Cuban Culture, The Enduring Spirit Of Havana, And A Tariffs Shrug-Off

Havana has a colorful history; from its heyday as the playground of rich Americans and Europeans until the last mid-century, to a sanctioned state that the Trump administration considers a malicious actor—amply demonstrated by Cuba being relisted as a “state sponsor of terror” on January 31 through an executive order. This reversed a more lenient position from the former Biden government.

The island state, the largest by far in the Caribbean, maintains a vibrant arts and music scene in the capital. Amid regular electricity blackouts and half-empty shelves in stores and pharmacies, Havana’s residents are resilient. The glitzy glamour may have gone, but vintage style and a deep-rooted energy and vitality remain.

Moreover, despite being heavily sanctioned, Cuba continues to have prominence—even preeminence—on the world stage thanks to its renowned cigars. There is rising demand in China which has led to record sales, despite huge price rises in some regions.

The country’s other famous export—rum—is far more accessible, and the leading brand, Havana Club, has made its way onto retail shelves in 125 countries with one notable exception: the United States. Sanctions mean that the product is embargoed in one of the industry’s biggest markets, which accounts for about one-third of global rum sales.

Yet ‘el ron de Cuba’ has thrived globally. While its home market had been the revenue driver for many years—and Havana Club remains Cuba’s top-selling rum with a commanding 60% market share according to drinks analyst IWSR (2023 data)—today, exports are close to 80% of sales. Of 45 million bottles sold worldwide in 2024, 61% made their way into Europe, and 14% into Latin America and Canada.

In the U.S.—not that it matters to Havana Club—rum has “slipped into decline from 2022 to year-to-date,” said IWSR last November. The analyst noted: “Rum has seen mixed, but generally underwhelming, performance over the past few years in the U.S.” Previous years showed a pandemic ‘bump’ of 4% from 2019-2020 and 2% from 2020-2021, well below the 5% growth in the overall spirits business for both periods.

Havana Club sails past tariffs

In these unpredictable days of Trump’s changing tariffs—which are very likely to raise prices—not having to deal with the U.S. is considered a blessing in some quarters of the drinks industry.

Companies are finding ways of mitigating potential downside effects, from halting imports to temporarily switching focus to alternative markets, which is the case for a string of drinks players including Netherlands-based Navy Island Rum, Macduff International, and Vancouver-based Mark Anthony Group.

Havana Club isn’t having to duck and dive. CEO, Christian Barré, can afford to take a more relaxed approach. He told me: “There is still no clear view on the road ahead for global spirits such as Scotch, tequila, cognac, and maybe Champagne.” A raft of tariffs is scheduled to arrive on August 1, but based on previous form, that could be a movable feast.

Earlier this year, Marten Lodewijks, president of IWSR US, said: “The Trump administration’s policies on tariffs will almost certainly be net negative for the U.S. alcohol market, with global implications likely to be more limited.” The analyst admitted that modeling the various potential scenarios is complicated by a number of unknowns such as the scope of tariffs, their duration, and the impact of retaliatory measures.

Barré said: “In this environment, the only thing you can do is make sure your product holds onto its brand values and heritage and build your brand’s image on this. You have to stay true to what you believe and defend and protect it.”

Cuban identity is deeply ingrained

Havana Club’s image is entwined with—and inseparable from—Cuba. The rum celebrates the country and its people, and it is very much reciprocated. Alongside the capital’s world famous Malecón, a sweeping seafront promenade that is a UNESCO world heritage site, and neo-classical or modernist casas such as Adela, Italia, and Pamela, to the music of Compay Segundo, Buena Vista Social Club, Beatriz Márquez, and acapella groups such as the Cuban Vocal Quartet; the island’s favorite rum has its own pioneering place among them.

In modern Havana, amid artists’ studios like that of Vicente Hernández, or the sculpture workshop of José Villa Soberón, “Havana Club is everywhere, like a national symbol,” said Barré proudly. The downtown Havana Club Museum is an indicator of the rum’s influence. It is ranked among the top places to visit in the city by Tripadvisor, and seeing visitors and locals break out into spontaneous salsa or Danzón is not unusual.

But Havana Club hasn’t become an institution on its own. The state-owned brand formed a joint venture with what is now the drinks giant Pernod Ricard in 1993, setting the stage for international adventure. “The brand has always resonated, but the JV really gave it a push. In the export market, just before the deal, it was selling 200,000 cases and now it’s four million,” said the CEO.

The business is quite big for a Cuba JV at 550 people, and another 50 internationally, mainly in Paris. In 1993, there were just six staff, indicating the scale of international development in three decades—from exports to ‘friendly nations’ like the former Soviet bloc to 125 countries today. Cuba still commands a hefty 22% of global sales, and remains the biggest country market, followed by France, Britain, Germany, and China.

Keeping the Cuban spirit alive

Havana Club is a very much a powerhouse in Europe and Latin America. The upgraded positioning of expressions like Selección de Maestros and Tributo through the new Icónica branding revealed last year is expected to bring more consumers knocking at the door. The five lines in the range are limited on production volumes except for Selección, and the crowning glory is Máximo Extra Añejo (with just 1,000 bottles produced annually).

The smart move to split the range means that the core, everyday collection retains its Havana Club badge, while the higher end becomes Icónica by Havana Club. “It is a quality assurance, designed for aficionados looking to buy something different, unique, specific—and top quality,” Barré told me. To get that message across, Icónica concentrates on heritage and storytelling, with a focus on European markets to start with.

Premiumization is the strongest growth lever for rum globally, with dark rum leading the premium segment. The share of premium-and-above dark rum rose from 11% in 2019 to 17% in 2024, while super-premium rums (aged 8+ years) are forecast to grow at 6% CAGR through 2028. Craft and aged rums are gaining traction among Millennials and Gen Z, who seek authenticity and complexity.

Back in Havana, whether it is in historic restaurants or bars like La Guarida and Floridita, or modern rooftop and arts/dance spaces like Sibarita and Fabrica de Arte Cubano, Havana Club is always prominently displayed, and frequently poured.

New rum markets and China’s potential

Naturally, Barré would love this scenario to play out across the globe. That takes time, so the rum continues its brand-building in earnest. “Today’s footprint is mainly Western Europe, but we are expanding in the Americas: Canada, Mexico, Chile, and Argentina. Also Eastern Europe and Asia.”

He noted some retail markets like Switzerland have become significant for the Icónica range. “In specialty stores, consumers are looking for really great products. Switzerland is big for Máximo, for example, and therefore gets a very good allocation.”

Barré is also bullish on China. While not a big rum market to date, it is growing for Havana Club. “Despite everything we hear about the difficulties in China around cognac and whisky, the Chinese remain focused on premium international brands like Havana Club, so things are going pretty well there; rum is a new option for consumers. It is still small, but growing very nicely,” he commented.

In China, people forget that many brands are still selling mainly into Tier 1 cities like Beijing and Shanghai, but Tiers 2 and 3 remain largely untapped, and most have far bigger populations than New York or Los Angeles. Five have populations above 10 million and 13, including Wuhan, have populations between 5-10 million. Across China, there are 65 cities with more than a million people compared to 14 in the United States (source: World Population Review).

Barré said: “Many consumers defend nationalism and drink local products like baijiu (白酒), but they are also very interested in new categories and new tastes and this is where rum is interesting because it is sweeter and is easy to mix, making it more accessible. For us, China is a great mid-to-long-term opportunity along with other Asian countries.”

In the first half of Pernod Ricard’s 2025 fiscal year, Havana Club was one of just three among 13 ‘strategic international brands’ to see any growth, even though it was only 1%. The other two were much bigger whisky houses: Ballantine’s and Chivas Regal. It seems that Barré’s split-range strategy to premiumize is working, and that the spirit of Cuba is all set to make waves globally.