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Tuesday, September 26 2017 @ 05:11 AM AST

Cuba economy has become more service-oriented: Moody's

Cuba used to have a relatively more diversified economic base in the early 1990's with industrial production accounting for a larger share of GDP, Moody's Investors Service said in its December report on Cuba.

Moody's said: "Over the past two decades, the industrial sector has shrunk and the economy has become far more service-oriented (see Exhibit 2). This dynamic reflects the growing importance of the tourism sector, which continues to support hard currency inflows to offset the country’s trade deficit."

The tourism sector is Cuba’s most significant foreign currency earner, Moody's said. "Although prone to substantial lags, Cuba’s incomplete balance of payments data suggest that the service balance reports consistent surpluses that drive the overall current account into small surpluses in most years. In 2014, Cuba received 3 million tourists, primarily from Canada. Overall tourist arrivals increased by 5.3% in 2014 from 0.5% in 2013. In the first half of 2015, following the US announcement that it would ease travel restrictions to Cuba, overall tourist arrivals grew 15.9% when compared to the same period a year earlier. Most visitors to Cuba are from Canada, followed by Germany, the UK, France, and Italy. Venezuelan tourist arrivals in Cuba experienced the largest growth in the first half of the year, growing 61.5% compared to the same period a year earlier."

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