International banking expert and attorney Alberto Luzárraga, originally from Cuba, argues that the only viable solution for Cuba's economic woes is to immediately adopt the dollar, drawing parallels with the successful models of Ecuador and Panama. According to Luzárraga, this is the fastest way to halt the monetary collapse that is eroding the purchasing power of Cuban citizens.
In a conversation with CiberCuba following his participation in a symposium on the Helms-Burton Act organized by Patria de Martí, Luzárraga stressed, "We must initiate the process of dollarization; we have no other choice, as Ecuador and Panama have done."
Based in Miami and holding a master's degree in Law from Harvard, Luzárraga bases his proposal on the dire condition of Cuba's financial system. "There is no functioning banking system in the traditional sense, where banks take public deposits and provide loans to creditworthy and profitable businesses. That doesn't exist in Cuba," he warned.
The Challenges of Reforming Cuba's Banking System
Luzárraga points out that overhauling the Central Bank and the broader banking infrastructure is a lengthy process that cannot be rushed, and Cuba lacks the luxury of time. "Monetary policy cannot be improvised overnight," he emphasized, dismissing the possibility of institutional reconstruction preceding stabilization.
He believes that adopting the dollar would address the most pressing issue: providing Cubans with a stable benchmark for value. "If people don't know what to expect regarding the value of their money today and tomorrow, no one will want to run a business, and the economy cannot function under such uncertainty," Luzárraga explained.
A Roadmap for Economic Stability
Luzárraga offers a clear path forward: begin with dollarization, then move to institutional rebuilding, and eventually return to the Cuban peso. "We need to start by reorganizing the Central Bank to become a true issuing bank and reform the banking system. Once we achieve a stable, inflation-free economy, we can reintroduce the Cuban peso," he stated.
His insights come at a time of unprecedented monetary turmoil for Cuba. In December 2025, the regime recorded the world's most significant official devaluation for that year: a staggering 242%, with the peso plummeting from 120 to 410 per dollar.
Economic Fallout and Expert Opinions
On the black market, the dollar surged to 515 Cuban pesos in March-April 2026, while the average monthly salary on the island sank to less than $10. The Cuban GDP per capita fell to $1,082.8, the lowest in Latin America, following a 5% contraction in 2025, according to CEPAL.
Luzárraga encapsulates the severity of the situation succinctly: "On a scale of 1 to 10, Cuba rates at 10.5. It's dire."
The discussion about dollarization is not novel among exiled economic circles. Cuban-American businessman Carlos Saladrigas acknowledged in March 2026 that Cuba meets most conditions for dollarization, though he favors a preliminary stabilization phase for the peso lasting two to four years, at an estimated cost of $6 to $10 billion.
Luzárraga dismisses this delay, targeting the core of the issue: "The only way to achieve this is at least to stop the emission. If you eliminate the Cuban peso and cease emission, adopting another convertible currency like the dollar, there's no choice but to set reasonable and real prices."
The Ecuadorian example bolsters his case: when Ecuador adopted the dollar in January 2000 to combat hyperinflation and a banking crisis, inflation plummeted from 96% in 1999 to 7% by 2001.
Understanding Cuba's Dollarization Debate
Why does Alberto Luzárraga advocate for dollarization in Cuba?
Luzárraga believes dollarization is the only immediate solution to stop the monetary collapse and restore economic stability, similar to the successful strategies employed by Ecuador and Panama.
What are the challenges of reforming Cuba's banking system?
The overhaul of the Central Bank and banking system is a complex and lengthy process that cannot be improvised, and Cuba lacks the time to undertake such reforms immediately.
How did Ecuador stabilize its economy with dollarization?
Ecuador adopted the dollar in January 2000 to combat hyperinflation and a banking crisis, leading to a significant drop in inflation from 96% in 1999 to 7% by 2001.