Puerto Rico should not suffer additional delays in the processes designed for fiscal restructuring and reconstruction after the devastation caused by the 2017 hurricanes. It is really concerning that the budgetary framework and the fiscal adjustment reforms necessary for revitalization will be postponed for two years.
Changes in fiscal adjustments goals agreed with the oversight authority provided in PROMESA undermine Puerto Rico´s credibility. Amid this current uncertainty in relations with bondholders and the U.S. government, it is really inconvenient to give the impression that those important steps on the revitalization agenda will take place after the elections. Postponing the goals of the certified Fiscal Plan would join those difficulties to convince bondholders to renegotiate the debt.
It could also create greater obstacles to try to convince the US government to release additional funds that crucial for reconstruction.
The call to all those involved in recovery and restructuring processes – the local government, the Board and Washington authorities related to the island´s affairs – is to reaffirm their commitment to the true priorities of the people of Puerto Rico.
Among other aspects, the fact that the certified Fiscal Plan is now reducing by 45 percent the projected five-year adjustments, that is, to $ 1,568 billion raises concerns. The commitment was to cut $ 2,848 billion in expenses in that period. Omissions , such as the "exhibits" of budgetary progress reports are also raising concerns. Eliminating these documents does not contribute to the transparency that public management should reflect.
In addition, the plan proposed by the local government now excludes freezing pensions and reduces efficiency adjustments in the government health plan.
It is necessary to engage in a constructive dialogue between the Government of Puerto Rico and the Board. Groups such as the US House Committee on Natural Resources, a body with primary jurisdiction over the island´s affairs, can contribute to this crucial task. It is positive that in their recent visit, the House Committee on Natural Resources heard, in a listening session, representatives from several sectors of Puerto Rico, and visited innovative projects related to island recovery.
The visit to the Toro Negro clean energy project in Ciales, that generates its own electricity, caused a good impression among federal Representatives. The delegation also met with Governor Ricardo Rosselló and with the Oversight Board directors, another important point of the visit.
It is also encouraging to know that the Committee, chaired by Representative Raúl Grijalva, will continue the dialogue on Puerto Rico in hearings scheduled for April.
The members of the Committee, including Rob Bishop, Darren Soto and Rubén Gallego, expressed their willingness to promote the restoration of the energy infrastructure. This crucial aspect requires parallel attention to finance balance, as part of the effort aimed at debt restructuring.
The Committee delegation, led by Democrats, have expressed their clear interest in better understanding what the island´s reconstruction implies, and their intention to review specific aspects of PROMESA. However, the Committee acknowledges that any revision would have to count on the federal Senate.
Puerto Rico needs allies, both in the House and in the Senate, where the receptivity of key bodies such as the Energy and Natural Resources Committees, chaired by Republican Senator Lisa Murkowski, will be decisive.
In these times of challenges that Puerto Rico is facing, electoral and other considerations unrelated to debt restructuring and recovery should not interfere with the processes that seek the welfare of the people of Puerto Rico.
It is everyone´s duty to ensure that our people do not become victims of electoral politics battles -at local or federal levels-. Puerto Rico can only succeed if unity and high purposes prevail.