How Washington delivered the final blow to Cuba’s weakened tourism industry

The clock keeps ticking. The United States waits patiently after its latest checkmate against Cuba. The move has shaken a country that is already held together by pins, plunged into a severe crisis that has only worsened this year as economic strangulation by Washington intensifies. And all of this is unfolding in the shadow of a possible military intervention. Adding to this climate of extreme tension is an ultimatum: Friday, June 5, 2026. That is the date when a White House executive order of May 1 will take effect. The order threatens to freeze the assets on U.S. soil of any foreign companies or individuals that are still doing business with the Cuban regime.

Executive Order 14404 gives the United States a lot of leeway. It not only targets multinational corporations, it also openly challenges any person or entity that provides material or financial support to the island’s government. The threats also focus on those operating in the energy, defense, finance, mining and security sectors. The text’s ambiguity gives Washington total discretion to apply its sanctions.

For the Cuban economist Pavel Vidal, the net result of the new measures will be “an almost total disconnection of Cuba from international trade and financing circuits.” In other words, the final punch to an island that had already been in free fall for years. “Foreign companies that previously could assume certain risks may now prefer to withdraw to avoid problems with the United States. This affects what remained of imports, payments, insurance, maritime transportation and foreign investment. Practically the only things left are remittances, a few trips by Cuban-Americans, private-sector imports and humanitarian aid,” he said in a phone interview.

The first moves are already visible before the Friday deadline. As various experts pointed out shortly after the sanctions package became known, the latest U.S. turn of the screw targeted tourism and put Spanish firms between a rock and a hard place. The first step was taken by Iberostar, a major hotel chain that has been present on the island since 1993; on Tuesday, after several days of silence, the company confirmed that it will stop running 12 of its 18 hotels (those belonging to GAESA, the military conglomerate targeted by the U.S.).

It is not only a blow to the tourism industry, which is also the country’s main source of foreign currency. It also carries symbolic weight. One of the properties that will no longer operate under the Iberostar name is the Torre K, a controversial 42-story tower that was inaugurated in secrecy last year in an attempt by authorities to dampen social unrest over a monumental project amid a deep crisis.

And on Wednesday Meliá, the other major Spanish hotel company that could be subject to sanctions, announced it will stop operating 15 hotels in Cuba. Hours before Iberostar’s statement, the Canadian firm Blue Diamond, the third-largest by number of properties (15), also cut all ties with Havana. And in mid-May the Canadian mining company Sherritt announced it would also quit its businesses on the island, although days later it clarified it would only cease direct participation in its joint ventures.

These moves paint a bleak picture for a country that had already suffered a cumulative 15% decline in GDP since the Covid pandemic. Tourism had been in a prolonged slump even before the latest sanctions from the Trump administration. The sector ended 2025 with its worst visitor numbers (1.8 million) since 2002, excluding the years of the pandemic. Figures through May indicate that 2026 will be even worse. For that reason, island economist Mauricio de Miranda says the U.S. executive order merely accelerated a process that was bound to occur. “Undoubtedly, the U.S. measures have induced hotel chains to abandon the Cuban market, but not only because of the measures themselves, but because of the drop in tourist visits and the low occupancy levels of hotels. Cuba has ceased to be an attractive destination for tourism,” he told EL PAÍS.

All arrows point in the same direction: GAESA, the opaque military conglomerate with millions in foreign assets that controls almost half the Cuban economy and cannot be audited by the state. In an unusual statement, the Caribbean government on Tuesday defended the holding while unable to deny many of the criticisms it has accumulated over the years. According to the Cuban regime, the group’s purpose is “to bring together companies with capabilities to generate foreign currency and resources the State requires to maintain and develop social achievements.” On Tuesday, U.S. Secretary of State Marco Rubio, reiterated that the island “is controlled” by that military enterprise.

The new sanctions also shed light on Washington’s financial ambitions, which have hinted that a Venezuela-style deal would not be unwelcome to the Republican president, who as a businessman amassed millions in real estate. But De Miranda makes an important caveat. “For the Secretary of State [who is the son of immigrants from the island] and for Cuban-Americans, regime change is a priority.” The expert says that although there are clear signs of a possible economic deal with Havana, conditions do not exist for U.S. businesses to flourish because the country “is not currently an attractive place for investment.” It is the same tone Rubio used on Tuesday. “[Cuban people] need a systemic and serious reform.”

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