The energy crisis in Cuba demonstrates the extent to which structural problems in the economy can affect everyday life.

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Halfway through the workday, a food factory in Cuba loses electricity. The machines grind to a halt, the production line comes to a standstill, and workers are left waiting as products requiring refrigeration risk spoiling.

Without power, packaging processes cannot be completed, and production cannot maintain its usual pace. Every hour of disruption means less food available for distribution, financial losses, and delayed deliveries. When electricity is restored, the factory must restart its equipment and reorganize the workday in an attempt to recover some of the lost production.

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This scene, which illustrates the daily challenges facing Cuba’s state-owned industrial sector, has a particular feature: in many companies across the country, workers report to their jobs whenever electricity is available. Often, this means starting production in the early hours of the morning, at midnight or one o’clock.

The economic and energy blockade imposed on the island has contributed to forcing numerous state-run enterprises to halt or scale back production. The consequences ripple through the economy, ultimately affecting people’s daily lives, from food availability to access to basic hygiene products, textiles, and footwear.

Given its impact, restoring the public sector’s productive capacity is the first pillar of the package of economic and social measures approved by Cuba’s parliament during an extraordinary session held on June 18, 2026.

Expanding the powers of state-run enterprises, decentralizing decision-making, advancing digital transformation, and establishing the National Institute of Business Assets are all part of a program aimed at revitalizing the Cuban economy without relinquishing sovereignty over strategic resources or abandoning the social achievements of the Revolution.

Energy: A Decisive Factor in Production

Light industry is one of the sectors most severely affected by energy constraints, given its role in supplying essential goods to the population.

“The shortage of fuel and energy has had a direct, significant, and substantial impact on light industry production, which ensures the supply of basic consumer goods to the population, including personal hygiene products, textiles, and footwear,” explained Carlos Boggiano, Production Director at the Light Industry Business Group.

The executive provided figures illustrating the scale of the difficulties: during the first quarter of 2026 alone, the sector received just 6% of the fuel it had received during the same period ofthe previous year. Faced with this situation, enterprises have had to seek alternatives to keep their operations running, protect jobs, and make the most of available resources.

“We have adopted different approaches to maintain production, including remote work,” said Lissette Alonso Morales, First Vice President of the Chemical Industry Group. She explained that, in industries operating shifts and continuous production lines, teams have been organized with workers who live near their workplaces. Alternatives involving electric mobility have also been explored, with companies assessing the purchase of electric vehicles, including bicycles and tricycles.

The measures also include reassigning workers to priority activities to preserve their jobs and ensure they are not left without support. These organizational solutions are intended to sustain production under the extraordinary conditions Cuba is facing, imposed by Washington.

However, adapting to the emergency does not replace the need for decisions that improve business performance, restore productive capacity, make better use of resources, and establish mechanisms that enable enterprises to respond swiftly to the needs of the economy.

Giving in to adversity will never be an option. Preserving the achievements of the Revolution also requires finding new ways to produce, manage, and distribute wealth.

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Economic Transformation Without Abandoning the Social Project

As of June 2026, Cuba had 20,394 entities within its institutional framework, according to the National Office of Statistics and Information (ONEI). Of these, 2,082 were state-run enterprises and 234 were public micro, small, and medium-sized enterprises (Mypimes, in Spanish).

The scale of the business system underscores the importance of the proposed transformations. Its performance directly affects domestic production, employment, state revenues, and the country’s ability to ensure the provision of goods and services to the population while protecting its most vulnerable members.

The Cuban government acknowledges its own mistakes and shortcomings but places these challenges within a context also shaped by the consequences of more than six decades of the U.S. economic blockade. In response to this reality, the country has undertaken successive processes to assess and update its economic and social model.

Among the most recent precedents are the transformations approved by the Communist Party in 2011, which laid the groundwork for a process of change that continues today through the 176 economic measures presented in June 2026. These measures aim to correct distortions, reactivate the economy, and increase national productive capacity.

According to the assessment presented, the process launched in 2011 yielded positive results until 2019, when the U.S. government substantially intensified its sanctions policy. Hostilities escalated further in January 2026, following the first year of Donald Trump’s new presidential term.

During a televised appearance, Cuba’s Prime Minister Manuel Marrero recalled that the country had established a guiding principle for these transformations: preserving the Revolution’s main achievements. The proposals are rooted in the ideals of Fidel Castro Ruz and do not represent an abandonment of the pursuit of socialism, but rather an essential condition for its preservation.

“The current circumstances have made it necessary to move beyond views that mechanically equated socialism with egalitarianism,” Marrero said. “In this regard, socialist planning does not exclude market rules; it must incorporate and regulate them in accordance with national development objectives.”

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Greater Autonomy for Socialist State-Owned Enterprises

The first pillar of the 176-measure package focuses on the socialist state-owned sector and proposes a significant expansion of its powers and management autonomy. The proposals include allowing enterprises to engage in any lawful activity, greater decentralization in setting wholesale and retail prices, and increased flexibility in deciding how to use and allocate profits once tax obligations have been met.

The reforms also propose restructuring the Higher Organizations of Business Management (OSDE). These organizations would receive broader powers to establish state-owned enterprises and Mypimes, approve subsidiaries, and make decisions regarding mergers, liquidation, or restructuring processes. They would also be able to determine their own organizational structures and staffing levels.

Another area of reform seeks to modify the relationship between the state budget and the business system. To this end, the proposals include reviewing financial obligations and subsidies, designing new financial instruments, and establishing mechanisms to monetize business assets and attract investment.

Decentralization would also extend to provincial and municipal governments, which could establish, merge, or dissolve local state-run enterprises. At the same time, the package proposes eliminating the existing salary scale within the state-run business system. It would be replaced by a minimum wage that takes inflation into account. The proposal seeks to link remuneration to the country’s actual economic conditions and create opportunities for negotiations among the parties involved.

The measures also include two proposals concerning work arrangements. The first would allow retired workers to be rehired for the same positions they used to hold. The second would authorize enterprises to contract their own employees to perform certain additional services beyond their regular contractual duties, for as long as they are carried outside their normal working hours.

Another novelty is the creation of procedures for corporate bankruptcy, liquidation, and restructuring, as well as the possibility of converting socialist state-owned enterprises into joint-stock companies or companies with equity interests. In these cases, the state would maintain its presence in each sector of the economy and retain a majority stake in those considered strategic for national development, including agroindustry, the pharmaceutical and medical sector, science, technology, and innovation, among others.

Taken together, these provisions seek to give state-owned enterprises greater autonomy to organize their operations, manage their human and financial resources, and make decisions aimed at boosting production and improving efficiency.

Digital Transformation as a Tool for Development

Modernizing the state business system goes beyond administrative and financial changes. Another key pillar of the proposed reforms seeks to promote digital transformation in the service of the population and national development. The measures include the creation of a national technology hub integrating hardware, software, and artificial intelligence, conceived as a foundation for modernizing the country’s digital capabilities.

The proposals also call for incorporating artificial intelligence into public administration under human supervision, as well as implementing competitive compensation systems in the technology sector to strengthen its ability to attract and retain professionals. In terms of investment, the measures expand opportunities for foreign capital to participate in areas such as data centers operated by state-owned telecommunications company ETECSA, mobile networks, and other digital infrastructure.

These proposals position technology as a strategic component of economic transformation, both for its potential to increase productivity and for its capacity to improve public administration and services.

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The National Institute of Business Assets: Supporting Transformation

As part of the measures outlined in the Government’s 2026 Economic and Social Program, Cuba officially established the National Institute of Business Assets (INAE), a national-level entity tasked with guiding and supporting the transformation of the state-owned business system.

Joaquin Alonso Vazquez, head of the Ministry of Economy and Planning (MEP), stressed that the Institute must not become an obstacle to business autonomy.

“The Institute’s functions will not trespass the business autonomy we seek to promote; its essential role will be to provide training, supervise, and make proposals. State-run enterprises belong to the entire people, and the Institute will be responsible for representing Cuba’s nine million citizens in demanding that social ownership operate as efficiently as possible and fully meet its social obligations,” he explained.

Roberto Ricardo Marrero, president of the INAE, dismissed speculation that the new structure could become an oversized bureaucratic apparatus.

“It will not be a bureaucratic apparatus; it will be a small team, with only the staff essential to carrying out its duties. Our priority will be to ensure that every step in this process of necessary and urgent transformation is sound, and that any obstacles or mistakes that arise are addressed in a timely manner,” he stated.

The Institute will have the authority to propose the establishment of state-run enterprises of national interest. At the provincial, municipal, and local levels, it will maintain a supervisory and supportive role.

RELATED: Cuba and the Dual Challenge of Resisting the Blockade and Transforming Its Economy

Economic Sovereignty Versus the Privatization of Resources

The transformation of Cuba’s business system is taking place amid regional challenges marked by fiscal deficits, investment needs, and Latin American governments’ search for new sources of revenue. Faced with these difficulties, some countries have opted to transfer public companies and essential services to the private sector, raising questions about who manages these resources, how prices are set, and what guarantees are in place to protect public access.

According to Privatization in the Latin American Context: Perspectives, a study by Peruvian economist Alejandro Indacochea, Latin America has privatized infrastructure assets and social services worth more than US$45 billion. However, generating revenue through these transactions does not, by itself, resolve a fundamental question: how can the benefits of economic activity be distributed, and how can essential services remain accessible to the population?

Argentina is one example of this debate. The latest economic indicators place the poverty rate in the South American country at 32.3% of the population. In this context, President Javier Milei’s government has promoted a privatization program that includes AySA, the state-owned company responsible for drinking water and sanitation services in the City of Buenos Aires and 26 municipalities in Buenos Aires Province. The highest financial offer, submitted on October 8, 2026, amounted to USD $340.2 million for 90% of the shares owned by the national government.

But how is the value of a strategic company that provides an essential service to millions of people determined, and how can it be guaranteed that drinking water reaches everyone, especially the most vulnerable?

For Argentine columnist Osvaldo Peralta, the sale of AySA does not automatically prove that the private sector will fail. What is at stake, however, is the ability to ensure that an essential resource reaches every household, with reasonable rates, tangible infrastructure projects, and transparent oversight.

“Ultimately, the government can present privatization as a victory for its economic program. But the outcome will not be measured by promises of billion-dollar investments; it will be measured by the households that gain access to drinking water, the sewer systems that are built, and the bills consumers have to pay. Water may change hands, but the responsibility to guarantee the service does not disappear with the sale,” he said.

In contrast, Cuba is pursuing a different strategy: strengthening state-owned enterprises, expanding their management autonomy, and decentralizing decision-making while opening up new opportunities to attract private and foreign investment. The goal is to mobilize capital, technology, and productive capacity without relinquishing public control over sectors considered strategic to national development.

The issue is not whether to exclude private participation, but rather to determine the conditions under which it can be incorporated into the economy and who retains the authority to make fundamental decisions. Under the model Cuba seeks to develop, private investment can help modernize companies, expand production, and generate resources, while the state maintains a majority stake in strategic sectors and retains responsibility for guiding economic development.

Producing More to Protect Social Achievements

The energy crisis demonstrates the extent to which structural problems in the economy can affect everyday life. When a factory shuts down its machines due to a lack of electricity, the consequences go beyond the equipment coming to a standstill: fewer goods are available, deliveries are delayed, costs rise, and the ability to meet the population’s needs is undermined.

Against this backdrop, Cuba faces the challenge of reviving its economy amid energy constraints, financial difficulties, and unilateral coercive measures with extraterritorial reach.

Today, the challenge lies in striking a balance between economic efficiency, national sovereignty, and social justice amid a crisis imposed by Washington. A more productive state-owned enterprise must do more than contribute to the country’s finances: it must be able to ensure the supply of food, goods, and services, sustain employment, and support a development project in which national resources translate into opportunities for the Cuban people.

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European Union leaders will meet in Brussels on 15–16 October under pressure to address surging energy costs, Russian hybrid attacks, continued support for Ukraine and the bloc’s next long-term budget. The summit comes as economic pressures expose growing differences between national governments.

European Union leaders are preparing for a two-day summit in Brussels dominated by the economic consequences of the Middle East conflict, Russia’s continuing war against Ukraine and mounting pressure on governments to reconcile defence commitments with deteriorating public finances.

The European Council meeting on 15–16 October will bring together the leaders of the 27 member states to consider immediate measures addressing high energy prices alongside longer-term decisions on competitiveness, enlargement, migration and the EU’s budget for 2028–2034.

European Council President António Costa has placed economic competitiveness and energy costs at the centre of the discussions, reflecting concerns that the disruption of global oil and gas markets is threatening the bloc’s industrial recovery.

The meeting also takes place against the background of renewed disputes over national spending limits, with Italy and Greece seeking greater freedom to finance energy relief and France facing increasing pressure over the credibility of its budget.

Energy crisis puts fiscal rules under pressure

The Middle East conflict has created a renewed energy shock for European economies, raising transport and industrial costs while pushing inflation higher.

The disruption of shipping through the Strait of Hormuz has also affected global oil supplies, exposing Europe’s continuing dependence on internationally traded fossil fuels despite efforts to diversify imports following Russia’s invasion of Ukraine.

European leaders are expected to consider targeted and temporary support measures for households and businesses, as well as longer-term policies intended to reduce energy dependence.

The political disagreement concerns how those measures should be financed.

The European Commission has resisted requests from Italy and Greece for further exemptions from the EU’s fiscal framework. Both governments argue that extraordinary energy costs require additional budgetary flexibility.

Brussels maintains that existing provisions already permit exceptional expenditure within defined limits.

The disagreement is particularly difficult for indebted governments that must simultaneously finance military expansion, maintain public services and protect their economies from energy inflation.

France’s position has added urgency to the debate. Its borrowing costs have increased sharply as investors question whether the government can adopt a credible budget ahead of the 2027 presidential election.

A summit agreement on emergency energy assistance would therefore have to accommodate substantially different national fiscal circumstances.

Ukraine and the changing transatlantic relationship

Support for Ukraine remains a central item on the summit agenda as Russia continues attacks against Ukrainian cities, energy infrastructure and industrial facilities.

EU leaders are expected to review military and financial assistance, the implementation of sanctions against Moscow and the resilience of Ukraine’s economy.

The discussions take place amid renewed uncertainty surrounding American weapons deliveries.

Washington’s reported threats to suspend supplies under the NATO-backed PURL procurement arrangement have raised further questions about Europe’s dependence on the United States for advanced military equipment.

European governments have increased defence expenditure and committed additional support to Ukraine, but replacing American capabilities remains difficult, particularly in air defence, precision-guided weapons and certain intelligence systems.

The summit is unlikely to resolve those industrial limitations, but the broader question of Europe’s ability to sustain Ukrainian defence over several years will influence discussions.

Member states must also consider how increased defence expenditure will be financed alongside other demands on national budgets.

Russian hybrid operations move higher on the agenda

The EU’s published summit agenda includes Russian-linked hybrid attacks within Europe.

The issue has gained prominence as European governments investigate sabotage, cyber operations, information interference and threats against infrastructure and defence-related industries.

Recent warnings concerning possible Russian assassination operations targeting European defence executives and employees of companies supplying Ukraine illustrate the changing nature of the security threat.

Such activities place additional demands on national intelligence services, police forces and European institutions responsible for cross-border cooperation.

The EU has strengthened its sanctions instruments against hybrid activities, but enforcement remains dependent on coordination between national authorities.

Any further measures would need to address intelligence sharing, protection of critical infrastructure and the relationship between internal security and the Union’s wider Russia policy.

A larger EU with a contested budget

Enlargement will form another important part of the discussions following the Commission’s proposals for preparing a wider Union.

Brussels has outlined possible institutional safeguards intended to prevent future members from undermining democratic standards or blocking common decisions.

Montenegro and Albania are advancing through their accession negotiations, while Ukraine and Moldova remain central to the EU’s geopolitical enlargement strategy.

The financial implications will become increasingly important as governments negotiate the next multiannual financial framework covering 2028–2034.

Existing members are already divided over how much the EU should spend, which programmes should receive priority and whether additional common resources should be raised.

Agricultural expenditure, cohesion funding, defence investment and support for Ukraine will compete for resources within the same budget negotiations.

The Commission argues that enlargement can be accommodated through targeted reforms, but securing agreement among member states will require decisions on future expenditure and the distribution of financial benefits.

Competitiveness and the single market

Leaders will also examine progress on the One Europe, One Market agenda, which aims to reduce barriers to economic activity within the EU and improve conditions for European businesses.

The initiative is intended to address structural weaknesses affecting investment, industrial development and the ability of European companies to compete internationally.

High energy prices have made those concerns more immediate, particularly for industries competing against producers in economies where electricity and fuel are cheaper.

The European Council will be asked to provide direction on measures planned for 2026 and 2027, but implementation will depend on subsequent legislation and decisions by member states.

The October meeting brings several unresolved European policy questions into the same negotiation: how to protect economic competitiveness, maintain fiscal credibility, finance defence, sustain Ukraine and prepare for enlargement.

The immediate test will be whether leaders can agree on a credible response to energy prices without reopening broader disputes over national budgets.

More difficult decisions concerning defence financing, institutional reform and the EU’s long-term expenditure commitments will extend well beyond the two-day summit.

The European Commission has rejected demands from Italy and Greece for additional exemptions from EU spending rules as the Middle East energy crisis drives inflation higher, exposing renewed divisions over how much financial assistance European governments can provide.

The European Commission has rejected requests from Italy and Greece for greater freedom to increase public spending in response to the energy crisis, resisting pressure from two member states that argue existing budget restrictions are limiting their ability to protect households and businesses.

The decision, confirmed on 8 October, follows renewed appeals from Italian Prime Minister Giorgia Meloni and Greek Prime Minister Kyriakos Mitsotakis for measures recognising the exceptional financial burden imposed by higher energy prices.

Meloni wants Brussels to take greater account of unexpected inflation when assessing national budgets and to permit additional tax revenue generated by rising prices to be used for energy relief. Mitsotakis has sought the exclusion of temporary support measures for consumers and businesses from the expenditure limits agreed under the EU’s fiscal framework.

Economic Commissioner Valdis Dombrovskis rejected the argument for further concessions, maintaining that the existing arrangements already take inflation into account and provide mechanisms for responding to exceptional circumstances.

The disagreement comes as Europe’s governments confront the economic consequences of the Middle East conflict, including higher fuel costs, inflationary pressures and increased demands for state intervention.

Italy’s increasingly difficult budget choices

For Italy, the dispute adds to a fiscal problem that has been developing throughout the year.

The government expects its budget deficit to rise to 3.4 per cent of GDP in 2027, reversing an earlier objective of reducing borrowing below the EU’s three per cent reference value.

As EU Today reported earlier this month, Rome plans to use additional fiscal room for defence and energy-related expenditure, while public debt is projected to remain close to 138 per cent of GDP.

The new request concerns the treatment of inflation and the financial support required to offset its effects.

Energy inflation creates an unusual budgetary problem. Governments can receive additional nominal tax revenue as prices rise, particularly through consumption taxes, while simultaneously facing public pressure to compensate consumers for higher living costs.

Meloni argues that such unexpected revenue should be available for targeted assistance without forcing equivalent reductions elsewhere in national expenditure.

Brussels is reluctant to accept arrangements that could turn temporary increases in tax receipts into an opportunity for permanent spending expansion.

Italy’s position also reflects the political competition between defence spending and domestic economic support. Rome has accepted the need for higher military expenditure but faces immediate pressure from households and energy-intensive industries.

That competition was already apparent when the government chose to prioritise energy relief over the full use of defence-spending flexibility.

Greece seeks different treatment for emergency support

Greece’s request is more narrowly focused on the treatment of temporary assistance under the EU’s expenditure rules.

Athens argues that measures intended to help businesses and households manage exceptional energy costs should not be counted against the normal spending limits.

The Greek government faces an economic environment in which higher imported energy prices threaten household purchasing power and business profitability, particularly in sectors dependent on transport and fuel.

Excluding temporary relief from expenditure calculations would give Athens additional room to intervene without breaching its agreed fiscal trajectory.

The Commission, however, has resisted establishing further exemptions beyond those already provided in the fiscal framework.

Its objection is institutional as well as financial. If additional categories of emergency expenditure are repeatedly excluded from fiscal calculations, the system becomes increasingly difficult to enforce consistently across the Union.

The limits of Europe’s reformed fiscal rules

The EU revised its fiscal governance framework in 2024, introducing nationally agreed expenditure paths intended to provide greater flexibility while maintaining sustainable public finances.

The Commission’s rules on exceptional circumstances permit member states to depart temporarily from normal requirements under specified conditions.

Those provisions have already been used to accommodate higher defence expenditure, while the Commission has also issued guidance on their application to energy-security investments.

Temporary financial assistance intended to reduce household energy bills, however, is not necessarily treated in the same way as investment in infrastructure that reduces Europe’s long-term dependence on imported fuel.

That distinction has become a source of friction between Brussels and national capitals.

Governments argue that the immediate economic effects of an international crisis require exceptional measures. The Commission is concerned that repeated concessions could weaken the credibility of the spending framework.

A wider dispute over Europe’s economic response

The Commission’s decision also comes as France faces increasing pressure over its debt and budget deficit.

The deterioration in French borrowing conditions has reinforced concerns about the risks associated with heavily indebted governments continuing to expand expenditure.

France, Italy and Greece have different fiscal positions, but the problems confronting them originate partly in the same combination of expensive energy, weak economic growth and competing spending commitments.

The dispute will now feed into preparations for the European Council meeting on 15–16 October, where energy prices and economic competitiveness are prominent agenda items.

EU leaders are expected to consider targeted and temporary measures to reduce the burden on businesses and consumers, alongside longer-term initiatives intended to reduce dependence on fossil fuels.

The Commission’s refusal to provide Italy and Greece with further fiscal exemptions establishes the limits within which those discussions will take place.

National governments remain free to introduce assistance, but Brussels is insisting that they account for its cost within the fiscal rules already agreed.

For Rome and Athens, the question is whether those rules provide sufficient room to respond to an energy crisis whose duration remains uncertain.

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European Union governments have committed €17.9 billion this year to measures intended to protect households and businesses from rising energy prices as disruption in the Middle East and global fuel markets continues to feed through into European inflation.

Twenty-five of the EU’s 27 member states have adopted some form of energy support during 2026, according to the latest assessment of the measures.

More than two-thirds of the spending consists of measures that directly suppress energy prices rather than targeted income support.

The figure has increased since the Commission’s spring economic forecast.

Measures adopted or sufficiently detailed by 4th May were then estimated to cost €14.5 billion, equivalent to around 0.07 per cent of EU GDP. The Commission calculated that extending those measures until the end of 2026 could increase their cost to €38.6 billion.

National measures include reductions in fuel taxes and excise duties, energy vouchers, direct financial assistance and support for companies facing higher production and transport costs.

The Commission has repeatedly urged governments to concentrate assistance on vulnerable households and particularly exposed industries rather than subsidising energy use across the entire economy.

Its spring assessment found that roughly three quarters of the support then in force was not targeted specifically at vulnerable consumers or energy-intensive companies.

Broad price measures can reduce household bills immediately, but they also carry a larger fiscal cost and reduce the incentive to cut consumption when supplies are constrained.

The present shock began with disruption to oil and gas supplies caused by the Middle East conflict.

The Commission responded with its AccelerateEU package of emergency and structural measures, allowing governments to use measures including income support, energy vouchers and lower electricity taxes for vulnerable households.

Brussels says Europe does not currently face an immediate security-of-supply problem for the winter of 2026–27 because supplies have been diversified and strategic reserves remain available.

Price exposure is a different matter. Europe still depends heavily on imported fossil fuels, leaving domestic businesses and consumers exposed when world-market prices rise.

Recent trade figures underline the scale of that vulnerability. EU Today reported last month that Europe’s petroleum import bill increased by 55.8 per cent in the second quarter compared with the same period of 2025, despite only a 1.2 per cent increase in the volume imported.

Natural gas presents another risk. European storage sites entered the autumn at unusually low levels, with EU Today reporting that EU gas stocks were around 67 per cent full in mid-September, leaving the bloc more exposed if winter demand rises sharply.

Pressure has now spread into refined fuel markets as well. Russian diesel exports are restricted, Middle Eastern supply remains vulnerable and China has suspended most fuel-product exports outside Hong Kong and Macau. Washington is simultaneously pressing European governments to release diesel from their strategic reserves.

The energy shock is also affecting the wider economic outlook.

The Commission’s spring forecast had already anticipated weaker growth and higher inflation. It projected EU employment growth of only 0.3 per cent in 2026 and expected the aggregate government deficit to rise from 3.1 per cent of GDP in 2025 to 3.6 per cent by 2027.

More recent Commission estimates indicate that eurozone growth in 2026 could be somewhat stronger than the earlier forecast, while expectations for 2027 have deteriorated.

Inflation is expected to remain around 3 per cent this year and to remain above earlier projections next year. That increases the fiscal problem facing governments.

Large energy subsidies can reduce the immediate impact on households but add to public borrowing and may complicate monetary policy if they support overall demand.

The European Fiscal Board has urged member states to ensure that energy measures are temporary, have clear expiry dates and are directed at vulnerable households and businesses.

The Commission is also drawing lessons from the measures adopted after Russia’s full-scale invasion of Ukraine in 2022. Energy support introduced during 2022 and 2023 alone had a net cost equivalent to about 2.1 per cent of EU GDP, according to Commission calculations.

Brussels wants to avoid a second prolonged cycle of broad subsidies while accelerating investment intended to reduce Europe’s structural reliance on imported fossil fuels. That includes grid investment, electrification, renewables and measures to reduce taxes on electricity relative to gas.

For national governments, however, the immediate pressure is coming from bills paid today rather than energy infrastructure planned for the next decade. With €17.9 billion already committed during 2026, further disruption in international oil, diesel or gas markets could determine whether what was designed as temporary support has to be extended into next year.

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The post Bangladesh energy crisis calls for pragmatism, not political purity appeared first on Asia Times.

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The post Pakistan returns to spot LNG market with fresh tender as power generation takes a hit appeared first on BOL News.