Earth & Conservation

How Is Capitalism Changing Cuba?

While the U.S. and Cuba have a complicated history, they restored diplomatic relations in 2015. So how has life changed for Cubans since?

In 2015, President Obama restored diplomatic relations with Cuba, ushering in a new era for the small island country. Actually, Cuba has been slowly transitioning several years now - economically, anyway - moving away from communism for introducing capitalist elements.

Normalized relations with the U.S. are likely to accelerate that process, as Laura Ling reports in today's Seeker Daily dispatch.

Most industries in Cuba are owned by the state, but in 2010 the government began to allow limited self-employment and private sector jobs. Much of this work centers around the tourist industry, and it's estimated that about 200 discrete professions are now filling up with self-employed Cubans.

Ironically, many highly skilled professionals like doctors and engineers are taking these self-employed positions on the side. A taxi driver or a waiter can make more money than the state-issued salary provided by the government. Nearly 500,000 Cubans are officially registered as self-employed, but economists estimate the real number is closer to two million - around 40 percent of the workforce.

RELATED: The U.S. and Cuba's Complicated History Explained

Vacationers from all over the world fly to Cuba for its tropical climate and beaches. But for more than 50 years, travel restriction in the U.S. prohibited most Americans from visiting. In 2014, those restrictions were significantly eased and now an influx of American tourists is rapidly expanding the Cuban hospitality industry. You can even get Airbnb bookings in Havana now.

Despite the economic and diplomatic advances, many vestiges of communism remain. Political opposition is repressed, private ownership of land is still prohibited, and the government controls all imports and exports. This has created a unhealthy black market system that punishes restaurant and shop owners.

While travel ban has been lifted, the U.S. is still imposing its trade embargo on Cuba, which prohibits most American countries from doing business on the island. President Obama continues to advocate for a lifting of the ban, but Cold War habits die hard - the Republican-led Congress has consistently voted against it.

Laura has many more details in her report, including some updates on the wild world of Cuban internet access.

-- Glenn McDonald

Learn More:

The New York Times: U.S. Eases Restrictions on Travel to Cuba and Bank Transactions

Bloomberg: A Breakout Year for Cuban Entrepreneurs

Vox: Why Cuban Cap Drivers Earn More than Doctors