Puerto Rico Economic Pulse ©

October 2005: Fiscal Mess in Puerto Rico

Or is it an opportunity?

Credit rating agencies are carefully scrutinizing PR’s finances. For the next few months, S&P and Moody’s will be once again evaluating the liquidity of the central government, in order to determine if yet another credit downgrade is in order for PR. This situation already occurred in May of this year and is not new, proving true that “those who forget their history are doomed to repeat it”. Puerto Rico faced a similar situation in 1975 and tough decisions were taken to correct the mess. The island is once again in the middle of a fiscal mess, with public debt taking center stage. Find out what is the history behind our public debt and why it is necessary to find solutions to this problem now.