During the Special Period it became imperative to find new ways to replace the income and the subsidies Cuba had received from trade with the Soviet bloc. One answer was to encourage tourism. Castro had never prevented Cubans from leaving the island; what held up their departure was the refusal of other countries, including the United States, to grant visas. But foreign visitors to Cuba had been greatly restricted, mostly because of the threat of U.S.-backed terrorism (in 1975 the CIA admitted publicly that it had tried to assassinate Castro on eight different occasions).

In 1989 the doors of Cuba were thrown open to foreigners. New hotels and restaurants were constructed, beaches were cleaned up, and retail stores featuring quality merchandise at reasonable prices were opened near likely tourist attractions. All of these establishments took only foreign currency, especially U.S...