Trump administration’s Cuba sanctions pressure the little-known military conglomerate that runs island

The building of 'Grupo de Administracion Empresarial SA' (GAESA) is pictured in Havana on May 7, 2026. Photo by YAMIL LAGE / AFP /Getty

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The Trump administration’s maximum pressure campaign on Cuba is taking aim at the shadowy, military-run conglomerate that prevails over the island’s banking, retail and tourism sectors.

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The U.S. State Department refers to Grupo de Administración Empresarial S.A. (GAESA) as the “heart of Cuba’s kleptocratic communist system.” The umbrella enterprise, run by the Cuban Revolutionary Armed Forces, controls up to $20 billion in “illicit assets,” with revenue likely three times Cuba’s state budget, the State Department said.

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A May 1 executive order signed by U.S. President Donald Trump, as well as additional sanctions announced on May 7, broadens the U.S. government’s authority to go after GAESA, its head, Ania Guillermina Lastres Morera, and Cuba’s foreign investors, said Lee Schlenker, a research associate with the Washington-based think tank the Quincy Institute.

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“Not only are they subject to having their assets frozen, but their U.S. accounts as well as their travel to the U.S., that of their shareholders, investors or employees,” Schlenker told the Associated Press. “This is bound to have an extremely significant impact on the presence of foreign companies,” he added.

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The new sanctions put one of Cuba’s largest investors on notice. The Toronto-based Sherritt International, which mines nickel and cobalt, said last Thursday that it was suspending operations in Cuba after more than three decades.

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GAESA’s prominent role in Cuba’s economy, estimated at 40 per cent of GDP, has made it a target for Washington amid a wider push toward what the U.S. calls Cuba’s economic liberalization.

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The company was spearheaded by Raúl Castro, the brother of Fidel Castro and Cuba’s president from 2008 to 2018. Much of GAESA’s finances are hidden. It is exempt from government audits and it does not publish details about where its money goes or how it is shared with the state. Gladys Bejerano, Cuba’s general comptroller, told Spanish media about the lack of oversight in a 2024 interview and was fired.

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Leaked financial statements obtained by the Miami Herald showed that GAESA made $2.1 billion in profits in the first quarter of 2024. Its vast holdings include Cuba’s largest commercial bank and some of its priciest luxury hotels and retail shops.

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However, GAESA’s dependence on foreign currency has backfired amid low tourism and investment. Since January, the U.S. has blocked nearly all shipments of heavy oil and demanded that Cuba overhaul its political system and free political prisoners. The move came after Trump’s capture of Venezuela’s then-President Nicolás Maduro, one of Cuba’s closest allies.

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In February, U.S. Secretary of State Marco Rubio blamed GAESA for Cuba’s economic misfortunes. “None of the money that that company has generated flows to the coffers of the government,” Rubio said.