US Secondary Sanctions on Cuba Target GAESA Military Conglomerate, Prompting Sherritt to Withdraw
Primary region South America
Tags Trade · Diplomacy
Regions South America · US
President Trump's May 1 Executive Order imposed secondary sanctions on foreign companies doing business with Cuba's military-controlled sectors. Secretary of State Rubio designated GAESA — the military conglomerate controlling an estimated 40-70% of Cuba's economy — along with Moa Nickel S.A. and GAESA's CEO. Canadian miner Sherritt International suspended all Cuban operations within 48 hours, repatriated employees, and saw its CFO and auditor resign. Spanish hotel chains face a June 5 deadline to sever ties with GAESA's tourism arm Gaviota. Since January 2026, over 240 sanctions have been imposed and at least 7 tankers intercepted, producing an 80-90% reduction in Cuban energy imports. Power outages now reach 25 hours per day in more than 55% of the country.
Strategic interpretation
The secondary sanctions represent the most aggressive U.S. Cuba policy in decades, targeting the military's economic empire rather than just the government. Sherritt's withdrawal and the potential exit of Spanish hotel chains could devastate Cuba's already collapsing economy. The June 5 deadline is a critical test: if European companies choose to exit rather than risk U.S. sanctions, it would signal the extraterritorial reach of American economic power. However, the humanitarian cost — 25-hour daily power outages — risks generating international backlash.