This Thursday, Cuba's National Assembly of People's Power (ANPP) convened for its Third Extraordinary Session to deliberate and approve a set of 176 proposals for economic and social transformations. Among the most notable changes is the shift from state-owned socialist enterprises to joint-stock companies, as reported by the state-run newspaper Granma.
The session took place at the Havana Convention Palace, with virtual attendance by General Raúl Castro and the in-person presence of leader Miguel Díaz-Canel.
Prime Minister Manuel Marrero Cruz introduced the proposed transformations, organized into 23 key areas derived from 390 suggestions, 66.7% of which were accepted. The Political Bureau also added 69 additional recommendations.
Marrero Cruz described the current situation as "the most challenging context faced by the country since the Special Period," attributing the crisis to U.S. sanctions and internal errors, while avoiding acknowledgment of the systemic issues from over six decades of centralized management.
Key Reforms in Economic Management
The transformation of state-owned socialist enterprises into joint-stock companies is the most significant measure within Axis 1, focused on the management model of economic actors.
The document states that "henceforth, what is approved for other actors will apply to the state-owned socialist enterprise."
Complementary measures in this axis include empowering the business system to operate on equal terms with other economic actors, decentralizing the approval of wholesale and retail prices, eliminating the state wage scale, establishing a minimum salary negotiated with workers, and abolishing state subsidies for enterprises.
Expanding Economic Autonomy
Furthermore, Superior Organizations of Business Management (OSDE) are authorized to create state-owned companies and small and medium-sized enterprises (SMEs), while provincial and municipal governments can create, merge, or dissolve local state-owned enterprises.
The approved package extends beyond the state business sector. It includes reforms such as allowing private banking for the first time in decades, opening investment opportunities for Cubans living abroad, removing general price caps, and reducing the number of ministries from 27 to between 20 and 21.
The government sought ideological support for these measures by quoting Fidel Castro from 1993: "Life, reality, the dramatic situation the world is experiencing forces us to do what we would never have done otherwise if we had had capital and if we had had the technology to do so."
A Shift Without Abandoning Socialism
Marrero Cruz emphasized that these reforms do not signify a departure from socialism: "These actions do not constitute a surrender, but a sovereign adaptation of development tools to the country's specific circumstances."
The process leading to this session was expedited. On June 12, Díaz-Canel publicly announced the economic reforms, on June 17, the PCC Central Committee Plenum provided political support, and this Thursday, the ANPP formally approved them in record time.
This structural change comes at a time when, according to 2023 data, Cuba had 2,422 state-owned enterprises, over 5,000 cooperatives, and 270 fully Cuban-owned joint-stock companies. The regime now seeks to reorganize this ecosystem under commercial legal frameworks while maintaining, at least in official discourse, state control over the economy.
Frequently Asked Questions About Cuba's Economic Reforms
What are the main changes in Cuba's economic reform?
The main change is the transformation of state-owned socialist enterprises into joint-stock companies. Additionally, reforms include the authorization of private banking, investment opportunities for Cubans abroad, and reducing the number of ministries.
Who announced these reforms?
Prime Minister Manuel Marrero Cruz presented the reforms, and they were announced publicly by Miguel Díaz-Canel on June 12, with political support from the PCC Central Committee.