The Fantasy of the Fiscal Plan for Puerto Rico

The most recent version of Puerto Rico’s fiscal plan for its central government would chart the future of the country, giving some degree of certainty to citizens, businesses and investors to bet on the island’s dismal economy. Yet it is built on economic projections totally incompatible with the historical experience of places that have been destroyed by hurricanes the world over. The plan also clashes with what has been Puerto Rico’s economic trajectory. In the past 30 years, the economy has never reached annual growth such as that estimated for fiscal year 2019 by the financial team of Governor Ricardo Rosselló Nevares. The group is led by Christian Sobrino, governor’s representative before the Fiscal Control Board (FCB), chief economic adviser to the governor, president of the Government Development Bank and chairman of the Financial Advisory & Fiscal Agency Authority (AAFAF by its Spanish acronym); and Gerardo Portela, executive director of AAFAF and by virtue of his position, member of the boards of directors of all public corporations.

La fantasía del Plan Fiscal para Puerto Rico

Pese a toda la inversión de tiempo y fondos públicos, todos los planes coinciden a rasgos generales en las medidas basadas en proyecciones de crecimiento de la economía de Puerto Rico no sustentadas, que demuestran el alto nivel de incertidumbre que permea el proceso. Además, los planes comparten un problema esencial: ninguno refleja realmente lo que será el futuro de Puerto Rico ya que será el Tribunal Federal y el proceso de reestructuración de la deuda lo que al final del día decida cuánto dinero habrá disponible para la operación del Gobierno y cuánto irá destinado al pago la deuda pública.