Introduction: Cuba Looks to the Future
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Introduction:
Cuba Looks to the Future

the dramatic announcement on december 17, 2014, by president Barack Obama and President Raúl Castro that the United States and Cuba would begin the process of normalizing relations took the world by surprise and garnered broad international support. Ending this last vestige of the Cold War in the Caribbean came as a relief to Latin America, which saw Washington's hostility as an anachronistic reminder of US interventionism stretching back more than a century. US allies in Europe, who had already begun to normalize their own relations with Cuba through the European Union, were happy to see Cuba removed as a source of tension in their relations with Washington. In both the United States and Cuba, ordinary citizens were overwhelmingly in favor of the new policy of engagement—including a majority of Cuban-Americans (Grenier and Gladstone 2016).

But while the unfolding bilateral rapprochement garnered international headlines, much less attention was paid to the momentous economic, social, and political changes underway within Cuba. Beginning in 2011, Raúl Castro's government embarked upon the most profound economic restructuring since the revolution in 1959. Dubbed the "updating" (actualización) of the economy, it involved nothing less than a transition from the hyper-centralized model of socialist planning that Cuba adopted from the Soviet Union in the 1970s, to a Cuban version of market socialism modeled roughly on the transitions experienced by Vietnam and China—socialism with Cuban characteristics. [End Page 235]

The eleven articles in this special issue explore in depth various aspects of Cuba's internal economic, social, and political evolution, as well as how those internal dynamics intersect with Cuba's place in the world. As a small island, Cuba must be integrated with the global economy and, therefore, it will always, to some degree, be at the mercy of broader international forces. In its quest for economic prosperity and security, Cuba has forged partnerships from Latin America to Europe and Asia. Normalization of relations with the United States, a natural commercial partner for an island just 90 miles away, was a logical extension of Raúl Castro's new economic policy.

UPDATING THE ECONOMY

The Cuban economy faced fundamental structural problems when Raúl Castro assumed the presidency in July 2006. Cuba had never fully recovered from the "Special Period"—the deep depression that followed the collapse of the Soviet Union and the consequent loss of $3 billion in annual aid. Although the economy grew gradually over the ensuing decade and a half, the gains were concentrated in tourism and medical services; the actual production of goods on the island had not regained 1989 levels. Hard currency earnings, even when supplemented by more than $2 billion in annual remittances, were hardly enough to cover essential imports of food and energy. State sector salaries did not provide an adequate standard of living, driving many Cubans into the informal economy, or to emigrate.

Raúl Castro wasted no time in unleashing a barrage of sharp, candid criticism of the economy, placing the blame for its failures squarely on Cuba's own policies rather than on the US embargo. The central problem, he said bluntly, was low productivity. In November 2010, Castro unveiled the blueprint for "updating" the Cuban economy—the Guidelines of the Social and Economic Policy of the Party and the Revolution—a revised version of which was approved in April 2011 by the Sixth Congress of the Communist Party of Cuba (Partido Comunista de Cuba 2011). [End Page 236]

Ricardo Torres provides an overview of the "updating" process mandated in 2011: the problems of the old economic model that led to the decision to renovate it; the basic contours of the renovation as prescribed; the progress made thus far; and the obstacles slowing or blocking further progress. The problems facing Cuban leaders are tough: implementation of reforms has been slow; rationalization of the state sector of the economy has "stumbled"; income inequality has grown, requiring remedial social policies; Cuba's exports lag, putting pressure on the capacity to import; efforts to attract foreign direct investment have fallen short; and the international economic and political environments have changed...