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Cuba Dispatch
8SEP

Havana makes the hiring middleman optional

4 min read
13:24UTC

Cuba's revised Decree 325 would let foreign firms hire Cubans directly, making optional the state agency that converts their wages into hard currency for the government. Washington spent the same five weeks designating the arms industry, the nickel monopoly and the traders who sell its output. An OCDH survey taken in between found 84 per cent of Cubans distrust the reforms.

Key takeaway

Washington and Havana are dismantling Cuba's foreign-wage intermediary from opposite ends in the same week.

This briefing mapped
Regulatory
Domestic
Humanitarian
Infrastructure
Economic
Legal
Diplomatic

OFAC designated Banco Exterior de Cuba and four fuel, mining and nickel traders on 3 September, plus one named individual, and issued General Licence 4A the same day.

Sources profile:This story draws on neutral-leaning sources

The US Treasury designated Cuba's state trade-finance bank, four fuel and mining traders, and Fidel Ernesto Castro Calis on 3 September. The same day it eased the embassy carve-out with General Licence 4A.

Washington is now naming trading intermediaries rather than the parents behind them, the same pattern Cuba has used for years to keep its main companies clean. 

Havana published a revised Decree 325 in the Gaceta Oficial on 4 September, permitting foreign-invested firms to hire Cubans without the state agency that has taken the hard currency since the 1990s.

Sources profile:This story draws on neutral-leaning sources

Cuba's government made it optional, not mandatory, for foreign firms to hire Cuban staff through the state employment agency. The change came via Decree-Law 128/2026 and Decree 325, published 3 and 4 September.

The agency still exists and still handles exit permits and currency conversion. This loosens one bottleneck for investors without loosening the state's grip on the workforce. 

OCDH's ninth study of social rights put extreme poverty at 94 per cent of Cubans and disapproval of the government at 95 per cent, three points above the same survey a year earlier.

Sources profile:This story draws on neutral-leaning sources

A survey from the Madrid-based Observatorio Cubano de Derechos Humanos, presented on 13 August, found 94 per cent of respondents in extreme poverty. Ninety-five per cent disapproved of the government.

Eighty-four per cent distrusted the economic measures Havana had announced by that date. That's before Decree 325 even existed, so the figure says nothing about the new hiring rules. 

OFAC blocked Cuba's Ministry of Construction on 20 August, the first Cuban ministry designated in its own right, alongside the state nickel-mining monopoly.

Sources profile:This story draws on neutral-leaning sources

The US Treasury blocked Cuba's Ministry of Construction outright on 20 August, the first ministry Washington has designated directly rather than a company beneath it.

Washington also designated Cuba's nickel-mining monopoly and two trading firms in the same action. Blocking the ministry itself marks a reach into everyday administration, not just state companies. 

A fault at the Felton thermal power station disconnected Cuba's eastern provinces on 27 August, taking three further plants down with it against a forecast 2,060 MW deficit.

Sources profile:This story draws on neutral-leaning sources

A fault at Cuba's Felton power station on 27 August disconnected provinces from Holguín to Guantánamo and knocked out units elsewhere. Cuba's state electricity company forecast a 2,060 MW deficit against 3,200 MW of demand.

That's an improvement on the 2,240 MW forecast in mid-July, but still enough to darken most of the island at peak. 

Sources:CiberCuba

Prisoners Defenders recorded 1,327 political prisoners at 31 July, up 21 net on June, after 36 additions against roughly 15 removals during the month.

Sources profile:This story draws on centre-leaning sources from United States
United States
LeftRight

Prisoners Defenders counted 1,327 political prisoners in Cuba at 31 July, up 21 net from June. Thirty-six names were added during the month against roughly 15 removed.

Additions are outpacing releases, which means the list keeps growing even in a month with no single mass-arrest event to point to. 

OFAC named five entities and six individuals on 6 August over military procurement for Cuba's armed forces, including the state trading houses Tecnotex and Technoimport.

Sources profile:This story draws on neutral-leaning sources

The US Treasury's sanctions office sanctioned five Cuban firms and six people on 6 August. Washington said they bought military equipment abroad for Cuba's defence ministry, through the holding firm Unión de Industria Militar.

It is the latest in a monthly run of Treasury actions that has made foreign banks warier of any Cuba-linked transaction, sanctioned or not. 

Cuba's statistics office recorded 419,000 visitors from January to July against 1.1 million a year earlier, as hotel chains suspended contracts and airlines dropped flights over refuelling.

Sources profile:This story draws on neutral-leaning sources

Cuba's national statistics office recorded 419,000 visitors from January to July 2026, down 62 per cent from 1.1 million a year earlier. The figures came via Associated Press after the office's website went down.

Airlines stopped flying once refuelling became unreliable, not because of a new rule, so the tourism collapse is now feeding on the fuel crisis directly. 

Presidential Determination 2026-21 continues Trading With the Enemy Act authority over Cuba to 14 September 2027, while OFAC's GECOMEX and GEMAR wind-down window closed on 12 August.

Sources profile:This story draws on neutral-leaning sources

A presidential order on 25 August renewed the legal basis for the whole US embargo on Cuba to September 2027. That's a routine step, not a new sanction.

More consequential: Cuba's state trading and shipping companies lost their wind-down licence on 12 August. Any further business with them now needs individual approval. 

OCDH counted at least 356 repressive actions in July, above the roughly 325 monthly average for the first half of the year, with police stake-outs outnumbering detentions two to one.

Sources profile:This story draws on neutral-leaning sources

The Observatorio Cubano de Derechos Humanos logged 356 repressive actions in Cuba during July, above the roughly 325 a month seen in the first half of 2026. That included 54 detentions and 109 stake-outs at activists' homes.

The stake-out figure points to pre-emptive surveillance, not just after-the-fact arrests, as the tool doing more of the work. 

Sources:14ymedio

The Dominican Republic ordered nine Cuban diplomats and their families out on 13 August without giving a reason. Havana put the number at ten.

Sources profile:This story draws on neutral-leaning sources

The Dominican Republic ordered nine Cuban diplomats and their families to leave on 13 August without stating a reason. Havana put the number at ten.

Cuba criticised President Luis Abinader over the move, but neither government has said what triggered it or whether more expulsions could follow. 

Dozens of residents, mostly mothers, protested outside the municipal government in Guanabacoa on 12 August after 30 to 50 hours without power.

Sources profile:This story draws on centre-leaning sources from United States
United States
LeftRight

Dozens of residents, mostly mothers, protested outside Guanabacoa's municipal government on 12 August after going 30 to 50 hours without electricity.

They chanted for power and complained about spoiled food and lost water, the same grid deficit covered above playing out street by street. 

Cuba's informal dollar rose from 673 to 683 pesos over the 30 days to 6 September while the euro fell from 783 to 775, a divergence El Toque's index shows but does not explain.

Sources profile:This story draws on neutral-leaning sources

Cuba's informal dollar rate rose from 673 to 683 pesos over the 30 days to 6 September, according to El Toque's index. The euro fell from 783 to 775 over the same period.

CiberCuba warned the split might reflect a methodology change at El Toque rather than a real shift in currency demand. 

Sources:14ymedio

Russia's embassy in Havana said on 31 August that expansion of full BRICS membership is not on the agenda, leaving Cuba a partner at the 12 September summit.

Sources profile:This story draws on neutral-leaning sources
Sources:14ymedio

Chinese foreign ministry spokesperson Guo Jiakun called China-Cuba cooperation open, transparent and legitimate on 11 August, and named no new assistance.

Sources profile:This story draws on neutral-leaning sources

China's foreign ministry spokesperson Guo Jiakun called China-Cuba cooperation open, transparent and legitimate on 11 August. That followed the US Treasury's 6 August designations, which reached Cuban military attachés posted to China and Russia.

He named no new aid, so the statement defends the relationship rather than offering Cuba anything Washington's pressure would actually change. 

Sources:14ymedio

Four officers detained Sady Reynaldo Companioni in Havana on 28 August, in front of her six-year-old daughter, after she posted complaints about the water supply.

Sources profile:This story draws on neutral-leaning sources

Four police officers detained Havana resident Sady Reynaldo Companioni on 28 August, in front of her six-year-old daughter. She had posted about water shortages online.

It's a small case, but it's the same detention pattern behind the monthly repression totals covered earlier in this briefing. 

Closing comments

Sideways on the decree's practical effect, up on the sanctions track. Sherritt International's 120-day exclusivity with Gillon Capital over its Cuban nickel stake, disclosed 13 July 2026, expires 12 October 2026; that is the first dated point at which a named foreign investor must decide whether to commit new capital to a sector whose monopoly operator and lead trading house are both under OFAC designation, testing in practice whether Decree 325's flexibility offsets the September designations or is overtaken by them.

Different Perspectives
US Treasury (OFAC) and State Department
US Treasury (OFAC) and State Department
OFAC designated Banco Exterior de Cuba and four traders on 3 September; its SDN entry links the individual named alongside them only to Alejandro Castro Espín. The State Department's own announcement, not OFAC's listing, called that individual "a grandson of Raul Castro" and the designated entities exploiters of Cuba's resources "for the benefit of the regime."
Cuban government (Foreign Minister Bruno Rodríguez Parrilla)
Cuban government (Foreign Minister Bruno Rodríguez Parrilla)
Rodríguez answered the 3 September designations on Cubadebate the same day without naming any of the five sanctioned entities, calling the wave collective punishment. Havana has used the same anti-blockade framing for each prior wave rather than contesting individual designations.
Observatorio Cubano de Derechos Humanos
Observatorio Cubano de Derechos Humanos
OCDH's Madrid-based survey found 94 per cent of Cubans in extreme poverty and 84 per cent distrusting Havana's own reform measures, fieldwork closed three weeks before Decree 325. The group monitors from exile because independent rights monitoring cannot operate legally on the island, and Lowdown could not reach a comparable on-island voice.
Dominican Republic
Dominican Republic
The Dominican Republic ordered nine Cuban diplomats and their families to leave on 13 August without stating a reason, a rupture Havana has not been given an explanation for. Neither government has since clarified what prompted the expulsion.
Russia
Russia
The Russian embassy in Havana said on 31 August that expanding BRICS full membership is not on the agenda, declining the upgrade Cuba had sought before the New Delhi summit. Moscow remains Cuba's most reliable outside supplier but stopped short of the diplomatic step Havana wanted.
China
China
Foreign ministry spokesperson Guo Jiakun called China-Cuba cooperation open, transparent and legitimate on 11 August, after the 6 August designations reached Cuban military attachés posted to China and Russia. The statement named no new assistance.