The foreign exchange market in Cuba is undergoing transformation 

As reported by the Government of the Republic, the Central Bank of Cuba has been working to create the conditions for initiating transformations in the foreign exchange market, based on the principles of gradualism and temporality.

Different exchange rates currently coexist in the Cuban economy, which generates distortions, encourages informality, and hinders the banking and fiscal traceability of economic events.

This exchange rate transformation seeks to restore the convertibility of the Cuban peso, strengthen monetary institutions, and move forward in an orderly manner toward exchange rate and monetary convergence.

A foreign exchange market requires minimum conditions of macroeconomic stability, operational capacity of the banking system, and a regulatory framework adjusted to current conditions.

The combination of severe external restrictions, the sharp drop in foreign exchange earnings, the contraction of its supply in the official foreign exchange market, as well as accumulated imbalances, determine the start of the exchange rate transformation with a gradual and responsible approach.

The strategy, focused on restoring the purchasing power of the national currency, is to concentrate and guide the foreign exchange market by connecting the various economic actors—both state and non-state—in the production, export, and marketing of goods and services at competitive prices.

An immediate unification of the exchange rate, without a transition period, could cause a sharp devaluation, with inflationary effects greater than the current ones and a further loss of purchasing power of the national currency against foreign currencies.

International experience shows that, in economies with accumulated exchange rate imbalances, transitional schemes with multiple segments allow distortions to be corrected gradually without severe macroeconomic shocks.

Considering the above, it has been decided to implement measures to ensure the transformation of the foreign exchange market on December 18, 2025. In this first stage, the structure has been designed to have three exchange segments, two fixed exchange rates (already in place), segment I operating at 1 to 24, segment II operating at 1 to 120, and a third segment with a floating exchange rate that will be published daily by the Central Bank of Cuba in its capacity as the country's monetary authority.

The decision to recognize a third segment is based on the objective existence of differences between the official exchange rates and the real value that reflects the shortage of foreign currency.

The first two market segments will be maintained in such a way as to prevent sharp devaluations of exchange rates and, therefore, of the value of the national currency, thereby protecting the population in basic and sensitive transactions and preserving stability and predictability in the prices of essential goods and services.

The third segment, based on a daily floating rate, will make it easier for exporters and other foreign currency suppliers to sell at a competitive price, determined by supply and demand. The aim is to encourage the entry of foreign currency into the exchange market, which will constitute a source for its operations and reduce pressures and irregularities in the informal market.

The transformation of the exchange market is part of a set of financial, commercial, tax, and other measures that comprise several simultaneous fronts with the aim of improving the overall efficiency of the economy.

Among the measures to be implemented, the stabilization and progressive strengthening of the so-called MLC accounts stands out, contrary to what some have falsely speculated or claimed. The objective is clear: to strengthen the purchasing power of the MLC and its use value.

As part of this plan, the operability of bank accounts for non-state forms of management will be guaranteed, allowing them to execute transactions in foreign currency both domestically and in foreign trade operations.

I would like to conclude by emphasizing that the purpose is not to replace one distortion with another, but to gradually close the monetary gaps that affect the economy and families.

The legal provisions that will implement the changes in the foreign exchange market will be published in the Official Gazette and will enter into force on Thursday, December 18, 2025. Going forward, the Central Bank of Cuba will publish the daily exchange rates on its website.

The exchange rate transformations are not an end in themselves, but a tool to bring order to the economy and strengthen the financial system. This is a gradual, responsible, and transparent process, in line with the specific conditions in Cuba.

In the coming days, we will continue to provide information about these decisions and the processes and mechanisms that will govern them.

What will be the sources of foreign currency for the exchange market?

- Remittances and transfers from abroad.

- Transactions at bank branches and currency exchange offices.

- International card and prepaid card transactions.

- Other sources involving the sale of foreign currency to the market.

- Exporting entities that generate foreign currency will also be able to sell foreign currency to this market.

This represents an important incentive for the export sector to develop and increase its contribution to the country's development, as it will be able to receive higher revenues in pesos for the foreign currency it generates.

This will enable entities in this sector to afford to pay better salaries to their skilled workforce and, in general, improve the conditions in which they carry out their productive activities.

Legal regulations of the Central Bank of Cuba governing these measures

- Resolution 127 on the Foreign Exchange Market.

- Resolution 128 Foreign Exchange Market Regulations.

These come into force once published in the Official Gazette on December 18.

Objectives of the foreign exchange reforms

- To regulate the country's foreign currency flows (through the Central Bank).

- To boost the growth of exports and foreign income.

- To create a more favorable environment for investment.

- Enable economic actors to carry out their activities safely and legally through the banking and financial system.

How do these reforms respond to the government's program to correct distortions and boost the economy?

They contribute to General Objective No. 1: Advance the implementation of the Macroeconomic Stabilization Program.

"Gradually restore macroeconomic balances through the application of fiscal, monetary, and exchange rate policies that allow for the reduction of inflation, the convertibility of the national currency, and guarantee a favorable environment for economic growth, development, and the process of socialist construction."

"Efforts must focus on the main fronts (fiscal, monetary, and exchange rate) and on generating foreign exchange earnings."