The announcement at the end of 2007 that Fidel Castro might not seek to continue as president of Cuba was heralded as the mark of a new era in the island’s evolution. This was understandable given Fidel’s iconic status in Cuban politics, but it missed the point. Since August 2006, when he “temporarily” relinquished the presidency, Fidel Castro has ceased to be involved in the daily minutiae of Cuban politics. His health, although improving, will not allow him to return to his previous life, and he will continue to concentrate on what he has been doing for the last 16 months: writing on issues of international importance, such as the use of bio-fuels in the alternative energy mix, and meeting the occasional foreign visitor. Fidel is still and will remain a formidable presence on the Cuban stage, but he is no longer the towering figure of the past. Cubans have started their transition to a post-Fidel world, which increasingly emphasizes economic reform to ensure the regime’s survival.

The handover to a new leadership in 2006 was a complicated affair. Thousands of pages of documents had to be prepared before the transfer of power could be effected, including control over secret foreign bank accounts and other highly sensitive material. Fidel Castro, both by virtue of longevity and due to his personal character, had accumulated extra-ordinary powers at the apex of the Cuban state. In 1959, the first year of the Cuban Revolution, Fidel was neither Head of State nor in charge of the Communist Party. The process of accumulating power was a lengthy one and not without its dramas. Redistributing these powers tested the Cuban political system to the limit.

What has emerged is closer to a collective leadership with Raúl Castro, Fidel’s younger brother by five years, as primus inter pares. Yet other members of this elite are vital in understanding the transition that has taken place in Cuba since August 2006. Raúl’s pre-eminence is due not only to his relationship with Fidel but also to his command of the armed forces and his long association with the Communist Party. Vice-President Carlos Lage, responsible for energy, brings a hint of reform and modernization with an emphasis on greater efficiency. Foreign Minister Felipe Pérez Roque, closely allied with Fidel from his earliest years in politics, represents the first of the younger generation to break the grip on power of its elders. Central Bank Governor Francisco Soberón represents the technocracy whose input will be crucial if the Cuban system is to survive.

This collective leadership has its own dynamic. In its first months, when it was not clear if Fidel would recover from his illness, there was a suggestion of significant economic reform, leading to the relative isolation of Pérez Roque, often described as one of the Talibans within the government and a hardliner on most reform issues. That gave way to a more modest approach as Fidel’s health improved. The election of a new Cuban President, almost certainly Raúl Castro, at the end of February from among the members of the National Assembly will change the dynamic again. Whoever is elected, however, will resist the temptation to accumulate power the way Fidel did. Fidel’s style is recognized in Cuba, at least sotto voce, as being incompatible with the efficient government of an increasingly complex society.

International Context

The international political environment in which the new collective leadership has exercised authority has been benign. The US administration has been distracted by the war on terror and its attempt to include Cuba in the “axis of evil” was half-hearted and unconvincing. The European Union has failed to deliver on its threat to disengage if progress was not made on human rights and has gone back to a model of “business as usual” in which the common policy has become fragmented. The left in Latin America has advanced in the last few years and has deepened its links with the island while the Caribbean is keener than ever to have good relations with Cuba rather than run the risk of aggressive competition in activities on which the Caribbean depends.

The international economic environment has been even more favorable. The global rise in commodity prices has served Cuba well for its leading primary product exports such as nickel and sugar. Chinese investment in the extractive industries, as in so many other countries, is important and cheap credits from China have allowed Cuba to replace and upgrade its rundown capital stock in many areas, most visibly in public transport. Remittances, despite the additional restrictions imposed by the Bush administration, have not fallen. Economic links with Venezuela through ALBA (the Bolivarian Alternative for the People of Our America, President Chávez’s alternative to the proposed Free Trade of the Americas) have been wide and deep.

The Venezuelan Link

The most important part of the Venezuelan relationship for Cuba has not surprisingly involved oil. Despite recent oil discoveries and energy conservation measures, Cuba is still a net importer, now producing almost half of its consumption. The rise in the price of oil would, therefore, have hit Cuba hard were it not for the agreement with Venezuela. Although the details have never been published, the agreement appears to work as follows: Cuba imports nearly 100,000 barrels per day (at US$100 per barrel, this is equivalent to roughly US$3.5 billion per year). Like other oil importers under PetroCaribe, the oil scheme established by Chávez in 2005, Cuba receives long term credits to cover about 40 percent of the cost. Unlike other members of PetroCaribe, Cuba does not have to pay cash for the remaining 60 percent (approximately US$2 billion). Instead, Cuba provides services to Venezuela in the form of 15,000 to 20,000 professionals, mostly in public health. These specialists, who volunteer for the work but remain employees of the Cuban state, continue to receive their Cuban salary payable in national pesos to a bank in Cuba, but also receive a small income in foreign currency while in Venezuela, where they are provided with food and shelter. On their return to Cuba, they can convert their accumulated salary into hard currency and are rumored to receive preferential treatment in access to durable goods such as cars.