The speech took place on the same balcony from which Fidel Castro proclaimed victory after Fulgencio Batista, the nation's corrupt former leader, fled the nation on January 1, 1959.

A series of dances and concerts also took place across Cuba, although celebrations were subdued after a turbulent year in which hurricanes devastated much of the the island and uncertainty continued over the health of the former president.

'Aggressive' enemy

Castro spoke proudly of the 1959 revolution that transformed the Caribbean island, but he warned the country must not let down its guard.

"The enemy will never cease to be aggressive, treacherous and dominant," he said.

"It is time to reflect on the future, on the next 50 years when we shall continue to struggle incessantly ... I'm not trying to scare anyone, this is the truth."

While most Cubans hail their government's achievements in education and health, many are hoping for more political and social freedoms.

Obama hopes

In a brief message on the front page of Granma, Cuba's Communist party newspaper, on Thursday, Fidel Castro sent his congratulations to "our heroic people" for 50 years of revolution.

Raul Castro has initiated some changes since taking power in February [Reuters]
The country, which has endured a much-criticised US trade embargo for more than four decades, also suffered for years after the 1991 collapse of the Soviet Union, formerly Cuba's biggest benefactor.

And in 2008, three successive powerful hurricanes left dozens dead and caused $10 billion in damages, destroying almost a third of Cuba's crops.

Raul Castro has initiated some changes since he formally took power from his brother, such as abandoning salary equality, relaxing bans on owning mobile phones, access to foreign hotels and computers and DVD players.

Many Cubans are now hoping that when Barack Obama, the US president-elect, takes office on January 20, the nation will experience improved relations with the US.

"We are very hopeful that with Obama our relatives will be able to visit us more, and send us more money," Cuban Ana Luisa Mas in Havana told AP news agency.