Macroeconomic Forecast Puerto RicoJune 2012 | Macroeconomic Forecasts
Puerto Rico's debt load continues to rise. As of end-2011, we estimate total government debt of US$66.3bn, representing just over 100% of GDP. Moreover, in the first four months of 2012, the island sold US$4.8bn worth of bonds, as investors were attracted by a full exemption from federal, state and local income taxes. However, we believe this level of debt may become difficult to sustain in the long run, noting substantial imbalances in the economy. These include weak growth, with real GNP averaging just 1.8% over the next decade, a high unemployment rate (at around 15% as of April 2012) and a weak fiscal position.
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