President Raul Castro said Cuba is going through some adverse circumstances and but rejected any notion of an imminent economic collapse. The socialist leader addressed his country during a plenary session of the National Assembly in Havana. Castro gave a sober speech on 08 July 2016 about his country's economic challenges but insisted that measures were being taken to lesson the impact of a potential downturn on the Cuban people, who he said will continue to grow and develop under the Cuban model of socialism.
Raul Castro told Cubans to prepare for tough times ahead, as the Communist country must cut spending and energy supply as it delt with a cash crunch and reduced oil imports from ally Venezuela. Cuban economic growth slowed to 1 percent in the first half of this year from 4.7 percent in the same period of 2015, Castro told the mid-year session of the National Assembly. This was half of what the government had forecast.
Venezuela is Cuba's key ally and main trade partner, as a result, the current crisis in the South American country is having a negative spillover effect on the island's economy. However, the Cuban president ratified the solidarity and commitment of his country to the Bolivarian Revolution led by President Nicolas Maduro and the Venezuelan people.
The government was working to increase the purchasing power of the Cuban peso, such as lowering the prices of essential goods. The country has a complex system of parallel currencies—the peso for Cubans, a convertible peso for tourists, and multiple other exchange rates. This alone renders international comparisons about things like market size or production capacity difficult.
The impact of removing all barriers to US–Cuba travel is uncertain, but it is the focus of much interest in the region. Tourism is the main driver of growth and employment in many of the island countries in the Caribbean, where Cuba is a giant, not only in land size but as a tourist destination too. After Cancún in Mexico and the Dominican Republic, Cuba is the third largest destination for tourists in the Caribbean.