Puerto Rico Economic Pulse ©
By H. Calero Consulting Group Puerto Rico Economic Pulse© • • • • • 0 Comments

11/2018: A Plan with More Questions Than Answers

Opportunity Zones may just provide a much-needed response
Puerto Rico Opportunity Zones MapThe latest Federal Oversight Board’s (FOB) certified fiscal plan (October 2018) reveals a coherent, but dangerously limited understanding of PR’s present economic situation. In effect, it provides a one track-logic, based on reform and austerity measures, expected to yield the necessary cash flows to both repay the renegotiated public debt and achieve economic self-sustainability. Unfortunately, the problem is not so simple. Sustainable debt repayment requires a viable expansion of the Island’s tax base, which, in turn, requires long-term sustainability of economic activity. On a more fundamental level, the attainment of these goals requires economic development and growth. In this sense, the Opportunity Zones (OZ) initiative is a definite step in the right direction that could provide what the plan lacks. It remains to be seen however, particularly given PR’s dismal record of execution and operationalizing such initiatives, whether OZ can channel the investment capital that PR badly needs now.

By H. Calero Consulting Group Puerto Rico Compass© 0 Comments

Q3/2018: Is PR’s Economic Recovery a Mirage?

Is Puerto Rico's Economic Recovery a Mirage?Analysis of Puerto Rico’s Q3-2018 Economic Indices
During the past decades, Puerto Rico has not been known for its execution of economic plans.  Last year, Hurricane Maria put us to the test and Q3-2018 results appear to reflect positive gains.  In fact, many of these gains could be the result of a devastatingly poor Q3 last year, so any small gain this year would appear as a solid road to economic recovery. However, a meager Leading index signals “we are not there yet.” We still need to execute an economic plan to rescue PR from being left behind. Competition from China is formidable, and we have not seen the full effects of a trade war between US and China. Big companies demand a large, skilled workforce, city amenities, and transportation. Mr. Trump’s negative perception of Puerto Rico or worse, our local use of federal disaster monies, adds to the Island’s perils. We need policymakers to focus on these issues.