On September 29 the government announced that the sugar ministry would be closed and turned into a holding company. But the measure is just the beginning of a broader reorganization adopted at a Council of Ministers meeting on September 24, the government insiders said.

The shake-up includes the elimination of the Basic Industry Ministry, with some of its wide-ranging duties going to new ministries of Energy and Mining.

The changes are aimed, in part, at achieving greater efficiency and profitability by reducing the government's role in state enterprise clusters called Unions of Companies.

In Cuba's economy, most state companies are managed by government ministers, who historically have appointed executives, reviewed all plans, set salaries and prices, controlled imports and exports, managed partnerships with foreign firms and conducted endless inspections.

Castro's push to preserve Cuban socialism through reform will move many of those responsibilities to the companies by making them independent of the ministries and giving them greater autonomy to manage funds and take business decisions.

The reform package would move more than 20 percent of the state's 5 million workers to an expanding "non-state" sector in retail and farming, decentralize some revenue collection, eliminate subsidies in favor of targeted welfare and lift some restrictions on buying and selling personal property.

The reforms, to be adopted over five years, would make central planning more flexible, and the government would move from running the economy to regulating it, mainly through "taxation."