Cuba’s economic growth is less than 2% this year and remains 8 percentage points below pre-pandemic levels, while output in sectors such as agriculture, mining and manufacturing is lagging, Economy Minister Alejandro Gil said on Saturday, as quoted by Reuters and News.ro.

Demonstration of Cubans in HavanaPhoto: AA/ABACA / Abaca Press / Profimedia

Speaking before the communist country’s legislature, Gill said the primary sector, which includes agriculture, mining and other basic production, fell 34.9 percent from 2019, while manufacturing fell 20 percent.

The third sector, which includes services such as tourism, communications and education, fell by 4.9%.

Cuba, which is heavily dependent on food, fuel and other imports, largely blames US sanctions and the coronavirus pandemic for the more than 50 percent drop in export earnings needed to buy imports, while acknowledging that market reforms have moved too slowly in the island nation.

Gil said export earnings this year were $1.3 billion, 35.7 percent of what was expected, while imports were $4.4 billion, also well below the Cuban government’s forecast.

Official inflation in Cuba is approaching 50%.

The minister said prices have risen 45 percent this year, on top of last year’s 39 percent rise, a figure many economists believe understates inflation because it does not properly account for the rise in the informal market fueled by shortages.

Cuba has resorted to tightening price controls to slow inflation, with little success so far, acknowledging that other factors are driving up prices, such as low productivity and output.

“If there is no supply and production, we will not be able to achieve effective price control,” Esteban Laso Hernandez, president of Cuba’s legislature, said during a meeting earlier this week.

Gill said the crisis, which has hit residents hard, forcing them to protest and flee the island nation, was “complicated” but added that the government was working on solutions.

“The gradual recovery of the Cuban economy has not yet reached the necessary pace,” he said. “Growth (this year) is very slow, 1.8%, and at the same time asymmetric. That is, it is not observed in the manufacturing industries.”