CUBA'S president, Raul Castro, has offered to talk to the US and ease half a century of enmity following olive branches from the Obama administration.

Castro said he wanted to respond to Washington's effort to recast diplomatic relations but insisted Cuba's communist system was solid and would not be diluted. “We are ready to talk about everything but not to negotiate our political and social system,” he told the national assembly on Saturday.

The 78-year-old leader, who formally succeeded his ailing brother Fidel last year, made the announcement amid grim economic news which will curb spending on health and education, twin pillars of the 50-year-old revolution.

The government warned of further austerity in the wake of hurricane damage and a sputtering economy, a sharp contrast to glimmers of diplomatic détente.

Castro said there was a chance for negotiations now that the White House had toned down Bush-era hostility towards Havana. “It's true there has been a diminution of the aggression and anti-Cuban rhetoric on the part of the administration.”

Barack Obama has slightly eased the draconian US embargo against the island, a policy from the Kennedy administration, and made symbolic gestures such as stopping the electronic ticker from the US mission in Havana which used to taunt Cuba's rulers with pro-democracy slogans.

Castro noted however that the embargo remained in effect and he rejected comments by the US secretary of state, Hillary Clinton, linking improved relations with concessions from Havana.

“I have to say, with all due respect to Mrs Clinton ... they didn't elect me president to restore capitalism in Cuba, nor to hand over the revolution. I was elected to defend, maintain and continue perfecting socialism, not destroy it,” he said to a standing ovation. He scorned those who believe the Cuban regime would crumble once he, Fidel and other ageing figures from the revolution died, saying “If that's how they think, they are doomed to failure.”

The US used to look forward to a so-called “poof moment” when the communist system 90 miles off Florida collapsed upon Fidel Castro's death. But when illness sidelined him three years ago his younger brother seamlessly took over.

Raul Castro has offered to talk to Washington before, but doing so in a national assembly address gave the words added weight. There was no immediate response from the State Department.

“What we have here is an important and continuing effort by Raul to signal that discussions with the US are something he very much wants,” said Larry Birns, director of the Council on Hemispheric Affairs think-tank.

“Raul is conducting himself like someone who wants to be accepted as a serious discussion partner. He has been non-judgmental in his relations with the US and on occasion been relatively warm. From the US viewpoint Cuba has been on good behaviour.”

The US is the only country in the hemisphere to not have diplomatic ties with Havana, a position many critics consider anachronistic and self-defeating. Obama has authorised the resumption of talks over migration and disaster preparedness, low-level contacts which were severed during the Bush administration.

— The Guardian, London