European companies from Spanish hotels to German shipping lines are ending their Cuban operations as Washington on Friday moved to intensify its decades-old embargo, expanding its focus from the regime in Havana to EU business ties to the island.
Among the hardest hit are Spain’s Meliá and Iberostar hotel groups. For decades, the lush resorts they operated on Cuba’s most idyllic beaches were the crown jewels of their global portfolios. But over the past few weeks, the hospitality giants pulled their management and branding from dozens of properties on the island, with Meliá citing an “evolving geopolitical, social, legal, and economic environment.”
The Spanish hotel groups’ exodus came just ahead of Friday’s rollout of severe new U.S. penalties targeting foreign companies that do business with Cuban state entities — especially the military-run GAESA conglomerate.
The sanctions package is part of U.S. President Donald Trump’s broader campaign to topple Cuban President Miguel Díaz-Canel’s regime, but it risks dragging the EU — the island’s largest trading partner and its main source of foreign investment — into the drama. Faced with the risk of asset freezes and exclusion from the U.S. financial system, European companies active in sectors ranging from shipping and logistics to energy and agriculture are desperately offloading their interests on the island and rushing for the exits.
Last month, French shipping giant CMA CGM and Germany’s Hapag-Lloyd suspended operations to and from Cuba until further notice. The companies, which account for an estimated 60 percent of Cuba’s shipping traffic by volume, both cited the threat of U.S. sanctions as the reason for their decision.
According to Daniel Bernbeck, managing director of the German Delegation for the Promotion of Trade and Investment in Cuba, the new sanctions are of particular concern for medium-sized European companies operating on the island.
“Smaller companies might be easily wiped off the map,” he told POLITICO. Bernbeck added that German groups involved in the country’s energy sector — which he declined to name, citing confidentiality concerns — might be at particular risk.
Susanne Gratius, a researcher of EU-Latin American relations at the Autonomous University of Madrid, said the risks now outweigh the benefits of doing business in Cuba. The new status quo risked leaving the island, which is in the midst of a dire financial crisis, in an even more extreme “kind of real isolation.”
¡Adiós, acere!
Washington’s latest sanctions take aim at the partnerships that have long underpinned Cuba’s economic relationship with Europe.
The package singles out companies working with the Cuban military’s Grupo de Administración Empresarial S.A. (GAESA) enterprise, a shadowy megaconglomerate estimated to control around 40 percent of the island’s economy, according to classified government ledgers obtained by the Miami Herald last year.
The state-controlled entity, whose finances are closely guarded, operates the country’s banking industry, gas stations, supermarkets and most of its tourism sector. The country’s hotels and resorts are not only drivers of the service sector that accounts for over 70 percent of the country’s economic output, but also a key source of the foreign currency the state uses to purchase basic necessities on the international market.
“GAESA virtually owns … the tourist sector,” U.S. Secretary of State Marco Rubio said during a Senate hearing on Tuesday.
Over half of the hotels in the country are owned by GAESA’s subsidiary, Gaviota, and nearly all are managed by foreign hospitality groups. Until this week, Spain’s Meliá and Iberostar were the dominant foreign players on the island, managing a portfolio of 52 properties that included an all-inclusive golf resort off Cuba’s iconic Varadero beach and four luxury hotels in Havana.
The fresh sanctions are hitting Cuba’s once-powerful tourism sector at a moment when it is already in dire straits. Foreign visitors have been spooked by the country’s economic woes and energy shortages, which have made rolling blackouts a routine occurrence on the island, and turned to other destinations.
As a result, Cuban tourism authorities reported a dramatic drop in annual tourist visits, from 4.7 million in 2018 to just 1.9 million last year. According to the Cuban government’s Office of National Statistics and Information, those numbers have continued to decline, with only 30,551 tourist arrivals recorded in April 2026.
Beyond tourism, European companies risk exposure to U.S. sanctions by way of their involvement in the production of one of Cuba’s most famous alcoholic exports.
Havana Club rum is produced through a joint venture between French drinks giant Pernod Ricard and the state-backed Cuba Ron company. The Paris-based spirits group has spent decades embroiled in a legal dispute over the ownership of the rum brand’s name, which is claimed by the exiled owners of the Bacardi drinks company. It’s unclear how it would be impacted by the fresh U.S. sanctions.
Pernod Ricard did not respond to POLITICO’s requests for comment regarding its operations in Cuba or exposure to U.S. penalties.
No stomach for a fight
U.S. sanctions on Cuba are already having an impact on European companies’ bottom lines, but there’s little reaction from national authorities or EU institutions.
Even though Spain has extensive economic and historical ties with Cuba, Prime Minister Pedro Sánchez’s left-leaning government in Madrid has avoided adopting a hard line on the issue.
Spain’s Economy Minister Carlos Cuerpo said Wednesday the government was “closely monitoring” the situation in Cuba and working to “minimize the impact on our companies.”
Jaume Bauzá, the regional tourism minister of Spain’s Balearic Islands, where Iberostar and Meliá are headquartered, said this week that “it is a commercial issue, but if we can help in any way, we will.”
Similarly, French and German authorities have limited themselves to saying they’re “closely monitoring” or “following” developments on the island.
Bert Hoffmann, a German researcher on Cuban affairs, said European capitals are uninterested in entering into a direct clash with Washington over the issue. Authorities have effectively accepted “the U.S. will not let Europeans have a major role in the dealings with Cuba.”
He added that countries like Spain didn’t really have a choice in the matter.
“What should Spain threaten the U.S. with?” Hoffmann asked, emphasizing Europe’s lack of real power to counteract the U.S.’s moves.
A broader, EU-led response is also unlikely.
When the U.S. passed the 1996 Helms-Burton Act, which allowed Americans to sue foreign companies using property nationalized after Fidel Castro’s revolution, the EU reacted aggressively.
European businesses were told to ignore the measure, and Brussels went on to pass a blocking statute which prohibits companies from complying with certain extraterritorial U.S. sanctions and allows them to recover damages arising from enforcement of those penalties in EU jurisdictions.
But 30 years later, and with wars raging on the European continent and in the Middle East, there’s little appetite for a fight over Cuba in Brussels.
Responding to POLITICO’s inquiries as to its plans to address the matter, a European Commission spokesperson said the EU’s executive was encouraging a “constructive dialogue” between Washington and Havana.
That stance was criticized by European Parliament lawmakers like Spanish MEP Leire Pajín, a member of the center-left Socialists and Democrats group, who said more needed to be done to take on “the U.S. embargo, which has repeatedly been condemned by the U.N. General Assembly” and protect European interests on the island.
“The European Union must defend its strategic autonomy,” she said. “It must defend European companies.”
French MEP Leïla Chaibi, a member of The Left group, was even blunter in her assessment of Brussels’ response to the threat of sanctions against European companies.
“About Cuba, we are behaving with the U.S. like a little dog,” she said.