Cuba’s economy considered as a planned economy which is an economic system

where the production, investment, allocation of goods and others takes place according
to production plan and economic plans of the country.

In 1993, U.S dollars became legal in Cuba as a medium of exchange and allows Cuban
citizens to join and engage in several forms of self-employment. In the following years,
Cuba adopts a modern system of taxation and allows all sectors of its economy to
foreign and international investments except for national security, education, and public
health. The Cuban National Assembly permits foreign and international investors to
exclusively own business inside the country.

In 1999, the GDP growth increased to 6.2 percent due to continued growth of country’s
tourism. In 2005, the country’s GDP growth suprisingly increased to 11.8 percent
according to government figures. Due to the continued growth of the Cuban economy, it
grew by 7.5 percent which is advanced than the Latin American average.

In 2008, the president of Cuba legalized the Cubans to work for foreign companies.
During this year, purchasing technologies such as computers, microwaves, and DVD
player became legal. In 2011, the New Cuban Economy was introduced. It is a new and
modern economic reforms the would effectively create a innovative economic system.

In 2011, policy for a new credit permitted Cuban banks to finance businessmen and
entrepreneurs. This is to make major purchases to do home developments in addition to
Cuban farmers. During 2013, dual-currency system was set by Raul Castro and as of
2018 it is still being used in the country.

The accomplishment of the communist party’s policy in Cuba were enabling social
advancement for the underprivileged classes such as working class and peasants. But
this achievement was curbed by the economic crisis happened to the country and the
low wages of workers for the past decades. The Communist Party is unwilling to talk
about this dilemma because it would touch a main characteristic of its revolutionary
legitimacy. Due to this crisis, data on the growing socio-economic divide was published
by National Bureau of Statistics of Cuba. A countrywide scientific survey presents the
social inequalities became progressively visible in a daily life of Cuban population.
But in 2014, economy of Cuba has seen a small increase in foreign and international
investments. Four years after, the government of Cuba continued to make efforts to
invite and attract international and foreign investors. By that, from 246 projects in 2014,
it increased to 525 Foreign Direct Investments projects in 2018.

The chart above shows the ups and downs of the GDP per capita growth of the
Republic of Cuba from 1993 to 2018. From -15.3% in 1993 the GDP per capita growth
of Cuba increased to 2.3 in 2018.

The economy of Cuba is increasing due to its new economic reforms from old economic
strategies of the socialist leadership. It is evident that the Gross Domestic Products per
capita growth was recover from the last 25 years GDP per capita growth negative
percentage.