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November 25, 2024. Cuba’s tourism industry, known for years as the “locomotive of the economy”, is going through one of its worst crises in decades, according to the recent Dossier “GAESA also shuts down the tourism industry“ published by Cuba Siglo 21. The report reveals that, despite an investment of more than 24 billion dollars in the last 15 years, the sector has shown an alarming drop in key indicators.
Emilio Morales, author of the analysis, reports that between January and October 2024, tourist arrivals fell by 48.23% compared to the same period in 2019, before the pandemic. Only 1,718,636 visitors came to the country during these months, far short of the 3.5 million projected by the government for this year. In addition, hotel occupancy is at a worrisome 25%, and the sector’s revenues have dropped 61.82% in the last five years, from $3.185 billion in 2019 to just $1.216 billion in 2023.
The drop affects the main outbound markets across the board. For example, Canadian tourists, who represent 39.41% of the total, decreased by 19.15% compared to 2019. For their part, Cubans living abroad registered a 52.56% reduction, while travelers from the United States fell by 73.93%. Europe also showed a significant drop, with countries such as the United Kingdom, France and Italy leading the declines, exceeding 70% in some cases.
Causes of collapse
The report identifies several factors that explain this downturn:
- Control of GAESA: The monopoly of Grupo de Administración Empresarial S.A. (GAESA) over finances and economic decisions has prioritized tourism investments to the detriment of strategic sectors such as energy, transportation and agriculture.
- Multi-systemic crisis: Constant blackouts, urban deterioration, epidemics such as dengue fever and a growing crime rate have made the country an unattractive destination.
- Loss of human capital: Mass emigration has reduced the skilled labor force, affecting the quality of services.
- Failed foreign policies: Support for Russia in its invasion of Ukraine has alienated key European markets and its alliances with international terrorist actors keep it on that short list of countries associated with that scourge. On the other hand, the promotion of the recent mass exodus and the Cuban exile’s distrust of calls to invest in the island have limited the tourism potential of the diaspora, which has increasingly turned to the Dominican Republic as an alternative point for family reunions.
The future of Cuban tourism
The tourism slump poses serious economic challenges. To reverse the situation, it would be necessary to address structural problems such as the energy and water crisis, improve health security, attract foreign investment and boost the confidence of international markets.
Meanwhile, the rest of the Caribbean destinations continue to expand and attract tourists, leaving Cuba further and further behind. “The locomotive of the Cuban economy is derailed,” the report concludes.
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