The U.S. oil blockade against Cuba is heavily burdening the island’s nascent private sector, where hundreds of small businesses have closed or suspended operations, while others are reinventing themselves and fighting to survive.
U.S. pressure, combined with the structural crisis the country was already enduring, is creating an environment for private Cuban entrepreneurs that is as adverse as it is uncertain. This is particularly challenging for a group Washington has stated on more than one occasion that it intends to support, as the lack of fuel strikes them on multiple fronts.
Without fuel, neither workers, suppliers nor customers can count on reliable transportation; this disrupts supply chains and internal labor organization, while also dampening consumer demand. Furthermore, power outages are becoming prolonged since a portion of the national power generation relies on diesel and fuel oil, thereby undermining economic activity.
Lacking fuel, private businesses (estimated at around 10,000 across the island) are also unable to ensure a steady power supply using their own backup generators, vital for establishments such as bakeries or shops selling refrigerated goods.
Moreover, during power outages, mobile and wired connectivity frequently fail, thereby eliminating the possibility of remote work and extinguishing any glimmer of a digital economy.
“It has affected us deeply. After all, we are a logistics and delivery company,” Cuban entrepreneur Marta Deus acknowledged to EFE. She heads the popular platform Mandao — the island’s equivalent of food delivery apps such as Glovo, Rappi, or Uber Eats.
With a staff of 50 employees, orders have dropped by 50% since the oil blockade began, settling at an average of 120 per day. The core staff remains intact, although adjustments have been made regarding external services.
She recounts that restaurants have closed or scaled back their operations; that they have had to purchase an electric vehicle to transport their workers to the central office and back home; and that they acquired electric bicycles and scooters for deliveries.
Deus explains that the adaptation process has been “very complicated,” but that they have leveraged the experience they had been accumulating in the provinces, where long power outages and fuel shortages had already been the norm for some time.
Furthermore, this entrepreneur asserts that, so far, she has been unable to import fuel, despite the measures announced by the U.S. to facilitate shipments to the island’s private sector. “Regarding fuel, we are at zero. Personally, we haven’t managed to secure any yet. It’s not a simple matter. We are in the process,” she notes.
In Havana — home to nearly half of the micro, small and medium-sized enterprises (MSMEs) that have emerged in Cuba since they were once again permitted in 2021, following a ban of nearly six decades — many restaurants, cafes and retail establishments have closed their doors in recent months.
Many others, ranging from service enterprises to small guest houses, are weighing every option on the table in the face of the serious difficulties they currently confront, as well as the absolute uncertainty with which they face the future — a future in which anything seems possible, even a U.S. military intervention.
Reinventing themselves
Others have decided to remain open. Laura Salazar, the manager of Loft Bahía — a hotel, restaurant and café complex in Old Havana — told EFE that she is committed to innovating during this crisis, just as the business has done in the face of every previous challenge it has encountered.
“Since opening, Loft Bahía has had to contend with a great many limitations. We opened in the wake of the pandemic; it has been a period in which we have almost constantly been facing a bit of a downhill battle,” she explains.
She describes how they have chosen to seek out new “market segments” in the face of declining tourism, secure transportation for employees, reorganize staff shifts and arrange new activities to attract different audiences. “We’ve had to reinvent ourselves,” she summarizes.
She views the crisis with optimism: there’s simply no other choice, she believes. “It’s part of what we’ve experienced ever since we opened. Right now, the issue is oil, but in previous months and years, there was always some other challenge, and we’ve continued to reinvent ourselves despite it,” she notes.
“As circumstances beyond our control improve, so will we. Our outlook is optimistic,” this entrepreneur concludes.
