Cuba economy expanding fast in 2015 while foreign investment surges

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Cuba, a self-proclaimed socialist nation of 11 million that for over half a century has suffered a costly economic blockade, will in spite of this expand at a fast rate in 2015 and see an investment surge, according to the United Nation´s Economic Commission for Latin America and the Caribbean. 

Cuba will expand this year at a rate that will be eight times faster than a 0.5 percent average expansion for all Latin America and the Caribbean, on average, said Alicia Barcena, the organization´s executive secretary, during a press conference on Wednesday in Chile to discuss the region´s economy. 

¨We project Cuba will expand this year at a 4 percent rate and that it will have an increase in investments of 20 percent, especially direct foreign investment,¨ she said. 

¨We believe that there will be 11 sectors a lot more active in the Cuban economy where there will be foreign investment like agriculture, biochemistry, renewable energies as well as construction. There have been important legislative changes, especially in foreign investment and labor laws, that will surely bring important incentives to investors,¨ Barcena added. 

The U.S.-led economic embargo ¨continues to be a formidable barrier even as there has been some opening in areas like tourism and commerce, but the truth is that the blockade continues to increase financial costs for Cuba´s development,¨ she said. The cost of the blockade to Cuba up to 2014 has been estimated at $117 billion, she said. 

According to a report published in mid-July in the Cuban official newspaper Granma, the President of the State Council and of Ministers, General Raul Castro, said this month in the country legislature that ¨despite a difficult financial situation in the external environment, which has characterized 2015 so far, Cuba has been able to revert the trend of a slowing down of the gross domestic product of recent years.¨ 

According to Castro, the Cuban economy expanded 4.7 percent in the first half of 2015. The economy had expanded 1 percent in 2014, he added. 

¨We have managed this without getting rid of social services to the population, which we will never neglect, and the epidemiology situation has significantly improved,¨ Castro was quoted as saying. 

¨When he referred to the main aspects of the updating of the economic model, he underlined that there is currently in the making a theoretical conceptualization of the Cuban Socialism, which had not been done before, for the lines and strategic sectors that will make up the program of economic and social development up to the year 2030,¨ the official newspaper reported. 

In December 2014 U.S. President Barack Obama announced the intention to begin normalizing relationships with Cuba. Castro urged him at the time to end the economic embargo, according to press reports at the time.