December 20, 2019 / 5:53 PM / a month ago

Cuban economy still afloat despite U.S. sanctions: official

HAVANA (Reuters) - The Cuban economy remained barely in the black this year given punishing new U.S. sanctions, the country’s economy minister said on Friday, forecasting 1% growth in 2020.

A general view during a session of the Cuban National Assembly in Havana, Cuba, December 20, 2019. REUTERS/Stringer

The Communist-run government has called on Cubans to “resist” and “develop” the economy amidst fuel, food, medicine and other shortages this year as a patriotic duty in the face of renewed hostility from its Cold War foe.

“Amid the limitations and thanks to the efforts of the people, it is estimated that the Cuban economy did not decrease in 2019,” Alejandro Gil told a session of the Cuban National Assembly broadcast on state-run television.

The administration of U.S. President Donald Trump has ratcheted up the longstanding trade embargo. It has sanctioned more than 200 Cuban companies, as well as Venezuelan and other foreign ships and companies involved in the Venezuela-Cuba oil trade which the Caribbean island depends on.

“We have been facing additional restrictions with the availability of fuel, affecting, among others, public transport, forcing us to temporarily paralyze some investments and decrease the pace in others and impacting agriculture, food production and distribution and other lines of high economic and social importance,” Gil said.

Travel to the island has been further restricted and U.S. citizens are now allowed to sue foreign companies deemed to be trafficking in Cuban properties nationalized after Fidel Castro’s 1959 revolution, damaging investor appetite.

Gil had forecast 0.5% growth this year after a 2.2% increase in 2018. He said the government was still compiling data on this year’s economic performance and final figures would be available next year.

Already heavily in debt to foreign governments, partners and suppliers due to the implosion of ally Venezuela’s economy, Gil said austerity measures aimed at repaying debt and resisting U.S. sanctions would remain in effect in 2020 and might have to be increased.

The measures include steep cuts in fuel allocations to agriculture and other sectors, reduction of imported fertilizer and animal feed, cuts in electricity use and even cooking with wood at some bakeries and schools.

Gil said priority would continue be given to increasing exports, reducing imports, attracting investment and savings on fuel and other resources.

As is customary, he gave no updated figures on trade, the debt and current account.

Reporting by Marc Frank; Editing by Richard Chang

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