HAVANA -- Container ships laden with food and consumer goods from Europe and Asia plow daily into Havana Bay, a body of water virtually empty five years ago. The daily arrivals in the harbor are a sign that, bit by bit, Cuba's economy continues to recover, even though life remains hard for the average Cuban.

The economy grew 5.6 percent last year and is projected to grow another 5 percent in 2001, Economics Minister Jose Luis Rodriguez reported in late December. Both rates were well ahead of the Latin American average of 3 percent.

But Rodriguez acknowledged that the effects of economic growth have yet to trickle down to ordinary Cubans.

``Important limitations are still faced when it comes to people's daily lives,'' Rodriguez acknowledged in his annual report to the National Assembly, or parliament.

The collapse of the Soviet Union a decade ago led the island's gross national product to shrink by some 40 percent, and a full recovery to the GNP level of 1989 may still be years off.

Prices for non-rationed food remain extremely high for most Cubans, said Rodriguez, and more homes need to be repaired and built, and public transportation must be improved.

``There are a lot more things to buy now, but our pensions are the same,'' said Lifa Isabel Barroso, a retiree in her 60s who sells crocheted shawls and doilies to tourists in Old Havana. Her monthly pension is 80 pesos, the equivalent of a little more than $4.

BETTER CONDITIONS

Still, things are much better than the early 1990s -- grim years marked by severe shortages of food, petroleum and just about everything else. Cubans went months without eating meat, blackouts were regularly scheduled to save fuel, and the streets were devoid of motor vehicles because there just wasn't any gasoline available.

``Life can still be difficult for all Cubans,'' especially elderly people who need special foods and medicines, said Augustin Cruz, 42, who sells wooden statues at an artisan market. ``But overall, the economic situation is about 80 percent better than 1993,'' the year that's generally considered the roughest for those who endured.

Much of Cuba's current economic growth has been attributed to tourism, which Rodriguez described as ``the most dynamic factor in our economy.'' The industry has grown at an average of nearly 19 percent a year over the past five years.

FORECASTS FAIL

But the industry failed to live up to expectations in 2000, when 1.8 million people visited the island. It was only a 10 percent increase over 1999, well below official growth forecasts.

Foreign investment, meanwhile, ``continues growing and playing a complementary role in our development,'' Rodriguez said.

`MIXED ENTERPRISES'

Since foreign companies first got the green light to invest on the island in 1995, 370 ``mixed enterprises'' -- partnerships between outside investors and the Cuban government -- have been formed. By year's end, that translated into foreign investment of $4.3 billion.

The sugar crop, once all-important, has suffered under chronic drought. Officials expect only 3.7 million metric tons from this harvest, a 10 percent drop from a year ago.

Such news would once have been devastating, but the Soviet collapse taught Cuban authorities the dangers of not diversifying. Economic planners responded by developing tourism, fish exporting and mining industries.

The average monthly government salary over the past year increased 7.3 percent to 249 pesos, which works out to a bit less than $12 at government exchange rates.

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