Gubernatorial Candidates React to Governor’s Debt Moratorium Order
SAN JUAN – New Progressive Party (NPP) gubernatorial hopeful Ricardo Rosselló said the administration of Alejandro García Padilla “has destroyed the good name of our people” when announcing a moratorium on Government Development Bank’s (GDB) debt service, setting the stage for a partial default on the roughly $440 million in debt payments that hit Monday, May 2.
“If anything, Puerto Ricans have always been proud of keeping their word and their good name. We have distinguished ourselves for our credibility and commitment for decades, until this García Padilla-Bernier administration came,” Rosselló said in reaction to the governor’s televised speech Sunday.
“The consequences of this action will be felt by future generations, which this government limits more and more, by leaps and bounds,” he added.
NPP president and gubernatorial hopeful Pedro Pierluisi called the decision “irresponsible and reckless.”
“The default announced by García Padilla unfortunately will make our economic and fiscal recovery even more difficult.
“No, Mr. Governor, when you took on the responsibility of governing Puerto Rico, our credit was not junk, Puerto Rico was not bankrupt and had never stopped paying its obligations. For that, the responsible ones are you and your administration,” Pierluisi stated.
The also resident commissioner insisted that “the only way to responsibly address the issue of the public debt and the economic and fiscal crisis we are in is through a restructuring mechanism that allows for consensual negotiations, in good faith, and that allows the agreements to be complied with.”
Meanwhile, Popular Democratic Party gubernatorial candidate David Bernier also issued a statement after the governor’s message.
“The urgency of the moment makes action from the branches of the federal government unpostponable. There is no room for excuses or subterfuge to continue hiding an increasingly apparent disregard for the urgent need for Puerto Rico to be provided with the mechanisms to restructure its debt without being forced to hand over its powers of self-government. My call is to demand, with a clear and strong voice, action by Congress now, and even more so, from the federal executive [branch], to not use the misfortune of Puerto Rico as a political pawn any longer,” Bernier stated.
Puerto Rico Independence Party (PIP) gubernatorial candidate Sen. María de Lourdes Santiago said the late call by García Padilla “in a pitiful begging tone, confirms that the right strategy in terms of public debt is an outright declaration of default, as I have proposed since December of last year. Only the default, as a political strategy of confrontation, will lead creditors to negotiate a debt restructuring that alters principal, interest and due dates.”
She urged the governor to endorse PIP’s proposal and formally declare a default, begin an orderly debt-restructuring negotiation and call for a decolonization process “that leads us to overcome the political inferiority of the commonwealth.”
For Bernier, “the reality of default and, even more, the maturity of general obligation payments, among others, the July 1 [payment] forces the parties to redouble their efforts to reach an agreement that will allow Puerto Rico to meet its obligations without causing a social fracture or impacting essential services to citizens.”
For his part, Rosselló believes García Padilla’s decision goes against the the Constitution of Puerto Rico and “will cost millions in additional dollars in unnecessary litigation.”