In its latest 2026 regional economic outlook published in June, the United Nations Economic Commission for Latin America and the Caribbean (ECLAC) has revised down its projected growth rate for the region from the 2.3% forecast made in December 2025 to 2.2%, with prolonged crises in Cuba and Haiti identified as the primary factors dragging down the regional average.
The UN agency’s analysis warns that 24 out of the 33 economies in the region are set to see an expansion slowdown in 2026, extending a stretch of four consecutive years where regional growth has hovered around 2.3% — a trend ECLAC characterizes as a persistent low-growth trap that limits job creation and poverty reduction across the bloc.
Cuba is expected to register the sharpest contraction across the region, with ECLAC projecting a 6.5% economic shrinkage for 2026, a deterioration from the 3.8% drop the island recorded in 2025. Haiti, meanwhile, is forecast to shrink by 1.4% this year — a smaller decline than 2025’s 2.7% contraction, but still a continued drag on overall regional performance.
The impact of these two struggling economies on the regional average is substantial: when the two crisis-hit nations are excluded from calculations, the 2026 average growth for the rest of Latin America and the Caribbean climbs to 3.9%, a modest uptick from the 3.8% expansion the region excluding Cuba and Haiti posted in 2025. This gap makes clear the outsized distorting effect of the two countries’ ongoing economic collapses on regional aggregate data.
Cuba’s economic crisis has deteriorated dramatically in the first half of 2026, triggered by a critical loss of oil imports. Following the capture of Venezuelan leader Nicolás Maduro on January 3, Cuba lost 80% to 90% of its crude oil supplies from Venezuela, which amounted to between 25,000 and 35,000 barrels of oil per day. Shortly after, Mexico suspended all oil shipments to Cuba on January 9 under pressure from the United States, and former U.S. President Donald Trump signed Executive Order 14380 on January 29, which enforces secondary tariffs on any third country that continues to export oil to the island. This oil supply shock has gutted Cuban energy infrastructure and industrial production.
Independent analysts have offered an even grimmer outlook for Cuba: The Economist Intelligence Unit projected in February 2026 that the Cuban economy will contract by 7.2% this year, a deeper shrinkage than ECLAC’s official estimate. In contrast to the collapse in Cuba, the region sees stark growth disparities, with Guyana leading all regional economies at a projected 16.3% expansion in 2026, driven by booming output from its fast-growing offshore oil sector. Venezuela follows with a projected 6.5% growth, while Nicaragua and Paraguay are both forecast to expand by 4.5% this year.
External headwinds are also adding pressure to vulnerable economies across the region. In the first three weeks of April 2026, the price of West Texas Intermediate crude oil was 74% higher than the average price recorded in December 2025, creating new global inflationary pressures that hit already weakened economies like Cuba’s particularly hard.
Cuban President Miguel Díaz-Canel’s administration has repeatedly pointed to the longstanding U.S. trade embargo as the core cause of the country’s economic collapse, and ECLAC’s data confirms that Cuba is by far the worst-performing economy in the entire Latin American and Caribbean region. Notably, the Cuban government’s official 2026 projection puts economic growth at 1% for the year, a figure that independent economists widely dismiss as completely disconnected from on-the-ground economic realities.