The Hidden Power of GAESA: Cuba's Military-Run Economic Giant

Understanding GAESA's Dominance in Cuba

In Cuba, the most influential organization is not the Communist Party but a clandestine, military-operated conglomerate known as GAESA. This entity is believed to control between 40% and 70% of the nation's economy. Initially founded by Raúl Castro during his tenure as defense minister, GAESA has evolved from a military-focused enterprise into a vast commercial network that impacts nearly every aspect of Cuban society, as reported by various news outlets.

Key Sectors Under GAESA's Control

GAESA exerts significant influence over crucial economic sectors through a variety of companies, with CIMEX being its largest commercial branch. Its portfolio includes:

• Luxury accommodations and tourism facilities — GAESA owns many of Cuba's premier hotels, tourist transport services, and upscale shops.
• Fuel and retail operations — The conglomerate manages hundreds of gas stations and supermarkets throughout the island.
• Financial services and foreign trade — GAESA oversees Banco Financiero Internacional, one of Cuba's key banks, granting it substantial control over foreign currency reserves.
• Telecommunications — It operates the only internet service provider in Cuba.
• Remittance and currency exchange services — GAESA manages significant money transfer and currency exchange operations.

Profits generated from these ventures are funneled back to the military rather than the central government. GAESA functions with minimal oversight, as its financial records are not subject to state audits, and its revenues are absent from the national budget.

Origins in Economic Crisis

GAESA emerged from the economic turmoil following the Soviet Union's collapse in 1991, which left Cuba without its primary economic supporter. The military faced challenges in compensating troops and maintaining operational readiness. Fidel Castro permitted Raúl to broaden military business activities to generate income and stabilize the nation. This initiative proved effective in the short term, as the military outperformed civilian state enterprises, aiding Cuba's recovery from the 1990s economic downturn. However, as Raúl Castro solidified his power after succeeding Fidel in 2008, GAESA's influence surged.

Critics now argue that GAESA operates as a 'state within a state,' enriching military leaders while ordinary Cubans endure worsening poverty and scarcity.

Recent U.S. Actions Against GAESA

The Trump administration has targeted GAESA as a focal point of its Cuba policy. Earlier this month, President Trump enacted an executive order to intensify sanctions specifically against this conglomerate. Secretary of State Marco Rubio has labeled GAESA as a mechanism employed by Cuba's political elite to oppress the populace while benefiting themselves. 'This is a sanction against a company that is robbing the Cuban people for the gain of a select few,' Rubio stated during a recent visit. The U.S. government estimates that GAESA's revenues exceed three times that of the Cuban state budget.

Leadership and Transparency Issues

For many years, GAESA was led by Raúl Castro's son-in-law, Gen. Luis Alberto Rodríguez López-Calleja, until his passing in 2022. His successor, Brig. Gen. Ania Guillermina Lastres Morera, has connections to the Castro family through Raúl's grandson, Raúl Guillermo Rodríguez Castro, known as 'El Cangrejo,' who remains a significant behind-the-scenes figure. The lack of transparency surrounding GAESA is alarming; when Cuba's government comptroller revealed in 2024 that she had no access to GAESA's financial data, she was dismissed after 14 years in her role.

Challenges Ahead for GAESA

Despite its extensive control over the economy, GAESA's substantial investments in tourism, including the construction of numerous luxury hotels, have not resulted in sustainable growth. Hotel occupancy rates are low, and essential services like education and healthcare have suffered from inadequate funding. Economist Ricardo Torres highlighted this contradiction: 'The government complains about the embargo when it suits them, yet they continue to build these hotels as if the embargo did not exist.' As the Trump administration intensifies pressure on GAESA and the broader Cuban economy, the conglomerate's dual role as both an economic powerhouse and a military stronghold is facing unprecedented scrutiny. This secretive military conglomerate remains one of the most influential yet least understood forces shaping Cuba's future.