A Puerto Rican protester holds up a placard on which is written in Spanish: “We have entered into a loan off, we saw not a penny, we will not pay. ” Photo: AP Photo / Ricardo Arduengo
Puerto Rico can not fulfill its payment obligations. Today the island has to converted 52 million euros to pay off interest on a loan, but the government announced not to do this. If no action is taken, the treasury is empty in November.
Governor Victor Suarez spoke last night (local time) the hope that a settlement can still be reached with the many creditors. He added that if no action is taken, the Treasury in November is finally empty.
The failure to pay the interest, according to the authorities have no direct consequence to bankruptcy because it would be a “moral payoff. That is according to economists still questionable. If the creditors would start a lawsuit, a bankruptcy would not have to turn away, says an economist at Associated Press.
Puerto Rico, which has 3.6 million inhabitants, has a total debt of converted more than 66 billion euros. The island is a so-called non-incorporated region of the United States. This means that it is run by Washington, but not officially part of the United States.
The island is since the 70s money to finance the government deficit, and is therefore in a vicious circle ended. The government deficit is increasing, while the debt continues to grow. In addition to mass immigration to the US mainland to Puerto Rico has a shrinking economy
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