Economy
Cuba has a planned economy, and virtually all of its industries are owned and operated by the government. Nationalization began in 1959 after Fidel Castro came to power. Economic development under socialism has been relatively slow. Of crucial importance to the economy was Soviet financial aid and technical assistance. This ended in 1991, when the Soviet Union collapsed. Since 1993 the Cuban government has introduced measures legalizing some private enterprise, which resulted in the opening of small businesses, including restaurants and clothing stores by many Cubans. In 1995 a law was passed allowing foreign ownership of Cuban businesses.
Farming is the mainstay of the economy and employs nearly a fifth of the labor force. During the mid 20th century, almost all farms came under state control. Most farms were run as state farms, owned and operated by the government. Some farms were owned and operated by peasant cooperatives, which were owned jointly by the government and groups of farmers. Only a few small farms stayed under the control of individual owners. There is very little privately owned farmland. In any case, farmers had to sell their goods to the state at prices fixed by the government. But in 1994, farmers were authorized by the government to sell their surplus production on the open market after certain quotas had been met. In time, small farmers’ markets came up across the island and sold a variety of products, including fruits, vegetables, and other foods, directly to the public.
Sugarcane is by far the chief crop; by value, it provides about three-fourths of Cuba's exports. Cuba is one of the leading producers of sugar in the world. Tobacco is usually Cuba's second-largest agricultural export. Other important export crops include citrus fruit and coffee. Rice, corn, cassava, yams, tomatoes, bananas and potatoes are among the crops grown mainly for domestic consumption. Cattle ranching and dairy farming are becoming increasingly important. Hogs and chickens are also raised in an effort by the government to increase the production of livestock farming.
Since the revolution of the mid 20th century, Cuba's fishing industry has expanded rapidly, largely due to heavy investment in modernizing the commercial fishing fleet. State-owned Cuban fishing fleets range over the Caribbean Sea and parts of the North Atlantic Ocean. Lobster, tuna, and shrimp make up most of the catch. The important fishing ports are Caibarien, Cienfuegos, and Havana.
Mining, especially of nickel, has long been important. Cuba is a world leader in nickel production and as an export nickel is second in value only to sugar. Cuba's nickel reserves, which are located primarily near the Sierra del Cristal, on the eastern end of the island, are among the largest in the world. Other minerals produced include chromite, gold, iron ore, cement, stone, cobalt, and copper. . Small quantities of petroleum are produced in Cuba mainly for domestic use.
Manufacturing is steadily being expanded. A program of rapid industrialization around the mid 20th century, however, was unsuccessful; it was replaced in the 1970's by a program of slower, more carefully planned growth. Manufacturing employs about a fifth of the labor force. Sugar milling, petroleum products, food and beverage products, tobacco processing, the production of cement, steel, fertilizers, industrial chemicals, textiles, domestic consumer goods, and agricultural machinery are among Cuba's chief industrial activities. Nevertheless, manufacturing revolves around sugar production. Cuba has many sugar mills throughout the country. Another important business is the manufacture of cigars, whose factories are mainly in Havana. Cuba is renowned for fine hand-rolled cigars that are made from high-quality tobacco.
From around 1900 to 1960, Cuba’s main trading relations were with the United States. During the mid 20th century, about 65 per cent of Cuban exports and about 75 per cent of all imports were concerned with Cuban-U.S. trade. In the mid 20th century, Cuba’s trade was mainly with the Soviet Union and the Communist countries of Eastern Europe. By the late 20th century, about 85 per cent of all Cuban trade was with the Communist bloc. After the collapse of Communism, Cuba was in search of new trading partners. After 1991, Cuba's main trading partners became Canada, China, Germany, Italy, Japan, Mexico, Russia, Spain, Venezuela and countries of the European Union.
Prior to the revolution in the mid 20th century, tourism was an important part of the economy. Largely due to a United States ban on travel to Cuba and the development of other tourist areas in the Caribbean, tourism declined rapidly during the late 20th century. The tourist industry began to revive in the late 20th century, however, and experienced steady growth throughout the 1980's, mainly due to an increase in tourists from western Europe and Canada.
Sugar has always been Cuba's principal export product. Other exports include citrus fruits, coffee, fish and shellfish, medical products, nickel, rum, and tobacco products. The chief imports of Cuba are chemical products, food, machinery, and petroleum.
Cuba's basic currency is the Cuban peso.
Cuba's highway system extends the length of the island. Highways and other paved roads make up about a third of all roads. Paved roads of more than 19,000 miles (30,000 kilometers) crisscross the island. The Central Highway extends between Pinar del Rio and Santiago de Cuba. However, automobile transportation has some problems due to gasoline rationing, problems in obtaining spare parts, and a scarcity of new vehicles. Many people in the cities travel by bicycle.
Railways connect most of the major towns. The chief ports are Havana, Santiago de Cuba, and Cienfuegos. Cuba has a sizable merchant marine. Empresa Cubana de Aviación is the national airline and Jose Marti International Airport is the country's largest airport.
