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The agricultural component of Cuba's economy is dominated by sugar, of which it is one of the world's largest exporters. However, with the prevailing low price for the commodity throughout the 1980s and early 1990s, the Government has attempted to diversify into other crops. Tobacco and citrus fruits are of increasing importance. Cuban industry is largely devoted to the processing of agricultural products but also produces cement, fertilizers, textiles, prefabricated buildings, agricultural machinery and domestic consumer goods. Tourism, the only significant service industry, has proved to be a growth industry and a vital source of foreign exchange; the Government has invested heavily in developing infrastructure for that purpose. Overshadowing the Cuban economy, however, has long been the US economic blockade against the island. The Clinton administration had shown some signs of relaxing the restrictions, until the passage in 1996 of the so-called Helms-Burton act which penalizes foreign companies which do business in Cuba (by preventing them from doing any in the USA). Unable to trade fully effectively (even though bilateral US-Cuban trade is estimated at $300 million annually, mostly in telecommunications traffic and other instruments such as credit cards), and suffering from the collapse of the Soviet Union, Cuba has experienced persistent economic difficulties in recent years. Despite that, domestic reforms of the previously rigid state-controlled structure - and opening up to foreign investment (Helms-Burton notwithstanding) and the creation of export-processing zones - have allowed erratic growth to take place. (It is currently about 5 per cent annually). A substantial informal dollar economy has grown up during the 1990s, which has also served to improve living conditions. In the longer term, the economy needs a lifting of sanctions, which, in turn, relies on some form of political settlement with the USA. The new American administration under George W. Bush appears disinclined to make any such moves at present. Argentina, Canada, China and Spain are Cuba's main trading partners.

Under the terms of the 1976 constitution, all legislative power in the Republic of Cuba is vested in a 499-member National Assembly of People's Power, which is elected every five years by municipal deputies. A 31-member Council of State is elected by the Assembly from the Assembly. The Council's President is both Head of State and Head of Government. Executive and administrative power is vested in a Council of Ministers, appointed by the Assembly on the Head of State's recommendation. The constitution also guarantees that the Communist Party (PCC) should remain not only the sole legal party in Cuba but 'the leading force of society and state'.