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The Cuban economy contracted by approximately 5% in 2025, according to estimates from the Center for the Study of the Island's Economy (CEEC), an official body, confirming the third consecutive year of decline and raising the total fall of the Gross Domestic Product (GDP) to over 15% since 2020.
According to the report from the CEEC for the second half of 2025, the country's economic performance was primarily marked by the energy crisis, which has been affecting the island since mid-2024 and has had a ripple effect on the rest of the productive sectors, as reported by the agency EFE.
So far, the Cuban regime has not released complete official figures, although President Miguel Díaz-Canel recently acknowledged that the GDP decreased by 4% during the first three quarters of the year.
Stagnation and lack of reforms
"The behavior of the economy established a pattern of stagnation and lack of recovery," the report notes, identifying among the main causes the decline in external revenues, the downturn in tourism, the deterioration of the energy system, and an adverse international environment, further marked by increased pressure from the United States.
The CEEC also emphasizes the lack of deep structural and macroeconomic reforms, although it acknowledges that the government has managed to reduce the fiscal deficit "to levels deemed manageable."
"The dynamics of the Cuban economy in 2025 were consistent with the use of an exhausted economic model, lacking effective means to transform a reality in need of structural changes," warns the document.
The energy crisis as the axis of the collapse
The report highlights that the energy crisis served as the main driving factor for the rest of the economy. In this regard, electricity generation fell by 13.7% year-on-year, while the National Electric System (SEN) was deemed "critical" due to the aging of thermoelectric plants, many of which were built in the 1960s and 1970s with Soviet technology.
Inflation, loss of purchasing power, and social deterioration
Regarding inflation, the CEEC reports an official figure of 14.07% for 2025, but acknowledges that there are much higher unofficial estimates, placing the increase in the cost of the basic basket at around 70% year-on-year.
The consumer price index, according to data from the National Office of Statistics and Information (ONEI), tripled between 2021 and 2024, while independent experts believe that the actual inflation has been even higher.
The study discusses an “accumulated erosion of purchasing power,” as salary increases in the state sector have not compensated for the impact of inflation, resulting in a marked deterioration of social conditions.
Among the most alarming indicators, the CEEC mentions the increase in infant mortality, which rose from historically low levels to 9.8 per thousand live births, and massive migration, with an estimated loss of 1.5 million residents over the past five years.
2026: a scenario dominated by uncertainty
In anticipation of 2026, the research center describes a landscape "dominated by uncertainty," particularly due to the situation in Venezuela and the impact of new energy restrictions, a scenario that could further exacerbate the crisis.
In that context, the CEEC considers the 1% growth forecast announced by the Cuban government to be optimistic.
"Cuba is going through a critical juncture, characterized by the overlap of multiple crises: social discontent, stagnation of the economic model, institutional questioning, and an open debate—explicit or not—about the country's project," the report concludes.
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