Cuba reports wider 2015 trade deficit as commodity crash bites

Cuba's chronic goods trade deficit widened by $1.5 billion in 2015 as exports fell 24 percent and imports rose 3 percent, the government said, in the first data showing a commodity crash has hurt the economy. The information, released on the National Statistics Office web page did not cover Cuba's large service exports. Prices for key Cuban exports such as sugar, nickel and refined oil products all tumbled last year.
The Communist-run country began cutting back on its 2016 import orders last year and has been slow in making some payments to creditors and suppliers. Cuba orders much of its imports a year in advance. Cuban President Raul Castro told a year-end session of the National Assembly in December that economic growth would slow from 4 percent in 2015 to 2 percent in 2016 due to falling export revenues.
Cuba's trade deficit in goods has traditionally been compensated by the export of medical and other professionals, tourism and telecommunications, amounting to $12.7 billion in 2014, the latest figure available. The report said goods exports were valued at $3.9 billion, compared with $5.1 billion in 2014, and imports were $13.5 billion, compared with $13.1 billion the previous year. While no statistics are available, revenues from the sale of professional services to oil producing nations such as Venezuela and Angola, are also thought to have suffered.
Castro said in December that lower oil prices had reduced the cost of a number of imports such as food but also hurt "mutually advantageous cooperation relations with various (oil-producing) countries, in particular the Bolivarian Republic of Venezuela." The collapse of oil prices punishes Cuba under the terms of its oil deal with Venezuela. Cuba receives 90,000 barrels of oil per day as part of an exchange that sends Cuban professionals to Venezuela. Some 30,000 doctors and nurses, plus another 10,000 professionals, are posted in Venezuela. Cuba also receives cash for the workers. Economists and oil market experts believe the amount is tied to oil prices, meaning Venezuela would pay less to Cuba when prices are down. Cuba refines and resells some of the oil in a joint venture with its socialist ally. Prices for refined products were down in tandem with crude. The new trade date did not give a breakdown of the value of oil products or other exports.