Miguel Díaz-Canel admitted at the closing of the Extraordinary Plenary of the Central Committee of the Communist Party of Cuba that the price caps imposed by his government not only failed to curb inflation but also produced results opposite to those intended, and announced that Cuba will abandon this policy of generalized price control.
The leader acknowledged in his speech before the Extraordinary Plenary of the PCC that the measure resulted in consequences that the regime itself had denied or downplayed for years.
"Price controls have, in practice, failed to contain inflation. They often led to product shortages, shifts towards illegal markets, higher prices, decreased tax revenues, and an impossible race between real prices and administrative decisions that always arrived late or remained fixed in ignorance of the changing economic reality," stated Díaz-Canel.
Self-criticism carries considerable political weight: the government had defended and implemented these controls in recent years, including Resolution 225/2024, which in July 2024 set maximum prices for six basic products — diced chicken, cooking oil, powdered milk, pasta, sausages, and powder detergent — a measure that the government even suspended before it took effect while negotiating with private actors.
At that moment, the Food Monitor Program warned that price caps could increase shortages and expand the black market, and economist Pedro Monreal pointed out that such controls often result in repressed inflation and shortages. Two years later, Díaz-Canel confirmed that diagnosis from the official podium.
"That's why we will not continue to set prices in general, as the Prime Minister explained," the president stated, referring to Manuel Marrero Cruz, who presented the package of over 20 economic transformations approved at the Plenary.
As an alternative, the regime announced a tax reform to eliminate the distortions that inflate production chains. "We will move towards a value-added tax (VAT) that is creditable and progressively supported by electronic invoicing to avoid cascading taxation," Díaz-Canel stated.
The leader conditioned these measures on a parallel transformation of the social protection system, shifting from subsidizing products to directly subsidizing individuals. "But these decisions can only be implemented alongside a more direct and effective social protection system, transitioning from subsidizing products to subsidizing people, and with the effort to recover the purchasing power of salaries and pensions," he specified.
The economic context surrounding this acknowledgment is serious. Prices in Cuba continue to rise according to the official statistics themselves: in May 2026, the year-on-year inflation reached 15.89%, with food and non-alcoholic beverages increasing by 19.24%.
The dollar in the informal market reached 600 Cuban pesos in early June, a new historic high.
The National Assembly has been summoned to an extraordinary session for this Thursday to ratify the reforms approved by the PCC, including the abandonment of generalized price caps.
"It is not about leaving anyone alone in front of the market; it is about better protection, increased production, intelligent regulation, and realistic organization," concluded Díaz-Canel regarding the new approach that, according to the regime, will guide price policy in Cuba.
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