International Tourism: The New Engine of Cuba’s Economy

Cuba’s budding tourism industry, built during the 1990’s, has replaced sugar as the island’s top foreign exchange earner. In contrast to sugar, tourism is based on sound competitive advantages, and it has the potential to generate additional growth, income, and employment in the decades ahead.

The sector is still relatively small – it employs 100,000 workers directly, about the same number laid off from sugar industry jobs this year alone. But its significance is large. Tourism development is national in scope. It draws foreign investment and know-how. It forces officials and state enterprise executives to cope with international market realities, and it is bringing managers and workers to learn the art of customer service.

Tourism also benefits other parts of the Cuban economy, creating demand for goods and services provided by state enterprises and, in spite of the economy’s clear socialist orientation, by Cuba’s small private sector as well.

This paper examines the growth and composition of Cuba’s tourism industry and its impact on the Cuban economy and workers, and considers the industry’s competitive future in the international tourism market. It is based on field research conducted in Cuba, including visits to tourism businesses and interviews with officials, executives, workers, and tourists themselves.

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