HAVANA, Cuba?The Roman Catholic Church warned Sunday that Cuba is on the verge of an economic collapse that can only be prevented if President Raul Castro institutes sweeping economic and social reforms.

"The economic situation in Cuba has turned rather complicated with signs that it is close to free fall," the Havana Archdiocese said in the latest edition of its "Palabra Nueva" (New Word) magazine.

Castro has responded to the crisis with "utopian statements and readjustments along the lines of severe expenditure cuts that can lead to socio-economic collapse," wrote economist-priest Boris Moreno.

Moreno said that there was "no sign at all" of the changes Raul Castro, 78, promised his people after he took over from his ailing, older brother Fidel in 2006.

The economic crisis, made worse by the global economic downturn, fuels "hopelessness" that can "break the fragile social compact," Moreno wrote.

The Cuban government admitted recently it was having cash flow problems after a disappointing 1.4 percent economic growth last year?well shy of an expected 6.0 percent.

The Castro administration has launched a savings program entailing sharp cuts in social spending and priority investment in currency-generating sectors of the economy.

Palabra Nueva, instead, said the government should promote exports and small- and mid-size businesses, provide a safe environment for foreign investment, institute business reforms, and a single currency, and allow Cubans "to give their opinions without fear of reprisal."