Puerto Rico will need an unprecedented rescue from the U.S. government to recover from the hurricane that ravaged it in September, deepening a financial crisis that had already pushed it into a record-setting bankruptcy, the executive director of the island’s federal oversight board said.
The territory will need from $13 billion to $21 billion over the next two years to keep the government operating and cover the salaries of police officers, teachers and other employees, Natalie Jaresko said in testimony prepared for the House Natural Resources committee Tuesday.
The devastating blow dealt by Hurricane Maria has upended Puerto Rico’s initial plans for pulling itself out of a fiscal crisis that built over years as it remained mired in a recession and borrowed to keep the government afloat. The damage crippled the economy and left investors wagering that it will be able to repay even less of its $74 billion of debt, causing the price of its most frequently traded bonds to tumble to about 28 cents on the dollar, about half what they were worth before the storm.
(c) 2017, Bloomberg · Rebecca Spalding, Michelle Kaske