Cuba grid collapse accelerates exodus of foreign firms

Cuba’s national electricity grid collapsed for the third time in ten days on Tuesday. The failure left the 9.5 million residents of the 777-mile island sweltering without power.

The immediate cause is a six-month US oil blockade, but the underlying failure is decades of neglected infrastructure. As Jorge Piñon, a senior energy researcher at the University of Texas, noted, the system relies on big power plants that are "old, broken and tired." For international markets, this signals a total operational freeze.

Foreign businesses are rapidly liquidating their exposure. Canadian nickel miner Sherritt is planning to offload its interests to Ray Washburne, a former advisor to Trump, rather than face US sanctions. Supply chains have completely seized up; one electric car importer reported having seven containers stuck in Kingston and 40 in China, with no certainty they will ever arrive.

The energy minister, Vicente de la O Levy, admitted the state has no access to fuel or spare parts for its thermoelectric units. This physical inability to generate power has stalled whatever economic activity survived the pandemic-era hyperinflation.

The blackout crisis is accelerating a broader breakdown in social order that makes commerce impossible. Historically one of Latin America's safest nations, Cuba now faces rising street violence, muggings and burglaries. Police response times have stretched to hours, leaving foreign staff and local assets unprotected.

Any hopes that Havana's recent announcement of 176 unenacted measures to expand the private sector might attract fresh capital were swiftly dismissed by the US State Department as "superficial smoke signals." With Trump openly boasting that he can do "anything I want with it," the regulatory and geopolitical trajectory points to further isolation.

The grid was temporarily reconnected at 7am on Wednesday, but the respite is expected to be brief. For any remaining foreign investors, the combination of physical infrastructure collapse, spiraling crime, and maximalist US sanctions has turned Cuba into an unmitigated liability.