The news out of Havana yesterday that President Fidel Castro was stepping down from formal power for his younger brother Raúl, aged 76. comes as a surprise to many Cuba-watchers. After all, there was no particular need for him to do so. His sibling has been managing affairs without apparent difficulty since Fidel took leave for abdominal surgery 18 months ago, and during what has been advertised as his recovery the latter has continued to reassure his followers through frequent commentaries in the official press or periodic appearances in carefully staged videos or still photographs.

What could have changed these last few weeks or days to cause Fidel Castro to make this announcement? Have the doctors given him new bad news? Or is he, in fact, no longer able to even speak for himself? Is he even still alive? Some day we may know the answer to these questions.

Dynastic succession within dictatorships is nothing new in today's world, as Syria and North Korea have demonstrated. But in the case of Cuba the transfer of power from one Castro brother to another reveals a more complex and interesting process. For one thing, it has been occurring in slow motion and without incident for at least the past five years, during which time Raúl has placed people loyal to him (sometimes even family members) in all the key ministries and government agencies.

For another, Raúl has long been the commander-in-chief of the Revolutionary Armed Forces, which since at least the end of the Cuban alliance with the Soviet Union have become a far more important factor of power than the Cuban Communist Party. For yet another, the same Raúl is Minister of the Interior, which is to say, he controls the police, security forces and prison system. Finally, Fidel's designated successor possesses one matchless advantage - he is fully aware of his own personal limitations. He is not his brother and he knows it. If he chooses to lift some of the stifling restrictions on commerce and production that he has been reported to be considering, he could become very popular in Cuba and very fast. There is little doubt that at this point such reforms could be carried out with a minimum of political fallout.

This is not to suggest in any way that Cuba is on its way to becoming an island version of social-democratic Costa Rica or Chile. Far from it. The Cuban revolution is now nearly 50 years old, which is to say it represents half the country's independent history. It cannot simply be written off as an unfortunate parenthesis. Most of those Cubans who do not share the Castro brothers' vision for their country have either left or are planning to leave. The fate of those who remain depends on the capacity of their leaders to adjust to the realities of a globalised world economy. Raúl Castro's ultimate position in Cuban history depends upon his capacity to understand this and to act upon it.

One might well ask why the resignation of Fidel Castro from the presidency of Cuba is an event worthy of such extensive coverage in the international press. After all, Cuba is not an intrinsically important country. It has a tiny and not particularly productive economy. As far as we know, it has no huge oil reserves. It is not located in a strategically crucial part of the world. It is not a leading cultural force in a larger religious or linguistic area. Indeed, it is seen by other Latin American countries as a kind of picturesque eccentricity to be admired and appreciated from a distance, perhaps occasionally enjoyed as a tourist destination, but not a model to be imitated: not even, apparently, in Chávez's Venezuela.

The answer, of course, lies partly in the history of the Cold War, in which Fidel Castro's Cuba played an important role in advancing the interests of Soviet communism, or at least what Castro himself regarded as those interests. Although he failed to spread his revolution throughout Latin America, for nearly 30 years Cuban military and intelligence operatives were present in much of the Third World - Angola, Ethiopia, Yemen, even (we are told) North Vietnam. For years Cubans (which is to say, Castro) controlled the Non-Aligned Movement. And, of course, at one point the Cuban dictator was willing to expose his country to an American invasion by allowing the Soviet Union to install nuclear missiles on its territory.

But there is another, more important, reason that explains his celebrity. Fidel Castro was the first leader from a small, vulnerable country - one very much in the America's historic sphere of interest - to confront Washington and live to tell the tale. He had the good fortune to take up this challenge at the time of a seismic shift in Western culture against bourgeois values and liberal economics - both quintessentially represented by the United States.

To be sure, in order to do this he had to sacrifice much of his country's independence of action to a rival power. He had to give up important economic advantages accruing from the proximity of a huge American market and access to American technology. To protect himself from the consequences of these choices he had to create a police state with all its hateful paraphernalia.

Above all, he had to gamble upon the restraint of successive American administrations: he had to know how to represent enough of a threat to restrain Washington's hand, but not so much as to force it. Like many dictators - Franco and Salazar, Stalin and Tito, Pinochet and Mao - his luck held out to the very last.

Mark Falcoff is resident scholar emeritus at the American Enterprise Institute in Washington, DC and author of Cuba the Morning After: Confronting Castro's Legacy

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