Saturday, January 28, 2023

Puerto Rico: Debt restructuring effort fails

SAN JUAN ( Associated Press) – Efforts to restructure a Puerto Rican power company’s $9 billion in debt hit a new hurdle Thursday after several failed attempts to end its bankruptcy.

Officials had until Thursday to submit a new proposal to reduce the debt of the Puerto Rico Electric Power Authority (PREPA) – the largest by an island government agency – but a mediator team that oversees negotiations between bondholders and the government does, requests seven days. Expansion.

The federal judge overseeing the case has not yet ruled on the request. Resolving the power company’s debt is considered important to Puerto Rico’s economic development. The US region is still mired in economic decline and investors fear economic uncertainty and long-term power outages, partly blamed on crumbling infrastructure from decades of neglect and mismanagement.

Puerto Rico emerged months before the largest municipal bankruptcy in US history after announcing in 2015 that it could not pay its public debt of more than $70,000 million, the product of decades of corruption, mismanagement and requests for large loans. The power company is the only public body that has not restructured its debt. Many on the island fear the ongoing talks could lead to an increase in already high electricity tariffs to pay creditors.

In a document filed with the court on Thursday, the mediation team noted that a federal control board that oversees Puerto Rico’s finances and represents the island’s government in the bankruptcy lawsuit has data and analysis relevant to negotiating the loan. failed to present. electricity company.

The team said that without that information there was no way to move towards a resolution of consent.

The document states, “Put another way, good faith talks … require transparency on both sides.”

The board said in a statement sent to The Associated Press that it has cooperated and will continue to do so.

Nation World News Desk
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