Cuba
Table of Contents
Cuba, officially the Republic of Cuba, is an island country in the Caribbean. The nation of Cuba comprises the main island of Cuba, the Isla de la Juventud, and several archipelagos. Havana is the capital of Cuba and its largest city. The second largest city is Santiago de Cuba. To the north of Cuba lies the United States 93 miles away and the Bahamas are to the northeast, Mexico is to the west at 120 miles away, the Cayman Islands and Jamaica are to the south, and Haitiand the Dominican Republic are to the southeast. Cuba is the second largest mineral resource of nickel, after Russia. Cuba is also the world’s fifth largest producer of refined cobalt. Oil exploration has been able to locate oil beds, which are estimated to produce 4.65 billion to 9.3 billion barrels.
Cuba Country Information (Source: OECD) | |
---|---|
Population | 11.27 million (2012) |
GDP | $68.23 billion (2012) |
Improved Water Sources | 86.1% |
Life Expectancy | 79 |
Income Level | Upper Middle |
1 . PEST Analysis of Cuba
Political environment
Cuba is one of the largest islands in the Caribbean which was once inhabited by tribal people when Christopher Columbus visited the island during his first voyage. He discovered it and declared it as a territory of Spain 1762 this country was briefly held by Britain before being returned in exchange for Florida. A series of rebellions occurred during the 19th century which failed to end Spanish rule, but increased tensions between Spain and the United States, resulted in the Spanish-American War, finally led to Spanish withdrawal, and in 1902, Cuba gained formal independence. American trade dominated Cuba during the first half of the 20th century. It was helped by US government policy measures assuring influence over the island. In 1959, Dictator Fulgencio Batista was overthrown in a revolution led by Fidel Castro. Cuba-United States relations froze while the island showed its faith towards the Soviet Union, which kept its economy running in spite of being US against Cuba. After the dissolution of the east-west-confrontation Cuba remains as one of the only Communist countries in the world. Cuba is a communist state. The departments of the state and the Cuban Communist Party are closely connected and their power is mainly devolved from the Executive Committee of the Council of Ministers. Their National Assembly which has legislative e powers consists of 614 members. Their next elections for the provinces and nation are due in January 2012, the municipal elections in April 2010, even though there is only one legal party which is namely the Cuban Communist Party (PCC). The head of state and government of Cuba is Raúl Castro Ruz.
Economical Environment
The consumer prices, or inflation rate, rose by 3,4 % in 2008 which is, compared to other countries, an average figure, because they are number 47 on the world list. The Cuban labor force counts 4.962 million people of which 78% work in the state sector and 22% in the non-state sector. This figure scores them number 74 in comparison to the labor forces around the world. The unemployment rate is low compared to other countries as they only have 1,6 % jobless people and rank place 13 in the world. This rate even improved by 0,2 % from 2007 to 2008. The buying power, GDP per capita, of each Cuban was $9,500 in the year 2008. Compared to other countries they rank place 108 in the world's list, but seeing that the values improved over the years from 2006 until 2008 by $1,000 per-capita, their score is still positive. Cuba produces several agricultural products such as sugar, tobacco, citrus, coffee, rice,potatoes, beans and livestock. Main export goods are nickel, fish, citrus, coffee, tobacco products, sugar and its by-products and medicines. A 2008 estimate for their export of goods is $3.78 billion which makes them number 119 on the list of countries by exports. Their main export partners are China, Canada, Spain, the Netherlands and Iran. Goods that have to be imported are petroleum, food, machinery and equipment and chemicals. Their main import partners are Venezuela, China, Spain, Canada and the USA.
Social Environment
Cuba has a population of estimated 11,451,652 people. The population grows by 0.233 % each year. 18,3 % of these people are between 0 and 14 years, 70,4 % are between 15 and 64 years old and 11,2 % are 65 years or older. Therefore the average age is 37,3 years. 65,1 % are white, 24,8 % are mulatto and mestizo and 10,1 % are black (2002 census). The most dominant religions are Roman Catholics and Protestants. Nearly the whole population is able to read and write (99,8 %) at the age of 15 which enables them to pursue a good education. The majority (76 %) of the population preferably lives in urban areas. There are few factors and aspects that Cuba has been following, things such as Cuba imports 80% of its food, it has a strong biotechnology and pharmaceutical industry, the tourism industry is the main growth driver, wage and pension levels are very low in Cuba, the Cuban peso’s value is pegged to the US dollar, Cuba exports sugar, medical products, nickel, tobacco, shellfish, citrus and coffee, it imports petroleum, food, machinery and chemicals.
It buys oil from Venezuela on preferential terms and sends its doctors as aids in return. Cuba’s economy is largely state controlled and the current government of Cuba is trying hard to maintain a balance between preserving firm political control and reviving the economy. The standard of living of the Cuban people is far below the levels witnessed before the economic downturn of the 1990’s, which was triggered by the withdrawal of soviet subsidies. The country’s government undertook certain economic reforms in 1993 and 1994 to alleviate the country’s economic problems, including the shortage of food and consumer goods. Some of the prominent reforms included the opening up of the country’s tourism segment, allowing foreign investment, authorizing self employment in some areas and legalizing the holding of the US dollars. Raúl Castro's administration has launched an electricity revolution, aimed at removing the country’s electricity problems.
Technological Environment
Cuba is a recognized leading country in the field of biotechnology, but there are still sectors that lack development. Internet access is for example only provided by one provider at high costs which shows an inadequate telecommunications infrastructure. The information technology system in Cuba still has to be improved, because the profitable sectors such as tourism and biotechnology require good and continuously updated communication structures and instruments which are not sufficient at the moment. Castro sees that modern communication and computer networks are necessary for the economy and is willing to open new doors in order to make this possible. As a result of its universal health care system, its life expectancy at birth is 78 years. Historically, Cuba has ranked high in numbers of medical personnel and has made significant contributions to world health since the 19th century. Today, Cuba has universal health care and although shortages of medical supplies persist, there is no shortage of medical personnel, which is one of the biggest feats achieved in the nation's history and current conditions of importing most of their pharmaceutical needs.
2 . Future Trends in Cuba
Foreign investment, specifically through tourism, offers a great opportunity for Cuba to attain capital which can help to breathe life into its struggling economy. At the same time, a harsh US trade embargo greatly hampers the Cuban economy, and keeps it in a perpetual state of need. In order to improve economic conditions in Cuba, it is necessary to implement a degree of capitalist reforms, specifically in reference to wage and price controls, to encourage productivity and decrease black market activity. Even more beneficial would be the improvement of relations with the United States and the possible cessation of the current embargo. Cuba finds itself occupying a unique position, as the sworn adversary to US policy and the capitalist way of life, despite being located only 90 miles south of Florida. This position is made even more unique by the close historical ties that Cuba and the United States share. As Cuba faces the new century with aging leaders from a fading Revolution, the hope for economic progress in Cuba lies in reestablishing ties with the giant to the north that has influenced their history so much already.