The Cuban economy is on track to close 2026 with a contraction of Gross Domestic Product (GDP) by 10.3%, the worst projection in all of Latin America and the Caribbean, and a drop comparable in magnitude to that recorded during the first year of the COVID-19 pandemic.
The new estimate appears in the Economic Study of Latin America and the Caribbean 2026 by the Economic Commission for Latin America and the Caribbean (Cepal), which projects a growth of 2.2% for the entire region this year.
The difference between Cuba and the rest of the declining economies is substantial. Haiti is projected to decline by 1.9% and Jamaica by 1.2%, while no other country included in the Cepal projections comes close to Cuba's downturn.
The forecast also indicates a significant deterioration compared to the estimates from just a few months ago. In April, ECLAC estimated that the Cuban GDP would fall by 6.5% in 2026.
The new forecast increases the contraction by 3.8 percentage points, reaching 10.3%.
The result would be nearly as severe as that of 2020, when the Cuban economy contracted by 10.9% amid the impact of the pandemic.
The Cuban economist Pedro Monreal believes that the Cepal's estimate could even be too low.
The expert noted that the latest official Cuban data on State Production of Goods and Services reflected a 13.4% decline in its value at current prices and stated that, given the significant weight of the state sector in the economy, this setback could indicate a contraction in GDP greater than that projected by the regional organization.
Monreal estimated that, using a relatively moderate GDP deflator range of between 15% and 20%, the real decline of the Cuban economy could be between 26.4% and 30.7%.
A brutal drop in just one year, the economist summarized.
On the other hand, the decline did not start in 2026 either. According to estimates from the United Nations agency, the Cuban GDP fell by 3.8% in 2025, after declining by 1.9% in 2023 and 1.1% in 2024, which means the island has experienced several consecutive years of contraction.
And the outlook does not indicate an immediate recovery either: CEPAL projects another decline of 5.1% for Cuba in 2027, once again the worst result anticipated among the economies of Latin America and the Caribbean.
In a specific report on the Cuban economy, Cepal identifies among the main factors for the downturn in 2026 the interruption of external oil supply, the collapse of international tourism, and the increasing financial and logistical isolation of the island.
Tourism, one of the main sources of foreign exchange for the country, is going through one of its worst moments.
Cuba received only 387,591 international visitors during the first half of 2026, a 60.7% decrease compared to the same period the previous year.
The Cepal also notes that the hotel occupancy rate fell to 12.9% during the first quarter, compared to the 23.7% recorded a year earlier, while the revenues of tourism entities decreased by 42.4%.
The tourism crisis is compounded by energy-related issues. The lack of fuel and the deterioration of the National Electroenergetic System have intensified blackouts and reduced the availability of electricity for industry, services, and other productive activities.
On the demand side, ECLAC anticipates a contraction in both private consumption and investment, accompanied by an increased scarcity of goods and fuels and a continued depreciation of the Cuban peso.
Inflation adds another pressure on a declining economy: the Consumer Price Index reached an annual variation of 20.70% in July, according to official figures from ONEI, while Cepal estimates that inflation could approach 27% by the end of 2026.
The deterioration can also be observed from a broader perspective.
An analysis published in the Cuba Economic Review by the Cuba Study Group estimates based on CEPAL series that the Cuban GDP is projected to have contracted by around 23% between 2018 and 2026, while Latin America and the Caribbean would have grown by approximately 14% during the same period.
The analysis attributes this divergence to a combination of external shocks and internal economic policy issues, including low productivity, strong dependence on the state, lack of predictability for the private sector, and investment decisions that favored hotel construction for years while the electrical infrastructure deteriorated.
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