Cuban retail sales fell sharply through March, state media said on Friday, reflecting short ages of basic goods and threatening the overall growth of the economy.
Internal Trade Minister Betsy Diaz Velazquez told a closed-door session of the National Assembly on Thursday that sales in the first quarter totalled 92.5% of the government’s target, short around 500 million pesos, which are officially equal to the dollar.
The government’s goal was only a few points above that of 2018. Diaz explained that food shortages in 2019, ranging from cooking oil and eggs to bread and chicken and which have sent residents scampering in search of basics, were largely due to fewer imports of spare parts, feed and food, the report said.
“These numbers reflect the reduction in the availability of several products, many of them in high demand, and this includes imported goods and others of domestic production that use imported raw materials,” said a local economist, who asked not to be identified due to restrictions on talking with foreign journalists.
Communist-run Cuba relies on imports directly or indirectly for much of what it consumes and the Caribbean island purchases those supplies with foreign currency it earns from exports, as the peso has no value outside its borders.
Foreign trade fell 25 percent from 2013 through 2017, with imports dropping to $11.3 billion from $15.6 billion, largely due to the crisis in Venezuela, from which Cuba receives oil and cash in exchange for health and other technical assistance.
Trade declined again last year, according to the government. More recently, the advent of a far-right government in Brazil led to the scrapping of a doctors-for-cash deal.
The tightening of United States (US) sanctions also has hurt tourism and other foreign exchange earnings.
The fall in revenue has led to cuts in fuel and energy consumption by state companies and service providers.
Communist Party leader Raul Castro on Wednesday warned that the economic situation could worsen in coming months.
Cuba forecast growth this year at 1.5 percent, slightly above its 2018 performance of 1.2 percent but local economists said that was now in doubt, in part because retail sales account for 20 percent of gross domestic product.
“Trade is a key component of GDP. Unfortunately, the only way to change the landscape is an increase in imports, given the restrictions on domestic supply, and that seems unlikely this.