Sherritt International's closure of its nickel refineries in Cuba has left the island's economy in shambles. The Canadian firm's departure was a result of Donald Trump's fuel blockade and additional sanctions. Havana's hotels are empty, food and medicine are scarce, and power outages are common.
American officials claim that their actions are temporary and aim to save Cuba's economy by removing the communist regime. If Trump succeeds, investors from the Cuban diaspora would rush to invest, transforming the island's economy.
However, Cuba's economic woes predate Trump's blockade and are rooted in decades of state control and regulation. The island's natural resources are modest, and its industries are underdeveloped or bloated.
Tourism is one area with potential for growth, as the infrastructure to handle a surge already exists. The regime has built several hotels and resorts, which could be used to attract visitors and create jobs.
Other industries, such as agriculture, would take longer to rescue, as they are dogged by inefficiencies and a lack of investment.
Liberalisation would bring both opportunities and challenges, including the destruction of Cuba's least competitive industries and the potential for an exodus of younger people.
Investors would face significant risks, including the possibility of the regime revoking licences or fiddling with property rights. A Trump-friendly leader could also fall out with the United States, risking new sanctions.
