Puerto Rico Economic Development Dept. holds Single Business Portal seminars

Offers guidance on permits and licenses

SAN JUAN — Puerto Rico Economic Development Secretary Manuel Laboy Rivera announced Wednesday that his department’s Permits & Endorsements Management Office (OGPe by its Spanish acronym) will hold workshops at several organizations aimed at providing guidance on the new permits that will be managed through the Single Business Portal (SBP), which was created to unify processes and expedite the granting of licenses, certifications and permits, among other procedures.

Laboy said workshops will be offered “on the new products that will be integrated into the SBP as of June 7: Construction Permit, Operational Incidental Only Permit, Single Permit, and licenses for opening and operating businesses. These processes that have been entered in the Single Business Portal are part of the changes stipulated by the Permits Reform of Governor Ricardo Rosselló Nevares, who created a Unified Computer Information System where project proponents can request permits, in order to eliminate bureaucracy, measure effectiveness and give transparency to the processes,” Laboy said in a statement.

The first seminar was conducted by the Builders Association on Wednesday. The second, to be given by the Planning Board, will address the autonomous municipalities and will take place Thursday, May 30. The third will be held at the Architects and Landscape Architects Association on June 4, from 9 a.m. to noon. The fourth will be held by OGPe on June 5, at the Engineers & Land Surveyors Association (CIAPR by its Spanish initials) from 6 p.m. to 9 p.m.

For more information, call 787-721-8282, extension 16356.

[EDITORIAL] Up By The Bootstraps—Again

Editor’s note: This editorial was originally published in the June 21-27 issue of Caribbean Business

There was some good news on the jobs front for Puerto Rico—perhaps light at the end of the tunnel that is not a freight train barreling toward us—in an announcement by Sartorius, a German firm that manufactures pharmaceutical and laboratory equipment, would be moving forward with an expansion of its operation in Yauco. That $130 million investment will create 300 jobs.

Importantly, the German firm’s expansion is the result of work begun under a previous administration—Gov. Alejandro García Padilla and Economic Development & Commerce Department (DDEC) Executive Director Alberto Bacó Bagué—concluded under the administration of Gov. Ricardo Rosselló and DDEC Executive Director Manuel Laboy.

Thus, the German firm’s decision to invest in Puerto Rico is the result of a bipartisan initiative, an example of the art of the possible when opposing parties—in this case, the pro-Commonwealth Popular Democratic Party and the Pro-Statehood New Progressive Party—work together for the good of Puerto Rico.

The result of that expansion—job creation—conjured important infrastructure work, the Teodoro Moscoso Bridge, which commenced construction under the administration of Gov. Hernández Colón (1989-1992) but was inaugurated during the first term of Gov. Pedro Rosselló in 1994.

When the time came to cut the ribbon prior to the bridge’s first fare, then-Gov. Rosselló invited Hernández Colón to participate in the inaugural ceremony. That is the sort of statecraft that celebrates progress and leads to the creation of jobs. “Just because he has a different ideology doesn’t mean we should not cooperate; he started that project and it was right for him to be there,” Rosselló told this journalist in an interview that took place nearly a decade after that momentous occasion.

We must recapture bipartisan initiatives as Puerto Rico muddles toward frugality in this new abnormal. Sadly, there is very little of that spirit on display in the middle of this latest perfect storm spun by a mammoth debt crisis and a natural disaster the likes of which Puerto Rico has not experienced in nearly a century. Instead, we have disaster capitalists—some feeding on funds for recovery, others feeding on the costly process of debt restructuring—hovering above.

During an exclusive interview with this newspaper, U.S. House Natural Resources Committee Chairman Rob Bishop (R-Utah) said it would be a good idea for Puerto Rico to put fed funds coming to the island to work in this economy. He has expressed the same concern about the legal fees—overblown billable hours—being spent on financial advisers working their “restructuring magic” under the Puerto Rico Oversight, Management & Economic Stability Act. Bishop believes it is a good idea if that money goes to local firms to help kick-start an economy that is aching for a jolt to commence a path to sustainable growth.

Bishop stressed the need for the private sector and entities from the nonprofit realm to cooperate in pulling Puerto Rico up by the bootstraps once again. In other words, don’t count on the government and don’t count on the U.S. Congress.

There is no cavalry coming to save this economy. Yes, there is a trailer full of fed funds coming down the pike. A huge windfall is expected for Puerto Rico’s economy, commencing in the last quarter of 2018, tied to two separate grants by the U.S. Department of Housing & Urban Development (HUD) totaling $20 billion. The first assignment coming down the pike is a $1.5 billion Disaster Recovery (DR) grant announced in February that will start to trickle into the local economy in September. The local Housing Department has already filed a plan with HUD laying out the specific use of those federal funds, which are likely to be used to rebuild homes, assist businesses and help repair critical infrastructure. Another $18.5 billion in grants have been earmarked by HUD through the Community Development Block Grant (CDBG) program.

How much of that is put to good use with local talent will be very important for maximizing this economy’s growth. Attract capital to remain here (see Top Story, p. 4) and create jobs, lest we find ourselves in the same spot long after we have blown through the disaster fund windfall.

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Copan Industries to set up Puerto Rico operation with $13 million investment

SAN JUAN — Italian health and biotech company Copan Industries Inc. will establish a facility in Puerto Rico through a $13 million investment and committed to creating up to 100 new jobs, Gov. Ricardo Rosselló announced Thursday.

Among the new jobs are supervisors, engineers, scientists, and administrative, warehouse and operational personnel who would be dedicated to manufacturing medical devices. Specifically, Copan Italia is dedicated to standardized universal specimen collection and preservation systems for bacteriology, virology, molecular biology, forensic and environmental sampling.

“Companies like Copan Industries prove that investing on our island is worth it. We continue on the path toward economic recovery. Our thanks to Copan for believing in Puerto Rico and creating new, specialized jobs,” the governor said.

The Italian biotech and health company will create up to 100 new jobs. (Courtesy photo)

Meanwhile, Copan CEO Stefania Triva said that “our company, hand in hand with Puerto Rican professionals, has identified the potential represented by Puerto Rico’s regulated infrastructure, its knowledgeable workforce, and its diversity of cutting-edge professionals who, along with a government system that promotes economic development, makes it the ideal place to reach our next step of business development.”

“Our goal is to take our high-technology and high-quality products to be used worldwide and Puerto Rico becomes the ideal platform to achieve it,” Triva said.

Economic Development Secretary Manuel Laboy stated that he is “pleased that Copan Italia has placed its trust in our working force, which so needs specialized and well-paid job opportunities to stop its exit from Puerto Rico.”

Founded in 1979 by Giorgio Triva as a small, family-owned distributor of disposable plastic lab components, was quickly grown globally with Daniele Triva with improvements in product design and manufacturing. With a reputation for innovation in preanalytics, it is a leading supplier of collection and transport systems.

The company patented FLOQSwabs, eSwab, and UTM Viral Transport to improve microbiology assays.

Copan Group is composed of the following six companies: COPAN Italia, COPAN Flock Technologies, COPAN NewLab Engineering, COPAN Diagnostics Inc., COPAN Wasp and COPAN Innovation Shanghai Limited.

Gov’t official assures San Juan port congestion being addressed

SAN JUAN — Puerto Rico Economic Development Secretary Manuel Laboy confirmed Monday that his department is looking into the number of shipping containers with merchandise that continue accumulating in the Port of San Juan, which are also causing traffic on Kennedy Avenue and pickup delays.

“I have had conversations with MIDA [Spanish acronym for Chamber of Food Marketing, Industry & Distribution], with the Retail Trade Association, with the United Retailers Center, with the Chamber of Commerce itself. It’s a topic that has arisen, especially after the hurricanes. It’s one of the core issues. Yes, I’ve been in conversations in which those concerns have been brought. I am a member of the Board of Directors of the Ports Authority and it is something I have been able to share. It is being worked on,” Laboy said in a Radio Isla 1320 interview.

He also announced that there are scheduled meetings in which the matter will be discussed.

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“There is concern and I believe that in many instances there are concerns that are merited and I think they deserve to be taken care of responsibly,” he added.

Since the passage of hurricanes Irma and María, the cargo container delivery has been affected, causing traffic congestion on Kennedy Avenue, at the entrance to the port area. Which in turn complicates the process and waiting time for truck drivers to pick up the containers.

“I cannot indicate specific situations because that is part of what has to be evaluated. But I can tell you that there is a concern in the food distribution sector,” the official maintained, unable to explain the reasons for the problem.

Meanwhile, the spokesperson for the Broad Teamsters Front, Víctor Rodríguez, blamed the Federal Emergency Management Agency (FEMA).

“This is caused by non-planning and the fact that the government does not [tackle] the problem. The problem is simple. Everyone knows it. FEMA made agreements with some shipping companies and [now] they have this kind of problem when there are more than 1,000 containers stuck at the docks of Puerto Rico, especially in the Kennedy [Avenue] area. That’s why the traffic is immense,” Rodríguez said in an interview with the same radio station.

He argued that during normal times, it can take truckers about an hour and a half to collect merchandise, but that it is currently taking up to 10 hours.

“Why? Because the hoarding of containers by FEMA and with the conspiracy of some companies has caused this type of problem that is not needed by the people of Puerto Rico,” he denounced.

Honeywell Aerospace expands Puerto Rico operations

SAN JUAN — Puerto Rico Gov. Ricardo Rosselló announced Thursday that Honeywell Aerospace will expand its testing capabilities at its research and technology facilities in Moca, Puerto Rico.

As a result of the expansion, 50 people will be hired for engineering and technology positions, as well as other support areas. Honeywell Aerospace Puerto Rico has two facilities, in the municipalities of Aguadilla and Moca, and employs more than 850 professionals.

The governor emphasized that the expansion will attract new businesses in addition to creating jobs. (Courtesy photo)

“With a $2 million investment, Honeywell Aerospace will expand the capacity of its installations and its workforce in Moca, which will help bring new businesses to Puerto Rico and result in new jobs in addition to the ones announced today,” the governor said.

The Aguadilla Service Center provides support to Honeywell’s operations and clients around the world. Meanwhile, the Moca facility is a cutting-edge engineering design center and laboratory used to carry out research and development work in the field of electromagnetic interference and compatibility.

Honeywell Aerospace products and services are used by numerous commercial, defense and space aircraft, and its turbochargers are used by nearly every automaker and truck manufacturer.

According to the company, its aerospace business unit develops solutions for “more fuel-efficient automobiles and airplanes, more direct and on-time flights, safer flying and runway traffic, along with aircraft engines, cockpit and cabin electronics, wireless connectivity services, logistics, and more.”

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The announcement came about following a collaboration between Economic Development Secretary Manuel Laboy and Luis Ramos, the director of engineering for Honeywell Aerospace Puerto Rico and Puerto Rico Research & Technology Center (PRR&TC) site leader.

Rosselló added that “the service expansion of a world-renowned company such as this one proves that Puerto Rico is open for business. This government continues to fulfill its programmatic commitments focused on the development of technology and innovation, as well as job creation.”

Meanwhile, Laboy said that “the governor, as well as the Economic Development & Commerce Department, are committed to continuing to strengthen the economy by through the creation of professional jobs in businesses with great potential for expansion.”

For his part, Director Ramos said that “with today’s announcement, Honeywell Aerospace Puerto Rico reaffirms its commitment to the growth of its test engineering capabilities here on the island.”

“This announcement, together with the inauguration of an electromagnetic interference test chamber at the Polytechnic University of Puerto Rico and the donation of safety equipment during the Hurricane Maria recovery efforts, reaffirms Honeywell’s commitment to our employees, the communities where we live and work, and the continuous development of the best aerospace products for our global aviation customers,” Ramos added.

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Survey: Economists disapprove of administration’s economic development efforts

SAN JUAN — A second survey by the Puerto Rico Economists Association (AEPR by its Spanish acronym) reflected a tendency in its membership to disapprove of the Gov. Ricardo Rosselló administration’s economic development efforts.

The survey was carried out by the association to learn of its members’ position regarding the proposals and economic arguments pushed by the government.

The survey revealed consensus regarding multiple public policy proposals, such as 84 percent of the economists do not believe that economic growth for 2019 will be 8.4 percent, as suggested by the fiscal plan.

Likewise, 72 percent of the members do not believe that the privatization of the Puerto Rico Electric Power Authority (Prepa) will benefit the island’s economic development.

Also, 81 percent of the economists are against eliminating $423 million in subsidies to the University of Puerto Rico, while 62 percent believe the privatization of PR-22 was not beneficial for economic development.

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In addition, 77 percent of economists favor a moratorium on the debt’s payment for five years; 72 percent favor a greater than 60 percent reduction of the debt’s principal—as proposed by economists Martin Guzman, Joseph Stiglitz, and Pablo Gluzmann—and 81 percent said incentives and subsidies to companies that are not creating jobs should be eliminated.

In general, more than 81 percent believe that the island’s fiscal oversight board and the government are poorly advised in financial matters.

“The perception that economists do not agree on anything is incorrect. On the contrary, on many of the issues there is a consensus among most economists, many of whom are never consulted or given serious consideration. That is an integral part of the current crisis,” AEPR President José Caraballo said.

With respect to the compilation and preparation of statistics, 93 percent of respondents consider the financial and human resources allocated to prepare statistics in Puerto Rico are insufficient; 83 percent disagree with the integration of the Puerto Rico Statistics Institute (PRSI) to the Economic Development & Commerce Department; and 90 percent is against the entity’s privatization.

“There is consensus that instead of eliminating the SI, the government’s policy should be aimed at strengthening it. If the collection of statistics is not strengthened, we will continue to have uncertain credibility before the markets and the island in general because it is a necessary transparency measure. In addition, having reliable data generates healthy public policies anchored in reality,” AEPR Vice President Alba Brugueras said.

The survey also found consensus in proposals that have not been seriously considered.

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Among these, 67 percent of the economists support a tax increase on  luxury goods and services; 87 percent said they were against trickle-down economics, the theory that growth among the largest businesses will eventually benefit the entire economy. Also, 75 percent believe that the creation of work cooperatives and incentives for agriculture, and agri-ecotourism are important.

However, there was little consensus on whether the privatization of the Luis Muñoz Marín International Airport and PR-22 were beneficial or on the importance a second labor reform.

The AEPR indicated that the survey was conducted among 69 affiliated economists, which it stressed is a relatively high sample based on its number of members.

The entity’s spokespeople clarified that the survey did not receive any financial or institutional support from any other organization, and added that they will continue to hold conferences and events in the coming months that will be available to their members and the public.

Changes to Puerto Rico Economic Development Dept. reorganization plan announced

SAN JUAN – Gov. Ricardo Rosselló, along with Puerto Rico House of Representatives Speaker Carlos “Johnny” Méndez, announced the withdrawal of the Reorganization Plan of the Department of Economic Development and Commerce (DDEC by its Spanish acronym) and the introduction of a new version of the measure.

“These new changes strengthen the bill so we have decided to withdraw the original Reorganization Plan and submit a modified one to receive input from the Legislative Assembly and [include] what my Administration discussed with the tourism sector,” the governor said in release issued by his office, La Fortaleza.

The changes include keeping the games of chance and room tax with the Tourism Office and not transferring them to the Treasury Department; having a separate management structure for the Tourism Office–with its own secretary–in the new consolidated structure; and creating a pro bono advisory council to help the head of the Tourism Office make the currently running industry programs more efficient.

“Consideration of these reorganization plans are a priority for the Legislative Assembly because they make it possible to fulfill the promise of giving [the people] a more efficient and less expensive government. We will continue communicating with the governor to make the necessary adjustments to these plans to ensure the best possible operation of the Government,” the House speaker added in the release.

La Fortaleza had announced this week agreements with several tourism industry sectors and the House speaker had indicated that a modified reorganization plan would be needed to adopt them.

The reorganization measure would put in effect the integration of nine agencies and public corporations associated with economic development within the DDEC.

The introduced bill integrates as part of DDEC’s structure the Industrial Tax Exemption Office, the State Energy Public Policy Office, the Government Regional Center Corp. and the Permit Management Office.

While the Trade and Export Co., the Tourism Co., the Puerto Rico Industrial Development Co. (Pridco), the Roosevelt Roads Redevelopment Authority, and the Planning Board are attached to its structure.

In addition, the proposed consolidation plan orders the outsourcing of the Statistics Institute “to give it independence.”

According to the government, the reorganization plan will achieve savings of $7.8 million in the first year and nearly $100 million in the first five years.

“With the new changes, the House of Representatives will be in a position to pass the DDEC Reorganization Plan,” said in the release.

Amendments to Puerto Rico Economic Development Dept.’s consolidation sent to Legislature

SAN JUAN – The secretary of Public Affairs & Public Policy, Ramón Rosario Cortés, informed that the executive branch submitted to the Legislative Assembly amendments to the bill that makes it possible to consolidate the Economic Development & Commerce Department (DDEC by its Spanish acronym) with a view toward strengthening tourism on the island.

The spokesman for La Fortaleza explained that “the changes submitted to the Legislative Assembly, together with the tourism industry, are to maintain the functions of gambling and the room tax in the new consolidated structure and not to transfer them to the Treasury Department; and keep the Tourism Office in the new consolidated structure, but with a secretary who will respond to the head of DDEC.”

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In addition, he explained that “a pro bono advisory council will be created to help the head of the Tourism Office make the industry’s current programs more efficient.”
This consolidation integrates the structures of nine agencies or public corporations associated with economic development.

Rosario Cortés informed that these changes maintain the principles of DDEC’s Reorganization Plan and are compatible with its purpose to integrate several governmental entities to achieve efficiencies, and better services and results.

The measure integrates into DDEC’s structure the Industrial Tax Exemption Office, State Energy Public Policy Office, Government Regional Center Corp. and Permit Management Office.

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Meanwhile, the Trade & Export Co., Tourism Co., P.R. Industrial Development Co. (Pridco), Roosevelt Roads Redevelopment Authority and Planning Board are also attached to its structure.

The proposed Consolidation Plan also orders the outsource of the Statistics Institute to provide it with independence. According to the Government, this Reorganization Plan will achieve savings of $7.8 million in the first year and nearly $100 million in savings during its first five years.

“As is the policy of the Rosselló Nevares administration, we are always willing to listen and improve government proposals. We have agreed to submit to the Legislative Assembly some clarifications and modifications to the bill,” Rosario Cortés said.

He also added that “this was discussed with the Hotel & Tourism Association and other sector stakeholders regarding the Tourism Co.’s integration with DDEC. The changes do not alter the purposes of DDEC’s Reorganization Plan, thus the amendments to the proposed bill will allow for the changes agreed to with the industry.”

Gov’t says ready to help Toys ‘R’ Us workers amid Puerto Rico closures

SAN JUAN — After receiving notification of final closure of the Toys ‘R’ Us stores in Hatillo and Carolina, and the subsequent dismissal of 84 employees, the Labor Development Program of Puerto Rico’s Economic Development & Commerce Department (DDEC by its Spanish acronym) activated services for the dismissed workers, DDEC Secretary Manuel Laboy informed Friday.

The DDEC State Unit for Displaced Employees & Employers will offer its services to the former employees of the Hatillo store from 9 a.m. to 3 p.m., Wednesday, Feb. 7, at the Centro de Gestión Única, in front of Arecibo’s Public Plaza. Meanwhile, the now-former employees of the Carolina store can receive services on Friday, Feb. 9, at the municipality’s Labor Department.

“Both in Carolina and Arecibo we will be educating the displaced employees on the government aid to which they are entitled. Among the programs available are Insurance for Unemployment, [the Nutritional Assistance Program] PAN and Mi Salud [government health insurance]. They will also offer résumé writing service, interview techniques, transition management and other support,” explained Natasha Vazqueztell, director of the Labor Development Program.

The Quick Response team from the Displaced Workers Unit was activated to assist the workers, who received their final payment Thursday, Feb. 1.

As explained to the DDEC, the closure of both stores responds to a national reorganization and restructuring plan. Neither of them reopened after Hurricane Maria passed in September

Moreover, Labor & Human Resources Secretary Carlos Saavedra said all resources will be activated so, through the DDEC’s Labor Development Program, employees can access the aforementioned services and receive aid with job search.

“The transition of these employees toward finding another job is one of our priorities,” Saavedra said.


Business Briefcase for Women: A new management training platform

SAN JUAN — With the goal of providing women entrepreneurs better tools to do their work, the Puerto Rico House Women’s Affairs Committee, chaired by Rep. Lourdes Ramos, began the study of a measure that would develop a training platform for women in business.

House Bill 1202, authored by Ramos, establishes the “Business Briefcase for Women,” attached to the Economic Development & Commerce Department (DDEC by its Spanish acronym), to provide tools to foster potential women entrepreneurs to open a business of their own. In addition, the legislation would establish that DDEC has the task of providing an integrated concept for this effort, with the tools that guide women during the process of creating their own company.

Rep. Lourdes Ramos (Courtesy photo)

“With this program, we will be able to train future businesswomen to prepare their own business plan, develop it and have it approved. This way, women will be more empowered,” Ramos said in the announcing release.

Attorney Aimee M. Rendón appeared at the public hearing to support the legislation for its potential contribution to Puerto Rican women. “As part of the program, DDEC will offer individualized mentoring. It would take the businesswoman by the hand–during the process of forming her company, starting from her business idea to its creation and expansion, with a view toward exporting services.”

In response to questions from the committee chairwoman about whether DDEC has funding for the program, the department said it has a range of financial incentives and federal funds for training and company formation.

At the conclusion of the hearing, Rep. Ramos expressed her satisfaction with the measure and her hope that it be signed during Women’s Week. “I am fascinated by the bill because, in addition to the incentive to open your business, it provides knowledge and self-management for what’s going to become yours.”

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