Puerto Rico’s
revised fiscal plan estimates the U.S. territory’s economy will shrink by 11 percent and its population will drop by nearly 8 next year. Also, the plan has no money to pay creditors for the next five years.
SAN JUAN, Puerto Rico — Puerto Rico’s governor submitted a revised fiscal plan Thursday that estimates the U.S. territory’s economy will shrink by 11 percent and its population drop by nearly 8 percent next year.
The proposal doesn’t set aside any money to pay creditors in the next five years as the island struggles to restructure a portion of its $73 billion public debt. The original plan had set aside $800 million a year for creditors, a fraction of the roughly $35 billion due in interest and payments over the next decade.
The five-year plan also assumes Puerto Rico will receive at least $35 billion in emergency federal funds for post-storm recovery and another $22 billion from private insurance companies — figures still far below the $95 billion in damage officials estimate was caused by Hurricane Maria, which hit in September.
Some analysts view the assumption of that much aid as risky given that the U.S. Treasury Department and U.S. Federal Emergency Management Agency recently told Puerto Rico officials that they are temporarily withholding billions of dollars approved by Congress last year for posthurricane recovery because they believe the island has sufficient funds.
The plan also projects a brief burst of 7.6 percent GDP growth for 2019.
The plan does not call for layoffs or new taxes.
Gov. Ricardo Rossello noted that nearly half of the island’s 3.3 million inhabitants lived in poverty prior to the hurricane and that Puerto Rico still faces an 11 percent unemployment rate. Nearly a half-million people have fled for the U.S. mainland in the past decade in search of jobs and a more affordable cost of living.
A federal control board overseeing Puerto Rico’s finances still has to approve the plan, which it envisions doing by Feb. 23.