Cuban President Raul Castro

Havana: (IANS) Cuban President Raul Castro has said that a “reduction in oil imports”, falling prices of traditional exports, along with other financial restrictions caused a “tense and stressful” economic situation that will bring limitations in the second half of 2016.

Speaking to the lawmakers of Cuban parliament, Castro on Friday said the island’s GDP only grew by one per cent in the first half of the year, only around half of the government’s projections, Xinhua news agency reported.

“This result was due to external financial constraints caused by falling export prices and the limitations faced by some of our major trading partners, due to falling oil prices,” said Castro in his traditional speech to end the week-long parliamentary session.

The leader said Venezuela’s crisis was affecting Cuba’s oil imports as Caracas was unable to meet the supply it agreed to as part of an agreement in which Cuba sends thousands of doctors, teachers and other advisors to the South American country.

Castro said the falling prices of traditional exports such as nickel, tobacco and rum have also contributed to the problems.

The Cuban president added that the “harmful effects” of the US economic blockade on the island continue to affect the nation.

“Three months after US President Barack Obama’s announcement that he would lift the prohibition on Cuba using the US dollar for international transactions, we have still not been able to make a single payment or cash deposit in that currency,” he said.

However, Castro denied an “imminent collapse” of the economy or a return to the  “Special Period”, a severe economic crisis which hit Cuba in the 1990s after the fall of the Soviet Union.

“We are prepared to confront this situation although we do not deny it may severely affect the population. There is no room for improvisation and even less for pessimism,” he vowed.

Despite the limitations, said Castro, the government will continue to implement economic and social reforms in order to update the island’s socialism.

Earlier in the day, Cuban Economy Minister Marino Murillo announced the country would face economic and energy restrictions in the second half of the year.