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Indybay FeatureRelated Categories: Americas | International | U.S. | Government & Elections
Puerto Rico Oversight Board Mediates Last Ditch Debt Negotiations
Within weeks, Puerto Rico will likely enter bankruptcy proceedings tailored by Congress specifically for the US territory.
The island's government and creditors are engaged in final talks to try and resolve the dispute before a May 1 deadline. An oversight board created by Congress to deal with Puerto Rico's debt crisis is mediating the current round of debt talks. If no agreement is reached, the oversight board will likely vote for bankruptcy proceedings to begin.
"Whether the crisis is resolved through negotiated deals or a bankruptcy process, solutions must promote economic growth and significantly cut the debt to sustainable levels," said Archbishop Roberto González from the Catholic Archdiocese of San Juan de Puerto Rico. "The debt has human costs and how we resolve the crisis can either lift people out of poverty or trap them in a perpetual cycle of poverty."
The island wrestles with a nearly 60 percent child poverty rate. Religious leaders like González actively called on Congress to include child poverty reduction measures in debt crisis legislation passed last year.
"The most important stake holders in any debt crisis resolution are Puerto Rico's children," said Reverend Heriberto Martínez, the head of the Puerto Rico Bible Society. "We need to be sure we are investing in our children and our children don't inherit the debt."
In the summer of 2015, when the island's government announced the debt was no longer payable, religious leaders across Puerto Rico rallied to resolve the crisis. Working with US religious groups and the development organization Jubilee USA, the island's religious leaders proposed various solutions to aspects of the crisis. Now a comprehensive path to cut the debt appears in sight.
"When the oversight board votes for bankruptcy proceedings, Puerto Rico can access a comprehensive process to deal with all of their debt," noted the executive director of Jubilee USA, Eric LeCompte, who tracks the debt negotiations. LeCompte testified to Congress and the oversight board on the island's crisis. "Puerto Rico is lucky to have a process that can deal with 100% of the debt. Unfortunately it's too rare in the bankruptcy world to have comprehensive processes like this."
Jubilee USA Network is an alliance of more than 75 US organizations and 650 faith communities working with 50 Jubilee global partners. Jubilee USA builds an economy that serves, protects and promotes the participation of the most vulnerable. Jubilee USA wins critical global financial reforms and won more than $130 billion in debt relief to benefit the world's poorest people. http://www.jubileeusa.org