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The Cuban economist Pavel Vidal recently published an analysis on the portal Horizonte Cubano of Columbia Law School, in which he proposes a roadmap for structural reforms in Cuba and warns that the military conglomerate GAESA cannot be excluded from any real economic transformation process.
The text, titled “What to Prioritize in a First Phase of Economic Reforms in Cuba?”, is published amid preliminary diplomatic discussions between Havana and Washington, and in the context of the worst economic crisis the Island has faced in decades, with a cumulative GDP contraction of between 23% and 26% since 2019.
Vidal structures his proposal in three phases: the first focuses on stabilization and emergency transformations, the second on broader productive reactivation, and the third on the strategic definition of the long-term development model.
The most controversial point of the analysis is the treatment of Grupo de Administración Empresarial S.A. (GAESA), the conglomerate of the Revolutionary Armed Forces that controls between 40% and 70% of the formal Cuban economy, including the financial system, tourism, foreign trade, and international reserves.
"It is neither logical nor effective to design a national productive transformation that leaves it out," writes Vidal.
The economist goes further, suggesting that "if we want the reforms to have macroeconomic credibility, productive coherence, and social legitimacy, it will be necessary to advance in dismantling GAESA, reducing its monopolistic control, and transferring its functions to civilian and more transparent structures."
This position coincides with that of Cuban lawyer Alberto Luzárraga, who pointed out on April 25 that GAESA "is part of the problem that needs to be resolved", not part of the solution.
For the first phase, Vidal identifies two priority structural transformations.
The first is the correction of relative prices and the exchange rate, which is described as "probably the most significant shock of a market reform."
Although he acknowledges a certain resemblance to the failed “Tarea Ordenamiento” of 2021, Vidal emphasizes that this time the currency adjustment should be accompanied by a genuine economic liberalization that allows the private sector, agriculture, and other productive actors to respond to the new market incentives.
The second priority transformation would be the reassignment of resources and employment, which would involve closing, merging, or restructuring unprofitable state-owned enterprises, mitigating the impact through the expansion of the private sector and temporary subsidies for affected workers.
The economist warns that "the sequence of changes cannot be excessively slow, as has been the case, nor should it lead to a disorganized and chaotic process of liberalization and privatization that ultimately exacerbates productive contraction and social costs, and creates opportunities for rent-seeking by elites."
Vidal also points out that the real inflation —estimated at around 70% year-on-year— has moderated "more due to a adjustment for impoverishment than to the implementation of a consistent stabilization program," which exacerbates the urgency for reforms.
The analysis takes place at a time when the Trump administration has imposed over 240 new sanctions against Cuba since January 2026, while the conversations between both governments were confirmed to be in a "very preliminary and initial" phase by Cuban Deputy Foreign Minister Josefina Vidal in April.
"The speed and extent to which this may happen will, however, be the result of the balance of power that emerges in the political negotiation and the type of agreements reached with the United States," concludes Vidal about the future of GAESA.
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