Friday, December 14, 2018

Puerto Rico Planning Board: Hurricane Maria had an economic impact of $43 billion

By on December 5, 2018

San Juan’s cruiseship and cargo ports are nearly empty on on Sept. 24, 2017, days after Hurricane María struck. (CB photo)

SAN JUAN – The estimated net impact of Hurricane Maria on Puerto Rico’s economy was $43.1 billion as of Oct. 12, 2018, an amount that includes the impact to the public and private sectors.

The information was provided by the Puerto Rico Planning Board, which used data gathered from a survey of public and private officials on the damages, expenditures, revenue losses, public assistance and insurance claims.

Officials also used data from other sources including the Federal Emergency Management Agency (FEMA), the Insurance Commissioner’s Office and private insurers. Using the information, the Planning Board conducted an analysis by sector to be able to do a representation of the effect of the hurricane on the economy.

The numbers, which are about $1 billion more than originally estimated, come 14 months after hurricanes Irma and Maria struck the island. In a separate report, the governor estimated the island needed more than $120 billion to rebuild its infrastructure and economy.

The impact of the Hurricane in the public sector with the available data was estimated at $6.1 billion as of July 2. The number took into account damage to infrastructure ($4.61 billion), expenses ($1.78 billion) and reported income losses ($2.09 billion) minus the funds allocated by FEMA or disbursed by insurers ($2.38 billion).

The net impact to municipalities was $299.2 million as of July 2. The amount includes damage to infrastructure ($293.8 million), expenses ($234 million) and reported income loss ($34.3 million) but subtracted funds allocated by FEMA, disbursed by insurers and Community Development Block Grant – Disaster Recovery (CDBG – DR) Program funds in the amount of $263 million. The most affected towns were Aguadilla, Caguas, Humacao, Mayagüez, Ponce and San Juan.

The Planning Board pegged the impact to the private sector at $38.6 billion. To arrive at that number, officials reviewed components such as agriculture, mining and construction, manufacturing, services, commerce and residential.

After taking FEMA and private insurer disbursements into account, or $8.29 billion, the net impact to the economy was $30.3 billion.

According to Department of Agriculture data, from eight regional reports, the damage was estimated at $2.01 billion. The Insurance Commissioner’s report, meanwhile, revealed that infrastructure and equipment damage in the commercial sector totaled $3.6 billion. This figure was broken down into $3.58 billion in damages to commercial properties and $21.2 million in commercial cars. The loss of income due to business interruption and other causes was $862.4 million.

In the construction and mining, manufacturing, and services sectors, the impact was estimated at $29.7 billion. The number was estimated from the loss in revenue using sales reports of each sector. These estimates were also made by making assumptions from Electric Power Authority reports on the percentage of clients with service as well as assumptions that incorporated employment compensation.

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