Puerto Rico can crawl out of its $72 billion debt hole without defaulting on its government debt, says a report commissioned by holders of $5.2 billion of the U.S. commonwealth's government-backed bonds, Reuters reported yesterday. By cutting expenses, including on education, and improving tax collection, Puerto Rico could erase its deficit by 2017, according to a report by Jose Fajgenbaum, Jorge Guzman and Claudio Loser, former International Monetary Fund economists and now consultants at Centennial Group. Puerto Rico Gov. Alejandro Garcia Padilla's office criticized the report on Sunday. The governor's chief of staff, Victor Suarez, responded in a statement that the island has "already enacted significant fiscal reforms," including pension concessions. Centennial was retained by a group of holders of general obligation Puerto Rican bonds, including Fir Tree Partners, Brigade Capital Management and Monarch Capital Group.
