The Cuban government can no longer afford its massive subsidy campaign for nearly all essential goods. The government of Cuba has announced a 500% increase in fuel prices beginning on February 1, as the nation suffers its worst economic crisis since the 1990s, with Cubans now readying themselves to weather what is being called a humanitarian crisis.
“The country can not maintain the price of fuel, which is the cheapest in the world,” media cited Economy Minister Alejandro Gil as saying on Monday.
Officials confirmed on Monday that the cost of one liter of regular gasoline would increase from the current 20 cents to $1.10, while special gasoline would increase from around 25 cents to $1.30.
Additionally, there will also be a 25% increase in electricity prices along with a hike in natural gas prices. Prices for water, public transit and gas canisters will be increased.
Cuba’s GDP contracted by between 1% and 2% last year, and the country is having difficulty importing basic goods with a fiscal deficit around 19% and official inflation pegged at 30%.
With price spikes set to go into effect in two-and-a-half weeks, Reuters reports that Cubans are lining up at gas stations for extra fuel at lower subsidized prices.
For Cubans, 2023 was characterized by major power blackouts and long lines to purchase fuel, with February 1 expected to add another jolt to struggling consumers.
Looks like government running the entire economy has, yet again, proven not to work out very well for the average working citizen and taxpayer. Will the free market ever be given a chance to develop naturally without unnecessary governmental intervention and govt-subsidized monopoly anytime soon? Don't hold your breath. This is what plebs vote for, this is what they continue to get.
