Cuban President Raul Castro on Saturday said Cuba would steer clear of neoliberal policies, but continue to modernize its socialist system through economic reforms.

In a keynote address at the 7th Congress of Cuba's Communist Party (PCC), Castro said the island's economic model would not break with the ideals of social justice adopted by the 1959 Revolution.

"The neoliberal formulas that propose privatizing state patrimony and services such as health and education will never be applied in Cuba," said Castro, also first secretary of the party, during a two-hour speech.

"The new trend is seeking to make way for the return of neoliberalism," said Castro, adding "we must confront it" by promoting revolutionary measures.

Over the past five years since the last PCC congress, the government has spearheaded many economic and social reforms, and while much remains to de done, Castro said, it would be done deliberately.

"We are advancing without haste, but without delay as well, with a comprehensive approach to assure success," he said, reporting that 21 percent of 313 guidelines (reforms) have been implemented, 77 percent are in the works and 2 percent have not gotten off the ground.

Cuba's complex dual currency system, slated to be gradually phased out, has been an obstacle to implementing some of the economic reforms, Castro said.

As a result of the economic reforms, the island has a budding private sector that has become an important source of jobs, now employing about half a million workers, noted Castro, urging the PCC and legislators to pass laws to protect and benefit this segment of the population.

However, he added the government will continue to administer the country's key industries and strategic production sectors.

"We recognize the importance of private property and we will continue to engage with small and medium-size private entrepreneurs, but our state is the sole owner of our industries," he said.

The reforms have not been without their problems, he noted, saying officials need to stay alert to a growing wealth gap.

The island's gross domestic product (GDP) has grown an average of 2.8 percent a year in the last five years, said Castro, despite such obstacles as the US-led trade embargo.

"Cuba has improved its financial credibility over the last five years and is restructuring its old debt with many countries, even though the U.S. blockade remains in place," he said.

Cuba is simultaneously implementing political reforms, said Castro, mentioning a pilot program underway in two provinces "to separate more clearly the work of People's Power bodies and government administration, with a view to extending successful practices across the country."

Still, he defended the country's one-party system as promoting stability, and noted that while the U.S. has a two-party system, both parties are accountable to the wealthy, not the common people.

"It is no accident that those who want to weaken us attempt to divide us into many parties, in the name of bourgeois democracy," he said.

He acknowledged one of the weaknesses of the government was a lack of transparency, and said efforts were being made to promote greater communication and openness.

As Cuba moves forward, it will aim to diversify its economic cooperation partners, and boost foreign investment through the special economic development zone and port of Mariel.

"The development of the national economy, along with the struggle for peace and ideological clarity, are the party's principal missions," Castro said.