Rosselló: Enterprise Puerto Rico could create up to 12,000 jobs
SAN JUAN — With the potential to create from 10,000 to 12,000 jobs within the next five years, Puerto Rico Gov. Ricardo Rosselló signed into law on Monday the creation of a nonprofit entity initially dubbed Enterprise Puerto Rico, which will be in charge of promoting the island as a destination for foreign investment and new businesses.
“In Puerto Rico we have a host of assets that go beyond [tax] incentives. Enterprise Puerto Rico must promote these [assets],” said the governor, who reiterated that the island “is open for business,” and that the initiative is a “piece of the puzzle” that his administration currently implements to achieve economic development.
Caribbean Business asked why the government offered job creation estimates under this initiative, in contrast to such other measures as labor reform and amendments to the Public-Private Partnership Act.
Rosselló replied: “We compared the effects and similar structures in other jurisdictions, and then we did the estimates based on Puerto Rico’s population and workforce. We had viable data to do it and that is why we made the decision [to release estimates].”
He mentioned the states of Florida and Ohio, as well as Chile, as the lead case studies used by his administration in conceptualizing Enterprise Puerto Rico.
Rosselló added that the new structure would be operational before the end of the year, but only after it receives its initial funding—$500,000 from the Puerto Rico Industrial Development Co.— when the commonwealth’s next budget comes into effect July 1. Once the initial funds are disbursed, the amount of public funds to be allocated to Enterprise Puerto Rico would depend on the agreements signed between new businesses that establish on the island through the entity’s efforts.
Economic Development & Commerce Secretary (DDEC by its Spanish initials) Manuel Laboy noted that the legislation also provides for a mechanism the government matches the amount of funds brought by the private sector in a given project.
Moreover, Laboy said that the administration would have to wait for the entity to present its development, business and marketing plans, which would serve as the starting point to establish the amount of public funds the entity would need, while conceding that the newly signed law “doesn’t have a limit” over the level of public funding that can be allocated to Enterprise Puerto Rico.
As for DDEC’s private-sector promoters, the program would be integrated to the nonprofit entity, added Laboy, who assured that the Rosselló administration favors this initiative.
Meanwhile, the entity’s board of directors—which will comprise three government officials and eight members from the private sector, all named by the governor—would be named promptly, Rosselló said. Through an agreement between the nonprofit and DDEC, the latter will oversee the entity’s performance, including the effectiveness of funds granted to projects as a result of the initiative, both the governor and the economic development secretary explained.
For his part, Laboy emphasized that the government needs to reform the way Puerto Rico grants incentives, mostly in taxes, for economic development and assured that this would be addressed in the administration’s Puerto Rico Incentives Code, although it has yet to be presented.
“Our competitors are not only Singapore, Ireland and other countries in Europe or Central America; it is also the 50 states in the U.S.,” argued the official, who added that Puerto Rico shouldn’t “depend on [tax] incentives” and the code “will address that.”
The “evolution of the incentives system,” as detailed by Laboy, would be aimed toward supporting advanced manufacturing, agriculture, technology, exportation of services, the aeroespacial industry and the visitors’ economy.
The law-signing event took place in Santurce, at 210 Ponce de León Ave, at Parallel 18, a “global accelerator” of startups ascribed to the Science, Technology & Research Trust.
The new law calls for the establishment of a nonprofit entity that will be assisted by the DDEC, and could be named Enterprise Puerto Rico, although it leaves the door open for a different name, to be decided by DDEC secretary. Its tasks will include marketing Puerto Rico as a “pro-business jurisdiction” and attracting foreign investment to the island, aimed at establishing “new businesses,” as defined by the law.