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House Speaker-elect Méndez: The debt can be paid

By on November 18, 2016

Newly elected House Speaker Carlos "Johnny" Méndez

Newly elected House Speaker Carlos “Johnny” Méndez

SAN JUAN – The next Speaker of the House, Carlos “Johnny” Méndez, assured that Puerto Rico’s debt is payable and called into question that it amount to $72 billion, as alleged months ago by the administration of Gov. Alejandro García Padilla.

“The debt can be paid. I believe we have the ability to pay it. What’s going on is we have gotten used to the taste of champagne while only being able to afford ‘maví’ [tree bark-based beverage], and that’s what we have to learn, to make adjustments,” Méndez said in an interview Thursday with Caribbean Business.

Even though the government’s most recent fiscal projection estimates forewarn it will run out of cash to ensure its continued operations and meeting obligations in February, the House leader expressed doubt about the information provided by the current administration.

“I can’t trust a thing this administration says. This administration said we have $72 billion in debt. That’s not real. The government itself has certified that what’s really owed is about $24 billion,” he said.

When asked if those $24 billion referred only to central government debt, leaving aside the public corporations’ debts, the New Progressive Party (NPP) representative said, “The debts of the corporations aren’t part of the constitutional debt.”

“The corporations have the ability to pay with their assets, with the sales of…their services. What the central government has is a $24 billion debt that can be repaid if we refocus…government money where it should be used,” the legislator insisted.

The government of Puerto Rico says it has debt of about $70 billion. This includes bond issuances by the central government and public corporations. However, the number doesn’t include future, unfunded retirement system obligations, which would increase the debt by nearly $50 billion, according to information presented this week by the technical team of García Padilla’s government transition committee.

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