Puerto Rico's economy is trapped in a debt crisis. This crisis further threatens nearly half of the population living in poverty. As Global Ministries, we are accompanying and hearing our partner churches' and organizations' concerns about the debt; the consequences for defaulting on it; the proposals that would reduce wages; layoffs of worker; reducing employee benefits; and a reduction in health services. Drastic measures, as some sectors are proposing, will adversely affect the poor and needy in Puerto Rico. Those who lend money at high interest rates know that it is a heavy burden to the fiscal health of the people but have no authority to demand changes that would affect essential services, jobs and opportunities for an economic resurgence.
Our partner churches and ecumenical organizations have been involved in discussion and advocacy, urging the U.S. Government and the private banking sector to declare a Jubilee for Puerto Rico. Let us pray and act in favor of the people in Puerto Rico, as Jubilee USA Network has been including some of the materials to reflect and to witness a Jubilee that allow debt relief and attention to the “poorer of the poor” in the Enchantment Island.
From Jubilee USA Network:
Governor Announces Revenue "Claw-Back" to Fund Government Services
Washington DC - Puerto Rico surprised some analysts by making a scheduled $354 million debt payment and avoiding a default. In an announcement, the island's Government Development Bank said it had "paid all principle and interest payments due today on certain outstanding [debt]." Puerto Rico Governor Alejandro Garcia Padilla announced at a Senate Judiciary Committee hearing in Washington that the island's government will "claw-back" revenues designated to pay certain debts to instead pay for government services. "We have no cash left," Padilla told the committee. The US Territory owes $72 billion in total debt, which Governor Padilla called "unpayable" in June.
"With how dire the situation is in Puerto Rico, I was surprised the government made the payment," said Eric LeCompte, executive director of Jubilee USA, a religious development group. "The next chapter in this crisis is right around the corner."
In January, Puerto Rico is scheduled to make its next debt payment to the tune of $957 million.
The Senate hearing that Garcia Padilla testified at discussed proposed bankruptcy, health care, tax reforms and a federal control board to monitor Puerto Rico's finances. In its statement, the Government Development Bank called on Congress to grant Puerto Rico access to bankruptcy protection. The Bank said debt relief was necessary to avoid a "humanitarian crisis" on the island. Nearly half of Puerto Rico's population lives in poverty, and 80% of the island's children live in high-poverty areas.
"This crisis affects our citizens and we desperately need a solution that makes the debt sustainable and prevents austerity," noted LeCompte.
Read the Government Development Bank's announcement.
Jubilee USA Network is an alliance of more than 75 US organizations and 400 faith communities working with 50 Jubilee global partners. Jubilee's mission is to build an economy that serves, protects and promotes the participation of the most vulnerable. Jubilee USA has won critical global financial reforms and more than $130 billion in debt relief to benefit the world's poorest people. www.jubileeusa.org
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