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Wednesday, February 28, 2024

As chapter ends, board seeks to spice up Puerto Rico economic system

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SAN JUAN, Puerto Rico — As Puerto Rico emerges from a drawn-out chapter course of, a federal management board that oversees the island’s funds introduced Wednesday that it’s going to give attention to rising the U.S. territory’s economic system.

The board’s new govt director, former New York state funds director Robert Mujica, unveiled a brand new fiscal plan that can function the island’s financial blueprint for the close to future.

It calls for that Puerto Rico overhaul its schooling, tax and infrastructure sectors and entice extra buyers by strengthening its fragile energy grid and making it simpler to do enterprise on an island identified for its clunky forms.

“There’s no time to waste,” Mujica stated at a press convention.

Lately, the U.S. authorities allotted greater than $120 billion to assist Puerto Rico offset the impression of the pandemic and pure disasters starting from earthquakes to main hurricanes. However Mujica famous these had been “one-time infusions that quickly boosted output” and fueled financial restoration.

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The island’s actual GNP is declining, and financial progress is slowing as these funds evaporate, he added.

“These funds masks underlying, persistent weaknesses in Puerto Rico’s long run financial outlook,” he stated.

Excessive inflation — plus a shrinking and getting old inhabitants — even have contributed to the financial decline, the board famous.

Mujica stated that to assist enhance the island’s economic system, the board will meet with authorities officers, schooling leaders and nongovernment organizations to strengthen Puerto Rico’s schooling sector, which has lengthy been lagging.

The board’s fiscal plan additionally seeks a complete evaluate of Puerto Rico’s tax system regardless of latest enhancements.

“Whereas a lot progress has been made, important reform continues to be required as a result of Puerto Rico’s present tax system has traditionally suffered from complexity, instability and inconsistency,” the board stated in a press release.

The give attention to financial progress comes after the board oversaw a bankruptcy-like course of wherein Puerto Rico’s debt dropped to $34 billion from greater than $70 billion, an quantity the federal government had stated in 2015 that it couldn’t pay. Two years later, it filed for the largest U.S. municipal chapter in historical past.

“That took all of the oxygen of the room,” Mujica stated, including that the board is now focusing on fiscal well being and financial progress.

The board, which was created by U.S. Congress in 2016, will proceed overseeing Puerto Rico’s funds till the U.S. territory approves 4 consecutive balanced budgets.

Mujica stated it’s unclear if the primary one has been permitted as a result of the federal government has but to submit audited monetary statements.

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