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Puerto Rico sees no debt payment ability until 2022
Source: Reuters
#BUSINESS NEWS JANUARY 24, 2018 / 11:11 PM / UPDATED 2 HOURS AGO
Puerto Rico sees no debt payment ability until 2022
Nick Brown
4 MIN READ
(Reuters) - Puerto Rico’s governor projected his bankrupt, hurricane-ravaged U.S. territory will carry budget gaps for the next four fiscal years, leaving nothing to pay back the island’s $72 billion in bond debt until fiscal year 2022.
Governor Ricardo Rossello made the projections in a revised fiscal turnaround plan released overnight on Thursday.
The plan assumes a minimum of $35.3 billion in federal aid to help the island recover from Hurricane Maria, which devastated Puerto Rico in September, through the U.S. Federal Emergency Management Agency’s (FEMA) public assistance program.
A previous turnaround plan, approved by Puerto Rico’s federally appointed financial oversight board last April, had projected $800 million a year for debt repayment, roughly a quarter of what it needs annually. That was before Maria slammed Puerto Rico, killing dozens, cutting power to all 3.4 million residents, and damaging and destroying tens of billions of dollars in housing.
The new plan projects that Maria will spur increased inflation and nearly triple a contraction in gross national product this fiscal year, as well as drive some 600,000 more people from the island in the next five years.
-snip-
Puerto Rico sees no debt payment ability until 2022
Nick Brown
4 MIN READ
(Reuters) - Puerto Rico’s governor projected his bankrupt, hurricane-ravaged U.S. territory will carry budget gaps for the next four fiscal years, leaving nothing to pay back the island’s $72 billion in bond debt until fiscal year 2022.
Governor Ricardo Rossello made the projections in a revised fiscal turnaround plan released overnight on Thursday.
The plan assumes a minimum of $35.3 billion in federal aid to help the island recover from Hurricane Maria, which devastated Puerto Rico in September, through the U.S. Federal Emergency Management Agency’s (FEMA) public assistance program.
A previous turnaround plan, approved by Puerto Rico’s federally appointed financial oversight board last April, had projected $800 million a year for debt repayment, roughly a quarter of what it needs annually. That was before Maria slammed Puerto Rico, killing dozens, cutting power to all 3.4 million residents, and damaging and destroying tens of billions of dollars in housing.
The new plan projects that Maria will spur increased inflation and nearly triple a contraction in gross national product this fiscal year, as well as drive some 600,000 more people from the island in the next five years.
-snip-
Read more: https://www.reuters.com/article/us-puertorico-debt-fiscalplan/puerto-rico-sees-no-debt-payment-ability-until-2022-idUSKBN1FE0AN