Cries In The Dark
Bloomberg Businessweek Middle East|16 October, 2017

Puerto Rico was in financial trouble before Hurricane Maria. Now its crisis is almost existential

Michelle Kaske
Cries In The Dark

“This is, without a doubt, the biggest catastrophe in modern history for Puerto Rico,” Governor Ricardo Rosselló said after Hurricane Maria pummelled the US territory with floodwaters and 155 mph winds. He declared that his priorities were “not a fiscal consideration. It’s restoring people’s security and restoring normalcy.”

Normalcy, however, is something Puerto Rico hasn’t experienced in a while. That’s because the government is essentially bankrupt. Years of runaway borrowing to plug budget shortfalls, a decade-long recession, and the exodus of residents seeking work in the mainland US pushed the commonwealth in May to seek creditor relief from nearly $74 billion of debt, the nation’s biggest municipal bankruptcy. The island’s budget and spending now have to be approved by an oversight board appointed by the federal government. That board says that Puerto Rico can use only $1 billion from its budget to deal with hurricane damage. The tab for Maria’s destruction could reach $30 billion.

There are dire and immediate consequences. For now, officials are rightly focused on people’s safety and bringing back power and running water, rather than calculating when and how much Puerto Rico can repay its bondholders, about a third of which are hedge funds. The government-owned electric utility, the largest US public power provider, has had its aging system ripped apart by the hurricane. US Department of Energy officials and American Public Power Association staffare working with the Puerto Rico Electric Power Authority, the island’s main electricity provider, to repair transmission lines and restore power.

Denne historien er fra 16 October, 2017-utgaven av Bloomberg Businessweek Middle East.

Start din 7-dagers gratis prøveperiode på Magzter GOLD for å få tilgang til tusenvis av utvalgte premiumhistorier og 9000+ magasiner og aviser.

Denne historien er fra 16 October, 2017-utgaven av Bloomberg Businessweek Middle East.

Start din 7-dagers gratis prøveperiode på Magzter GOLD for å få tilgang til tusenvis av utvalgte premiumhistorier og 9000+ magasiner og aviser.

FLERE HISTORIER FRA BLOOMBERG BUSINESSWEEK MIDDLE EASTSe alt
Golfing With The Enemy
Bloomberg Businessweek Middle East

Golfing With The Enemy

Did Donald Trump's executives violate the Cuban embargo?

time-read
10+ mins  |
August 16, 2016
Super-Rich Syrians Wait for War's End
Bloomberg Businessweek Middle East

Super-Rich Syrians Wait for War's End

Actor, author, playwright. Gill Pringle tries her hand at unravelling the mystery behind this enigmatic multi-hyphenate

time-read
10+ mins  |
July 01, 2016
Pam Codispoti
Bloomberg Businessweek Middle East

Pam Codispoti

The mastermind behind the industry-shaping Chase Sapphire Reserve Card sets her sights on banking

time-read
2 mins  |
January 16, 2018
This Time It's The Economy
Bloomberg Businessweek Middle East

This Time It's The Economy

President Rouhani’s budget sets offprotests from people angry about unemployment and inflation

time-read
5 mins  |
January 16, 2018
Saudi Prince Counts On Support Of Citizens
Bloomberg Businessweek Middle East

Saudi Prince Counts On Support Of Citizens

State-worker salary increases appeal to the people, but policy may throw the budget off track

time-read
3 mins  |
January 16, 2018
Stalin's Legacy Is Choking The Ukrainian Economy
Bloomberg Businessweek Middle East

Stalin's Legacy Is Choking The Ukrainian Economy

The government has resisted pressure to lift a ban on land sales, despite pressure from the IMF and investors

time-read
4 mins  |
January 16, 2018
Catastrophe Bonds Survive A Stormy Year
Bloomberg Businessweek Middle East

Catastrophe Bonds Survive A Stormy Year

The turbulence of 2017 couldn’t destroy a market for betting against disasters

time-read
3 mins  |
January 16, 2018
Riding The West Bank's Credit Boom
Bloomberg Businessweek Middle East

Riding The West Bank's Credit Boom

Increased consumer lending is creating a bubble in the West Bank

time-read
3 mins  |
January 16, 2018
You'd Be Crazy To Buy Pizza With Bitcoin
Bloomberg Businessweek Middle East

You'd Be Crazy To Buy Pizza With Bitcoin

Speculative fervour makes the cryptocurrency clumsy for commerce

time-read
3 mins  |
January 16, 2018
What If The President Loses His Party?
Bloomberg Businessweek Middle East

What If The President Loses His Party?

Trump has to figure out a way to work with Republicans in Congress, or the global economy may be at stake

time-read
6 mins  |
August 16, 2017