Can Cuba pull off Chinese-style reforms to achieve strong market oriented growth under Community Party control? Can Venezuela continue mass subsidies to the island?

Will Cuba’s micro-entrepreneurs build up small and mid-sized businesses that can truly propel the island economy forward?

Those were among myriad questions debated at the 23rd annual meeting of the Association for the Study of the Cuban Economy (ASCE) held Aug. 1-3 in Miami.

This year’s gathering featured the largest attendance ever of scholars visiting from the island. The presence of some 15 Cuba-based professionals specialists in economics, law and other disciplines and critical of the island’s one-party government changed the dynamics of the annual ASCE conference.

More panels were held in Spanish than in years past, and they were peppered with details of day-to-day life on the island.

Participants offered a wider range of options for the island’s political economy including “participative socialism” and a “loyal opposition” reconciled to work with the Communist Party.

Here are some highlights of topics from the meeting, whose theme was “Reforming Cuba?”

ECONOMIC REFORMS: LIMITED AND SLOW

Carmelo Mesa-Lago, the dean of Cuban studies in the United States, called reforms enacted under President Raúl Castro since 2008 “the most important” since troops led by Raúl and his older brother Fidel overthrew the Batista dictatorship in 1959.

Mesa-Lago described three types of reforms: administrative, such as the fight against corruption; non-structural, such as permission for Cuban citizens to stay at tourist hotels; and most critical structural, including distribution of land leases to farmers.

So far, these measures are insufficient to fuel strong economic growth, Mesa-Lago said. Cuba registered 3% growth last year, below its 3.4% target and the fourth lowest in Latin America. And it posted 2.3% growth in the first half of this year, well below its 3.6% target.

Initiatives that expand the self-employed, cooperatives and other “non-state” activities still face excessive regulation, high tax rates and other hurdles. And the pace of change remains slow, he said.

Cuba plans to deepen reforms over the next 18 months, even allowing key state enterprises to keep half their profits and reinvest. But the government won’t abandon its current development model dominated by central planning and state enterprises, Economic czar Marino Murillo has said.

That limited reform plan seems doomed to fail just as it did in such ex-communist nations as Hungary, Poland and Yugoslavia, said Mesa-Lago, noting that what’s needed are more comprehensive structural reforms toward a market-oriented economy, more like what China has done.

“The biggest obstacle” to reforms and economic growth, he said, “is the model itself.”

VENEZUELAN AID TO CONTINUE, BUT HOW LONG?

Venezuela has been subsidizing Cuba for more than a decade, offering oil at cut rates in exchange for the services of Cuban professionals paid to the island at inflated prices.

Venezuela’s petroleum aid accounts for 10-12% of Cuba’s total economic activity, estimated IMF senior economist Rafael Romeu. No other country helped by Venezuela’s Petroc-aribe oil program depends so heavily on that aid, said Romeu.

But Venezuela now faces its own problems.

The oil-exporting country is mired in recession, just devalued its currency, struggles with high inflation and faces food shortages.

Venezuela’s new president, Nicolas Maduro, lacks the charisma of his predecessor, Hugo Chávez a protégé of Fidel Castro who died last March. And the Economist Intelligence Unit recently predicted that Maduro wouldn’t finish his five-year term.

“It’s very difficult for Venezuela to keep up its level” of subsidies for Cuba, said Emilio Morales, president of The Havana Consulting Group in Miami, estimating the value of that aid at $9-12 billion per year.

Still, panelists agreed that Maduro won’t cut off Cuba. Helping Havana boosts Maduro’s revolutionary credentials. Venezuela had provided cut-rate oil in the Caribbean before Chávez. And Cuba can weather cuts in oil aid better than it did the loss of Soviet subsidies, because its economy is now stronger.

ARE CORRUPTION CASES SCARING AWAY FDI?

Some of Cuba’s strength comes from foreign direct investment, said Richard Fein-berg, a Latin American advisor in the Clinton administration and now professor at the University of California at San Diego. Feinberg estimates Cuba now hosts roughly $3.5 billion in FDI, mostly in mining, rum, cigars and other large ventures active in exports. But for a Latin American nation of its size, that total should be much higher more like $25 billion, Feinberg said.

To attract more foreign capital, Cuba could move beyond its “pilot project” approach, streamline its approval process and revise its dual-currency system, under which foreign investors pay Cuba in a dollar like currency but the government pays company workers in pesos worth much less, said Feinberg.

Revamping the judicial system would help too, said Cuba based independent lawyer René Gómez Manzano. He said the government has changed its approach to fight alleged corruption by foreign investors, no longer expelling executives but instead jailing and trying them in opaque proceedings.

“It’s important to take into account the nationality of those detained,” said Manzano, citing recent cases against Canadians and Britons. “I don’t think you’d see a Venezuelan in the same situation.”

Cuba’s opaque handling of corruption cases “could lead to foreign investment going to other countries,” said Gómez Manzano, who spent two years in jail after petitioning Cuba in 1997 for broader civil rights.”

SELF-EMPLOYED: LITTLE ROOM TO GROW

While at least 430,000 Cubans now are classified as self-employed, there’s little chance for their microenterprises to blossom into strong small and mid-sized businesses, panelists said. Cuba still lacks a dynamic wholesale market, sufficient credit, business training and other conditions to grow businesses.

Many entrepreneurs rely on family and friends overseas especially in South Florida for supplies or cash to buy supplies.

That’s partly why remittances in cash and goods soared beyond $5 billion last year, said consultant Morales.

Cuba’s self-employed may not be budding capitalists anyway, said Roberto Armengol, an anthropology student from the University of Virginia who won ASCE’s award this year for graduate student papers.

Armengol’s research in Havana found the self-employed often see themselves as socialists getting by in a tough economy, helping each other out in “competitive solidarity.”

CIVIL SOCIETY ADVANCES FASTER THAN REFORMS

Cuba’s civil society is changing at a faster pace than the state and economy, participants said. For example, bloggers and artists are increasingly turning to the Internet despite the fact that the regime tightly controls online access to express wide-ranging views and post videos that reach millions worldwide.

And the Catholic Church magazine Espacio Laical just published a bold blueprint for Cuba from think-tank Casa Cuba that urges transparency in governance, mass access to Internet and other key reforms.

Tackling Cuba’s woes raises the challenge of the Communist Party “reinventing itself” to dialogue with others and a “loyal opposition” to work with the party, said Lenier González, Espacio Laical’s co-editor.

“We must learn to share the future of Cuba and recognize that an adversary is not an enemy,” González said. “That means, ‘I’m not going to wipe you out, even if I don’t share much of your agenda.”

How the politics will shake out remains uncertain. “Things are moving, but we don’t know where,” said Armando Chaguaceda, a Cuban scholar now at Mexico’s Universidad Veracruzana, who backs “democratic and participative socialism” for his homeland.

Scholars from Cuba attended the conference with funding from the Christopher Reynolds Foundation, Sobol Family Foundation and Cuba Study Group. Others from Cuban government agencies and think tanks were invited but did not come.

Said ASCE President Ted Henken: “Everyone is welcome.”