Cuba’s already cash-strapped economy shrank 11% in 2020 due to the pandemic, tougher U.S. sanctions and domestic inefficiencies, Economy Minister Alejandro Gil said on Thursday, forecasting 6% to 7% growth for next year, Reuters reported. Addressing a year-end session of the Communist-run country’s parliament, Gil said it would take the next two years for the state-run economy to recover from this year’s sharp contraction.
Wealthy nations grouped together in the Paris Club of creditors have waived Cuba’s annual payment for restructured debt but plan to impose a penalty on the Communist–run island, according to five Western diplomats with knowledge of the situation, Reuters reported. This year marks the first time Cuba has missed the entire payment due by Oct. 31 since the restructuring agreement was signed in 2015, though it fell short of full payment last year as well. The accord, signed in tandem with the U.S.
Investment firm CRF I Ltd. sued Cuba in a London court in an attempt to force the island’s communist government to repay commercial debt that it defaulted on more than three decades ago, Bloomberg News reported. CRF, which has held Cuban debt for more than a decade, said the claim was filed in U.K. High Court against the government and state-owned Banco Nacional de Cuba. It stems from credits two European banks extended to the Cuban bank in 1982 and 1984, according to a copy of the claim seen by Bloomberg.
Cash-strapped Cuba has begun paying a fourth installment on its renegotiated $2.6 billion debt to 14 creditor nations, and its chief debt negotiator, Ricardo Cabrisas, told Reuters this week that all payments would be made, even if a bit late, Reuters reported. Communist-run Cuba reached an agreement in 2015 with members of the Paris Club of wealthy creditor nations that forgave $8.5 billion of the $11.1 billion in debt it defaulted on through 1986, as well as charges.