SPRINGFIELD, Mass. (WWLP) – Economists fear the reform plan to turn around Puerto Rico’s dire economic situation is too severe, and could leave the U.S. territory in worse shape.
The five-year plan released last week includes salary freezes for government employees, creation of a fiscal control board and deep budget cuts for cities and towns and the University of Puerto Rico.
However, even if fully implemented, the government would still face a $14 billion financing gap and also be unable to meet debt payments as scheduled.
Carlos Gonzalez, President of the MA Latino Chamber of Commerce, told 22News, “Communication with Congress needs to continue to happen. It’s critical and essential to have the right formula in place for the short term and long term solution to the economic crisis that exists in Puerto Rico.”
The White House has repeatedly said a federal bailout is not planned, but a growing number of U.S. politicians are pushing for Puerto Rico to have access to Chapter 9 bankruptcy.