Puerto Rico's Debt Crisis: Challenges and Opportunities Gustavo Vélez
Since 2006, Puerto Rico has been struggling with its worst economic crisis in recent history. In early February 2014, the three main U.S. credit agencies, decided to downgrade the island’s credit to “junk status,” and Puerto Rico became the first U.S. jurisdiction to fall under this classification. After the credit downgrade, the government’s fiscal strategy continues to be based on imposing new and more taxes and on implementing short term fiscal measures. The local political leadership lacks the will to implement the structural reforms needed to get out of the economic recession and stagnant economy. Puerto Rico’s public debt per capita ascends $20,384, while the debt per tax payer is of $89,181. Nearly two years after the credit downgrade, as the economic situation spiraled, Puerto Ric...
