it stands, is unlikely to address the deep-rooted structural issues plaguing Cuba's economy.
“There should be no expectation of anything positive from this measure,” he commented on the decree's scope. In his opinion, it lacks a fundamental component: the basic principles of supply and demand, which have been disregarded in Cuba for decades.
“There’s no economic theory backing this,” he pointed out. “When politicians make decisions that contradict economic theory, disaster is the inevitable outcome.”
Advisory to Entrepreneurs: "Do Not Celebrate"
Amor issued a direct warning to Cuban SME owners and private business leaders in Cuba, urging restraint in response to the new decree.
“No SME should get too excited,” he said, referring to the expectations sparked among some entrepreneurs by the new regulation. He explained that unless there is a fundamental change in the legal framework governing business activities on the island, the growth of the private sector will remain at the mercy of state control.
For Cuban SMEs to genuinely stimulate the economy, certain basic guarantees are essential:
- Real business autonomy
- Freedom to expand without administrative constraints
- Ability to distribute profits among partners and investors
- Legal security for private businesses
Otherwise, everything will continue to hinge on the state's discretionary power. He emphasized that despite the new decree: “The Ministry of Economy can undo whatever it pleases.”
Amor acknowledges that the new regulation partially reflects the pressure exerted by the growth of Cuban SMEs on the regime. However, he regards the outcome as a bittersweet victory for the private sector.
In his view, the solution to Cuba's economic crisis lies in allowing private enterprises capable of generating wealth to expand, while unproductive state structures should either vanish or transform.
The New Government Decree on Cuban SMEs
On March 3, 2026, the Official Gazette published Decree-Law 114/2025 and Resolution 8/2026 by the Ministry of Economy and Planning, establishing the legal framework for associations between state-owned enterprises and non-state actors, including Cuban SMEs and cooperatives.
The regulation permits the creation of mixed limited liability companies, allows state entities to participate in existing private companies, or enables both parties to sign economic association contracts.
The Cuban government claims its goal is to boost productive linkages and enhance national production amid the crisis. However, all operations must be authorized by the Ministry of Economy and Planning, maintaining direct state control over these projects.
According to Amor, this design could lead to an unequal relationship between state-owned and private businesses in Cuba.
“This measure will only restructure the landscape of entities, allowing some state enterprises to capture powerful SMEs and put them to their service,” he remarked.
In his assessment, the real change would be allowing SMEs to operate freely without constant state intervention.
Understanding the Impact of the New Cuban Decree on SMEs
What is the main critique of the new Cuban government decree on SMEs?
The primary critique is that the decree lacks adherence to basic economic principles such as supply and demand, and maintains excessive state control, which could hinder the genuine growth and autonomy of SMEs.
How does the new decree affect the relationship between state and private enterprises in Cuba?
The decree could foster an unequal relationship, as state enterprises might exploit powerful SMEs, integrating them into state service rather than fostering true partnerships.