Governor Luis Fortuño, former governor of Puerto Rico and former Republican Member of the U.S. House of Representatives from Puerto Rico
Rep. Hernández Montañez, Chairman of the House Treasury Committee
Alejandro Brito, President of Brito Development Group (BDG), LLP
Moderator : Dante Disparte, founder and CEO of Risk Cooperative
On March 21, ASP hosted an event highlighting the crisis in Puerto Rico, especially focusing on the financial, political, and energy-related fields. The island, America’s largest Caribbean territory, has long been an important U.S. geopolitical outpost and now finds itself on the verge of catastrophe under the weight of massive debt and a costly, inefficient energy supply.
As Congress recommits itself to a resolution, understanding the issues plaguing Puerto Rico through the lens of energy security and risk management offers opportunities to reverse the current trends, gain political support and address the future of 3.3 million U.S. citizens on the island.
The panelists offered different ideas of how to address the problems, but they all agreed on the severity of the situation. Dante Disparte noted the viscous cycle of Puerto Rico spending too much public money, raising taxes, and losing their tax base as the richest move en masse to the mainland. Rep. Hernández Montañez emphasized, after describing how little money is left on reserves, that, “There is a willingness to pay, but we cannot fulfill our contract obligations.”
Alejandro Brito went a step further, saying that, “Puerto Rico is like that person who is obese, gambles, or drinks alcohol and trying to quit … This time it will be different.” His suggestion was for a “trainer” who can get them back on track is a federal fiscal control board. He noted how this type of board has worked in places like Italy and DC before. Brito cited some major investment problems Puerto Rico faces, such as legislation to prevent big-box stores from building on the island, retail and casinos dying out, local credit unions not providing funds to support other businesses, and more.
“I don’t blame politicians, I blame the system,” Brito said. “Let’s get the house in order, then focus on the status.” Allowing Puerto Rico to file for Chapter 9 bankruptcy would be the first step to recovery, he continued.
Governor Luis Fortuño laid out his suggestions for solutions, namely reestablishing rule of law, providing full transparency, sustaining economic growth that is beyond spending more, prioritizing creditors, avoiding default, and implementing the right public policies to improve credibility.
“It would be impossible for people like Alejandro [Brito] to invest without knowing [all options],” Fortuño concluded.
See footage from the event below:
Check out our event pictures (All rights reserved):