Cuba's Economy Is One Step Away From Collapse

The U.S. has struck a major "metal" blow.

Cuba's economy is one step away from collapse due to the decision to pull out of Canada's Sherritt International Corp. The mining giant is shutting down its nickel operations under heavy pressure from Washington.

According to Bloomberg.

Sherritt's exit closes off access to hard cash the country has been receiving from metal exports. Sherritt is not just about mining, as the company owns a one-third stake in Energas SA. That joint venture produces electricity, oil and gas on the island.

Omar Everleny Perez, former director of the Center for Cuban Economic Studies, calls the decision a devastating blow.

Here's why Canadian cooperation with Energas is critical to Cuba:

providing about 10 percent of the nation's total capacity;

generating backup power to keep the grid stable;

supporting older thermal power plants after frequent accidents.

Without Canadian support, blackouts will become chronic. Perez notes that it is in the production of electricity that will cause the biggest problems. This could lead to a complete shutdown of industrial facilities in Havana and other cities.

The main "metal" strike

Nickel has always been the heart of Cuban exports as a source of hard currency for Havana. However, US sanctions have already managed to bleed the industry dry. Statistics show a precipitous drop in revenue.

While nickel generated $788 million for Cuba in 2021, revenue has collapsed to $88.6 million after Trump's pressure and sanctions.

Sherritt has operated in Cuba since the 1990s. The company ignored the U.S. embargo for decades. Its capitulation today is a significant concession to the power of U.S. sanctions, the piece noted.

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