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Pence Promises Long-Term Help for Storm-Stricken Puerto Rico

Submitted by ckanon@abi.org on

Vice President Mike Pence pledged that the federal government will continue providing assistance to Puerto Rico until the hurricane-ravaged island has fully recovered, saying there is still “a long way to go,” Bloomberg News reported on Friday. “We will be here for the long haul. We will be here until all the people can say with one voice ‘Puerto Rico se levanta. Puerto Rico is rising’,” Pence said on Friday during a visit to Iglesia Santa Bernadita, a church in San Juan. Pence, traveling to Puerto Rico two days after President Donald Trump visited with hurricane survivors and federal relief personnel, praised the government effort to provide food and resources to residents. Pence also said he “had faith” in Puerto Rico’s governor and local leaders. Trump criticized the mayor of San Juan after she complained of inefficiency in the federal response. The federal board overseeing Puerto Rico’s troubled finances has cited estimates that the massive rebuilding effort needed could cost as much as $95 billion, roughly 150 percent of the island’s economy.

In related news, Puerto Rico bond insurer Assured Guaranty Ltd. said on Friday that it voluntarily withdrew a complaint that challenged the legality of the island’s fiscal turnaround plan, citing the devastating impact of Hurricane Maria, Reuters reported. The move may temporarily ease Puerto Rico’s financial problems as it struggles to get back on its feet after Maria hit last month, destroying the electrical grid and leaving most of the island’s 3.4 million inhabitants without power. Assured Guaranty, along with a second insurer MBIA Inc., filed its lawsuit against the island’s government and a federally appointed financial oversight board on May 3, a day after Puerto Rico announced a historic restructuring of its public debt. Read more.
 
Additionally, Puerto Rico bondholders should only expect to recover 10 to 20 cents on the dollar when the island emerges from its record-setting bankruptcy, in line with recoveries seen when sovereign nations default, according to Kyle Bass, managing partner of Hayman Capital Management, Bloomberg News reported on Friday. "Puerto Rico is just a simple math 101 question," Bass said in a Bloomberg Television interview Friday. "You have to be a little crazy to think that $100 billion worth of debt or even $70 billion of on-balance sheet debt is worth anything with 1.4 million workers and an economy like Puerto Rico’s." Puerto Rico bonds tumbled to record lows this week after President Donald Trump suggested the island’s $74 billion debt load should be wiped out in the aftermath of Hurricane Maria. The bonds recovered slightly after White House officials clarified the president’s statements. Read more.
 
For updated news and analysis of Puerto Rico's debt crisis, along with current docket filings in Puerto Rico's case, be sure to visit ABI's "Puerto Rico in Distress" webpage.