Cuba Overview: Economy
Cuba's topography and climate are suitable for various crops, but sugarcane has been dominant since the early 19th cent. It remains the most prevalent crop, but in 2002 the government reduced the acreage devoted to sugarcane by 60%; prior to the cutbacks, it had been grown on about two thirds of all cropland. The abandoned cane fields were converted mainly to vegetable farms or cattle ranches. Nearly half the nation's sugar mills were also closed. Sugar and its derivatives are, nonetheless, still the most important exports. Other important exports include nickel, cigars, fish and shellfish, medical products, citrus fruits, and coffee. An excellent tobacco is grown, especially in the Vuelta Abajo region of Pinar del Río, and citrus, coffee, rice, corn, sweet potatoes, and beans are important crops.
Large-scale fishing operations have been encouraged in recent decades, and that industry is now one of the largest in Latin America; Cuban fishing fleets operate from Greenland to Argentina. Livestock raising has also been highly developed.
Manufacturing is centered chiefly in the processing of agricultural products. Sugar-milling has long been the largest industry, and Cuba is also known for its tobacco products. There is a oil-refining industry as well. Some consumer goods are manufactured, as well as construction materials, steel, agricultural machinery, and pharmaceuticals.
Although Cuba's nickel deposits are among the largest in the world, extraction is difficult because of the presence of other metals in the nickel ore. Nonetheless. nickel is the country's second most valuable export item (after sugar). Large amounts of copper, chromium, and cobalt are also mined, as well as lesser quantities of salt, lead, zinc, gold, silver, and petroleum. There are immense iron reserves, but problems of extraction and purification are even greater than with nickel, and iron production is still slight.
Cuba has upgraded its tourist facilities since 1990, and visitors from Canada, Europe, and elsewhere have revitalized the industry. Tourism is now the economic sector that provides the largest source of foreign income for the country, but the value of remittances of cash and goods from Cubans abroad is even greater. Venezuela, China, Canada, Spain, and the United States are the country's largest trading partners.
The Cuban economy has suffered severely from the collapse in 1990 of the Soviet bloc, upon whose trade Cuba was dependent; from the continuing effects of the U.S. trade boycott; and from internal structural economic problems. The economy recovered somewhat beginning in the mid-1990s, due to better economic planning, limited private enterprise, and an increase in productivity. The Venezuelan government, which developed close relations with the island, sold petroleum to Cuba at subsidized prices and provided other aid, and Cuba reciprocated by sending medical professionals and other personnel to Venezuela. By the mid-2010s, however, economic problems in Venezuela had drastically reduced sales of subsidized petroluem, and Cuba was again suffering from weak economic growth.
The Columbia Electronic Encyclopedia, 6th ed. Copyright © 2012, Columbia University Press. All rights reserved.
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