Puerto Rico Governor Ricardo Rossello signed a law on Sunday aimed at alleviating the United States territory’s $70 billion public debt.
According to the Associated Press, the law allows Mr. Rossello, who was sworn in to office last month, to designate certain government services as “essential” and set aside money to fund them.
Some of the government’s revenue that’s not designated for essential services will go towards paying bondholders, the AP stated.
The legislation, titled the Financial Emergency and Fiscal Responsibility Law, reportedly replaces former Governor Alejandro Garcia Padilla’s moratorium on debt payments.
“With this law we demonstrate to the entire world that Puerto Rico has credibility again,” Mr. Rossello said on Sunday.
However, the law will extend the moratorium on debt payments until May, with an option for Mr. Rossello to extend it another three months before the new system takes effect, the AP stated.
Meanwhile, Puerto Rico is also struggling for ways to reduce its unemployment rate, which at 11 percent is roughly double the United States’ national average, as well as its 45 percent poverty rate.
To that end, Mr. Rossello also signed the Labour Transformation and Flexibility Act last Thursday to a mixed response from pundits. Among other measures, the act reportedly caps severance obligations for employees fired without just case, and also makes it easier for employers to demonstrate just cause for termination.
See the Feb. 2, 2017 edition for full coverage.
{fcomment}