Question

Cuba is a command economy that suffered a decline in economic growth because of a cut in the aid provided by the former Soviet Union when the latter collapsed. As a consequence, Cuba:

1) Experienced a rapid increase in economic growth
2) Transitioned to a market economy
3) Continued to receive aid from other countries
4) Faced economic challenges and had to adapt its economic policies

Answer 1

Cuba faced severe economic challenges following the loss of aid from the Soviet Union, leading to a need to adapt economic policies, including an increased focus on tourism and foreign investment, and gradual capitalist reforms in the post-Fidel era.

Step-by-step explanation:

When the Soviet Union collapsed in 1991, Cuba faced significant economic challenges due to the loss of Soviet aid. This support had been a lifeline for the island's command economy, which organized the production and distribution of resources by the state. Without this assistance, the Cuban economy experienced a period of severe downturn and economic stagnation. Fidel Castro, the Cuban leader, turned to tourism and foreign investment to help sustain the economy. However, the United States strengthened the trade embargo with the Helms-Burton Act in 1996, intensifying the island's economic difficulties. Despite these challenges, the Cuban government began implementing some capitalist reforms, such as allowing for an increase in private economic activity and slowly liberalizing certain sectors in an attempt to adapt to a new economic landscape.

In the post-Fidel era, Cuba has continued to transition from a socialist to a more capitalist economy, though this process has been gradual and careful to maintain the social services such as healthcare and education for which the Cuban state is known. While the Cuban people have experienced some improvements in areas like personal freedoms and economic opportunities, the economy still struggles, and the average standard of living remains low compared to global standards.