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Cuba after Fidel Castro

Last week I wrote about the developing scenario in the international economic environment following the election of Donald Trump as President of the United States. That developing scenario did not take into account the death of Cuban leader maximo Fidel Castro.

Castro had transferred his responsibilities to his brother in 2006 and as such has not effectively ruled over Cuba for the last 10 years, so his death may not mean much for the international economic environment. Even so, I believe that one really has to wait and see. What economic model will Cuba adopt after Castro? How will the US position itself in relation to Cuba? What will be the position of Russia and China?

One cannot ignore the fact that Castro was a Marxist/Leninist, who imposed a communist economic model on his country and suppressed fundamental freedoms. In fact, Cuba is probably one of the last countries (North Korea still hits the headlines, and possibly some other country) where private ownership of businesses is not allowed.

In my teen years, he was described by his critics as the opposite of what was seen to be right – and the Right. The fact that these two concepts are described using the same word, and were therefore wrongly given the same meaning, did not help.

The end result has been an impoverishment of the economy over a number of decades, which was further exacerbated by the demise of the Soviet Union and all the economic assistance that came with it. Thus one cannot ignore the negative impact that Castro had on his country’s economy and the standard of living of Cubans.

What happens in Cuba now that Castro has died will have an impact on the international economic environment

On the other hand, his political stance also influenced how the rest of the world looked at the US. He stood up to those American businesses which promoted economic imperialism, and succeeded.

The international economy would be very different from what it is today had certain US multinational companies not been stopped from wielding excessive power over the global economy. Castro was a key player in this opposition.

So how will the scenario continue to develop? Before Castro came to the scene in the 1950s, Cuba was very much under the economic influence of the US. With Castro now gone, will it be so again? If so, will US businesses seek to extend their influence all the way across Central and South America?

Russia and Cuba were not on excellent terms just before and after the Soviet Union imploded. The current Russian President Vladimir Putin sought to mend bridges. However, we have a different situation from that of the 1960s or even from that of the 2000s. With Trump’s election, we no longer have a situation where the US and Russia are at loggerheads. Will Russia allow US businesses a free hand in Cuba now?

The inherent economic weaknesses in those Latin American countries which do not look benignly at the US will mean that opposition to an attempt by US multinational companies to exercise their power in that part of the world will be very weak. If Russia were to allow US businesses a free hand in Cuba following Castro’s death, it would really be plain sailing for them.

Equally interesting has been the stance adopted by China. The Chinese government expressed a very positive opinion about Castro, after the announcement of his death. Will China seek to extend its economic influence in Central and South America through Cuba? So which sphere of economic influence will Cuba join – the Chinese or the US/Russian sphere of influence?

This is why I believe that what happens in Cuba now that Castro has died will have an impact on the international economic environment. It will also be important to note the stance to be taken by the European Union.

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