Category: Finance

National Shipping of America Expands San Juan Service

JOC Staff | Oct 03, 2013   National Shipping of America has expanded its Isla Verde Express service with the addition of a southbound call at Port Everglades in Florida. The expansion provides a connection between the U.S. mainland and Puerto Rico with a two-day transit time. Previously, the service, which was launched earlier this year, offered a direct route between Houston and San Juan, Puerto Rico, on a fortnightly basis. The port rotation now is Houston, Port Everglades, San Juan and back to Houston. The addition of the Port Everglades call does not impact southbound transit times between...

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Puerto Rico reveals record deficit from FY 2012

SAN JUAN, Puerto Rico — Government officials have revealed that Puerto Rico’s overall deficit stood at a record $39 billion in the past fiscal year, adding to gloom over the economy.   The figure was made public late Monday in an annual audited report that Puerto Rico is required to submit to federal officials who oversee the municipal securities market. It’s a $5.4 billion increase from the 2011 fiscal year and comes as the U.S. territory struggles to emerge from a seven-year recession. “The numbers are transparent and demonstrate the critical state of the government’s finances,” Jaime Perello, president...

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Is Puerto Rico the next Detroit?

by Julio Saenz • August 29, 2013 • 9:25 am This week’s issue of Barron’s financial newspaper has Puerto Rico as its cover story.  The in-depth story compares Puerto Rico’s precarious financial situation to Detroit’s recent bankruptcy and warns it could be 10 times worse if the island’s government does the same. Some of the key numbers reported in the article are that only California and New York State have more total debt than Puerto Rico.  Obviously those states are much larger so Puerto Rico’s average debt per resident  “of $14,000 is 10 times the average of the 50 states.”  It adds up to $70 billion in debt and that is not including $30 billion in unfunded pension liabilities. The prospects for getting out from under the debt are bleak, the island’s economy has been stuck in a recession since 2006 and unemployment is over 13%. The good news that there are  major differences between Puerto Rico and Detroit. As the author Andrew Bary explains: “Puerto Rico has taken painful and politically unpopular steps to cut bloated government payrolls, raise taxes, and shore up its badly underfunded pension system. A new government elected in 2012, led by the populist Governor Alejandro García Padilla, is committed to putting Puerto Rico and its various bond-issuing authorities on a stronger financial footing. “ Those cuts, that have led to the strikes by government...

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Puerto Rico’s new budget

By Cate Long April 29, 2013 Puerto Rico Gov. Alejandro García Padilla unveiled a $9.83 billion operating budget Thursday night during a state of the commonwealth address in which he pledged to reduce crime, create jobs, boost school attendance and expand the U.S. territory’s tourism sector.   The proposed spending package is $783 million more than the current budget, which will be covered by new revenue and $200 million in deficit financing, he said.   García Padilla said that beginning in December, the sales & use tax (IVU by its Spanish initials) will be lowered to 6.5 percent from the current 7 percent level, without impacting billions of dollars in outstanding bonds backed by the tax.   The proposal was being undertaken in tandem with measures to widen the base of the IVU, eliminating some exemptions, which would end up raising additional revenue. The plan would continue to exempt items including prescription medicine, books and non-processed foods. Thomson Reuters Municipal Market Data analyst Dan Berger wrote this after the budget presentation: In 2012, the commonwealth’s economy expanded for the first time since 2005, but Puerto Rico’s tepid economic recovery now shows substantial signs of sputtering – a turn that worries owners of $53 bln of Puerto Rico municipal debt.   As Puerto Rico’s underlying economic fundamentals erode, bond investors want to get paid more for the risk of owning...

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Fuera Ponce en Marcha del presupuesto

Dinero para todo menos Ponce en Marcha.Diez proyectos relacionados al Plan Ponce en Marcha han sido dejados fuera del nuevos presupuesto operacional del Departamento de la Vivienda (DV) y del Departamento de Recursos Naturales y Ambientales (DRNA) para el nuevo año fiscal 2010-2011. Esto, en menosprecio a la sentencia del Tribunal Supremo en el caso Ponce en Marcha en que se ordenó a las agencias de gobierno a hacer los ajustes presupuestarios necesarios para cumplir con la ejecución de los proyectos pendientes. Las obras representan $56.1 millones en inversión para la Ciudad Señorial. “Yo no voy a dar un...

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