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Oversight board chairman: Economic development important, but fiscal matters need to be addressed first

By on February 9, 2017

SAN JUAN – Although the chairman of the fiscal control board, José Carrión, said the issue of economic development is of paramount importance to him, he admitted that back in Washington, D.C., he learned not to start conversations with this topic.

“I already learned not to lead with that topic. In my experience in Washington, what they want is for us to start with the fiscal issue, and then come back to talk about economic development and health [funds],” Carrión said Thursday during the 2017 Government Caucus event held by the Puerto Rico Manufacturers Association (Asociación de Industriales, or PRMA).

He added that all of the fiscal board’s members “would like the [Promesa] law to include more economic development elements.”

During a session entitled, “Perspectives of the fiscal oversight board on the debt of Puerto Rico,” the chairman reiterated the intention that the government solve the island’s fiscal situation. Although he assured that restructuring the debt is necessary, he said that alone is not enough and it continues to be up to the government to determine how to balance its budget for fiscal year 2019.

“What we want is for all of us to be honest, realistic and balanced. A solution, once and for all. To put an end to the false expectations of politicians in our country,” Carrión said.

He also used the occasion to congratulate the administration of Gov. Ricardo Rosselló for the reforms it has implemented so far because they aim at fostering economic development in Puerto Rico.

Regarding the fiscal plan to be delivered by the government at the end of the month, the chairman explained in general terms that the plan must demonstrate the island’s reality, ensure the allocation of resources for essential services and provide the necessary capital injection.

To questions about cuts to the debt, Carrión declined to comment on the issue because he believes it premature, and talks with creditors about reaching an agreement under Title VI of Promesa have barely begun. He added that the discussion will gain momentum once a fiscal plan has been certified.

As for the problems suppliers have with regard to being paid by the government, Carrión said it is not the board’s intention to intervene at that level and hopes that the government can take care of the matter as decision-making on public policy matters falls under its purview.

Meanwhile, the chairman stated once again that the solution should affect “essential services as little as possible,” that pensions be paid, “low-income” retirees be protected and that the the pensions of the police, teachers and firefighters be strengthened. It must also ensure investment in infrastructure and timely payment to suppliers and taxpayers.

He also warned that the government should anticipate the loss of federal funds, including those for healthcare. Until the availability of these funds is clear, the government cannot count on these as part of its fiscal plan, Carrión explained.

“The faster we start, the faster you’ll get rid of us,” the chairman said.

Fiscal oversight board Chairman José B. Carrión (Juan J. Rodríguez/CB)

Fiscal oversight board Chairman José B. Carrión (Juan J. Rodríguez/CB)

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