“Cuba has pariah status in international capital market ratings”

MIAMI, United States. – Cuban economist Pedro Monreal harshly criticized Cuba’s financial situation and stressed that the island will have pariah status in the ratings of international capital markets in 2024, based on a recent report by the Economic Commission for Latin America and the Caribbean (ECLAC).

“Cuba will have pariah status in the ratings of international capital markets in 2024. This is confirmed by the recent ECLAC report on capital flows to Latin America and the Caribbean. It is the only country (among 26) without a rating because it does not provide information,” Monreal said in the first post of a thread on the social network X.

Cuba’s financial situation is aggravated by a series of factors that Monreal lists: a deep economic and social crisis, external sanctions, an economic program that he describes as “adrift” and an ineffective model of international insertion.

“For a country like Cuba, access to international financing is key and that is why ‘country risk’ ratings are important,” the economist said.

He also explained that, of the three main risk rating agencies – Moody’s, Standard and Poor’s (S&P) and Fitch – only Moody’s issued ratings for Cuba, usually of the “Caa” type, which corresponds to a substantial risk and is a very bad rating.

The economist also highlighted the difference between having a low rating and the withdrawal of the rating for not providing information. “There is an important difference between a low rating of the ‘Caa’ type, which is explained in each rating report, and a ‘withdrawal’ of the rating for not providing information. The first is a market mishap, the second is political nonsense,” he stressed.

Monreal also criticized the Cuban government’s lack of transparency and its attitude of secrecy, which, according to him, is seriously damaging Cuba’s perception among international creditors. “You have to have very little economic training to assume that it would not have a negative effect on international creditors (current and potential) if Cuba were the only country without a credit risk rating in the region because it seems to consider secrecy to be better,” he said.

The negative impact of this situation cannot be underestimated, according to Monreal. Cuba’s self-exclusion from international risk ratings has a devastating effect on its ability to access international financing. “No official speech, portfolio of investment opportunities in Cuba, or verbosity in ‘joint committees’ has – not even remotely – the negative impact that a country that is deeply indebted and excludes itself from international risk ratings has on creditors,” the expert concluded.

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