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What's coming next for Cuba? Capture and killed still an option? I just can't tell you that we've got options all over the map. Perhaps no other nation epitomizes Cold War politics more than Cuba. When you look for a country that's, let's say, punched above its weight on a global stage, Cuba should be on the list. Cuba and the United States by default of their geography have always had some kind of economic relationship. When we had prohibition in the United States, Cuba became a haven for American tourists.
Cuba is just 90 miles south of Florida. It's in the heart of the Caribbean. It's been seen as kind of a strategic platform for US rivals. The US has had a broad trade embargo on Cuba since shortly after the revolution in the 1960s. Cuba is ruled by a single party, the Cuban Communist Party, and it controls the legislature, controls the military, controls all facets of society. But the socialist idealism that birthed Cuba has ground to a halt, literally running out of gas. There is a dire jet fuel shortage in Cuba as the US is moving to cut off the country's oil supply.
Crippling blackouts and a teetering economy have sparked to unrest on the island. We have an unprecedented degree of suffering on the island. The Trump administration has taken a hard line. Cuba has always posed a national security threat. Tonight, the Justice Department unsealing an indictment against former Cuban President Raul Castro. Will Castro actually face this prosecution? The message the indictment sends to the Cuban government is that the US is serious.
Amid the upheaval, many are looking for change and some see opportunity. Two million plus Cubans that leave abroad. They have a genuine desire to see their country prosper and the people prosper and move forward into a different direction. Uncertainty and crisis are no strangers to Cuba. Cuba was, you know, reeling in the early '90s from the collapse of the USSR. So they lost a massive benefactor. Then in the early 2000s, Fidel Castro started one of Latin America's most important political
and economic alliances with Hugo Chavez of Venezuela. Chavez vowed to support Cuba to help provide them with what they needed, which in essence was a steady supply, oil and refined products. Oil powers Cuba's electrical grid. The imported supply has steadily fallen. Even when you add in the roughly 40,000 barrels of domestic production a day, it's well short of what's needed to function normally. The US swooping in and snatching Maduro and his wife out of bed was a complete game changer for Cuba. With Venezuelan oil gone, Cuba quickly became more vulnerable. In the past, Russia has supplied some oil and Mexico also.
But in late January, Trump threatened sanctions on any nation that supplied Cuba with oil. And President Claudia Sheinbaum of Mexico decided that was too great a risk to her own economy. International voices are calling Trump's crackdown inhumane and illegal. The humanitarian consequences as you might expect continue to, to deepen.
It is in particular impacting Cuba's health sector, which was long a point of pride. The surgery wait list has grown. Infant mortality is rising. Attempts to bring in humanitarian aid and food from places like Mexico is very slow. And when you have no gasoline to distribute those things on the island, it's also difficult to get those things into the hands of the people that need them. Really, it's the Cuban government that ends up with the fuel, with the goods.
Famous ration card that the, the Cuban government always guaranteed people an allotted amount of rice or chicken or eggs. That's all breaking down. And now what people are saying on the island is these products are available. They just simply can't afford them anymore. Juan Carlos Blain runs a restaurant and grocery that is struggling through the shortages.
Inflation in Cuba has been running very, very high. It kind of peaked during the pandemic at about 71%. It's at 14% in 2025 and those are the official figures. But economists estimate it's really up here at nearly pandemic levels. Airlines have had to cancel their flights because there's no jet fuel available on the island, so that's of course hurt the tourism industry. Tourism is a key pillar of the economy. In 2016, President Barack Obama visited the island as part of an attempt to normalize relations.
Look how visitors climbed, peaking just after that trip. Then the pandemic hit. Cuba never fully recovered with last year's arrivals the lowest outside the Covid years in two decades. Hotels have closed and credit card transactions have been suspended. The Cuban government has remained reliant on Soviet era programs. The biggest single source of foreign currency for the, for the island right now is its doctors, its medical brigades. At times, there's been more than 24,000 doctors working these brigades abroad and they, they bring in more than $4 billion to the economy.
Venezuela sent subsidized oil to Cuba in exchange for Cuban medical workers. Cuba has made economic reforms in fits and starts when it had to, but it is the only remaining communist country that it hasn't attempted any type of substantial market reform. Pivoting to state-run capitalism may be the obvious move for leadership in Cuba. But in the near term, the private sector may offer its best hope at recovery. The Cubans have having this incredible ability to adapt. You start to read about the business literature in Cuba and it's always talks about how resilient they are. And that's what we're seeing now.
The Cuban government says there are now more than 9,200 small and medium businesses. The private sector shown here in Gray is also employing a growing share of the workforce. Cuba's leadership is not blind to the situation. The Cuban government approving more than 170 sweeping economic reforms opening the door to private investment. Cuba is opening itself up to foreign investment. It is allowing its private sector to grow, but it is still a communist system.
Doing business in Cuba involves doing business with the state. The government has also said that Cubans living abroad should be allowed to invest in small business and own small businesses on the island. But again, there's so many caveats there. You would be a fool to invest in Cuba under these circumstances, precisely because the Cuban government provides no guarantees for either the investment that you might make or property ownership or just the rights of private entrepreneurs to control the nature of their investment or the profits that might accrue. Hold that thought until after this. I feel like a pawn and a big game of chess.
Uncover more at bloomberg.com/videos. Cuba's expat community is helping to fill the void. Hugo Cancio runs Katapulk, an online marketplace that allows the Cuban diaspora to buy anything from groceries to mobile minutes for their relatives. We have over 33,000 products. We do about 1,500 to 2,000 orders a day. We have a huge logistic on the ground. There is an exception to commerce department's export controls on Cuba.
This allows companies like Hugo Cancio's to import food, to import consumer goods without running afoul of US sanctions. Cancio's company is even shipping containers of natural gas to the island. But the quantities needed to recharge the country's energy grid will have to come from big suppliers. Big money is going take a while to come. You need to change the rules of engagement. You need to have a legal system that protects investment.
There's wealth being created in Cuba. I think the private sector of the champions right now, they're the one moving forward whatever little economy there is left. Meanwhile, American internal politics are also driving much change in Cuba. You can't tell the Cuban political story without telling the South Florida story. Marco Rubio is born to Cuban parents in Florida. He's definitely part of this kind of Cuban hard line, this Cuban political force that wants to see change in Cuba. And it's important for US politics.
I really don't believe this system is capable of reform unless new people take over. Somebody like Rubio, who probably has presidential aspirations, if he could give this to that community, if he could be the one to usher in regime change, it would probably vault him to the very front of the field in a future Republican primary. I think he'd like to be the liberator, quote unquote, of Cuba. And I think that the Republican Party in general owes much of its electoral success, at least since the year 2000, to the state of Florida and largely to South Florida voters who are Cuban exiles.
I'm gona take good care of them. I'm gonna let them go back to their land. I personally, and a lot of Cubans don't want this direct military confrontation with the United States. That'll be really sad. Somewhere in Cuba, there is someone mother's, someone's father. There's my young nephew who is 19 years old. He's in the Cuban military.
I hope and will do everything within my powers to where, you know, my adoptive country and my native country comes to term and negotiated into this humanitarian crisis that is happening on the island right now.
