Puerto Rico News: Newspaper Reports Caribbean Archipelago Is Over $167B in Debt
The Puerto Rican government is reportedly broke, and the debt owed by the U.S. commonwealth is more than two times the $73 billion publicly estimated by government officials.
According to EFE, El Nuevo Dia, the country's largest U.S. read newspaper, described the situation as "frightening," reporting that when such variables as interest on accumulated debt, deficit accrued by retirement and public health programs are factored in, the debt owed is actually in the neighborhood of $167.46 billion.
"You don't need to be an economist from Harvard to understand that this debt is unsustainable," reads an editorial headlined "Restructuring, there's no other choice. Puerto Rico's viability as a country is at stake."
Up to now, few local leaders have publicly discussed the tourist hotspot's finances, with the editorial adding to the seriousness of the situation by claiming "over the past 15 years, the government has operated under a constant deficit."
"Poor administration and wrong decisions paved the way to a historic public debt that now has the country almost totally bankrupt," the article continues.
El Nuevo Dia editor Luis Alberto Ferre Rangel later said the newspaper was motivated to run the editorial to "focus public debate" on "recapitalizing" the Government Development Bank.
Ultimately, El Neuvo Dia traces most of the country's troubles first to the oil embargo that started in the 1970s and later to the recession that began in the 1980s and worsened over the next decade. The newspaper reported those developments led the government to "began to borrow funds in order to pay debts."
According to EFE, less than one-third of Puerto Rico's 3.5 million residents have regular jobs, yet food prices have rose by nearly 50 percent over the last 10 years. At the same time, pension systems have accumulated $34 billion in liabilities and the monies owed to bondholders is nearly $48,000 per inhabitant.
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