CubaBrief: Cuba says unable to pay off debt commitments in 2019

Havana announced it will not pay all of its debt commitments in 2019 blaming a hurricane and the United States. But the fundamental reason for its debt crisis is the disastrous economic policies began by Fidel Castro almost 60 years ago. Throughout the years after Castro failed to pay his creditors, many governments forgave the regime millions of dollars. Hurricanes are not a new development in the Caribbean and after Castro confiscated all American properties and Washington began the embargo Moscow came to the rescue. For many years the dictator said the embargo was a joke, that it had failed, that Cuba had a much better deal since Russia was a cow while the United States was a goat.

For over 200 years the sugar industry was the basis of Cuba’s progress. Cubans used to say “sin azúcar no hay país.” But the regime destroyed the island’s sugar industry Diaz Canel has bought French sugar.

Cuba’s economy will recover and prosper once there is freedom in Cuba, and Cubans are allowed to grow, sell, manufacture, trade, import and export.

People wading through a flooded street in Havana, on December 21, 2018: Cuba blamed last year's Hurricane Irma as well as US sanctions for the fact that it won't be able to pay off its debt commitments in 2019. (Photo: AFP/YAMIL LAGE)

People wading through a flooded street in Havana, on December 21, 2018: Cuba blamed last year’s Hurricane Irma as well as US sanctions for the fact that it won’t be able to pay off its debt commitments in 2019. (Photo: AFP/YAMIL LAGE)

HAVANA: Cuba’s government admitted on Friday (Dec 21) that it won’t be able to pay all its debt commitments in 2019, blaming Hurricane Irma and United States sanctions for its woes.

“In 2019, we’ll have less credit than the amount of debt we’re planing to pay,” said finance minister Alejandro Gil during a parliamentary session.

“There will be a level of debt that we won’t be able to pay next year and this will affect the performance of the economy.

“There is a high level of debt in the economy that creates daily tensions.

“We’ve been looking for specific solutions but it’s affecting the harmonious performance of the economy.”

Gil insisted that Cuba’s new loans would be marginally lower than the existing debts it will pay off, meaning that “we won’t be increasing our level of debt.”

Cuba recently defaulted on a part of its debt with Brazil and is behind in reimbursing another portion related to the construction of a port and purchase of food.

Havana blames these delays on the effects of Hurricane Irma, which made landfall in early September, and a hardening US embargo that hinders its international financial transactions.

Cuba’s government has said the economy grew by 1.2 per cent in 2018.