Updated 07:41 AM EST, Tue, Mar 02, 2021

US Senate to Help Puerto Rico on Debt-Restructuring

  • +
  • -
  • Sign up to receive the lastest news from LATINONE

Democrats in the US Senate have expressed their plan to help Puerto Rico with its current crisis through congressional action, which will restructure the country's debts.

Reuters reported said the 46 Democrats and independents penned a letter to the Republican leader of the Senate, Mitch McConnell, and asked him to take action regarding the economic situation of the US territory.

"Restructuring legislation would not cost the federal government a single penny and would instead save U.S. taxpayers from the growing cost of inaction," the letter read.

It was noted that the correspondence was meant to challenge the Republicans who are not in favor of allowing the US to restructure debt.

There have been previous bills which only bring the country's finances "under federal oversight," but does not include the restructuring of debt.

"Puerto Rico was included in Chapter 9 of the U.S. Bankruptcy Code until 1984, when Congress inexplicably excluded it from the nationwide approach to resolving municipal insolvency," the letter furthered.

The country has run out of cash because of its $70 billion debt with the US Congress.

According to Huffington Post, the Senate has not yet made a decision if it will consider the legislation or not.

Because of this, Democrats are strongly pushing for this solution, even warning Congress that if there will be no restructuring efforts from them, fiscal crisis will worsen in the country and more Puerto Ricans will move to the United States.

The same report highlighted that about 84,000 people left the country and migrated to the US mainland --most of them are now living in Florida. This number is said to be 38 percent higher than the statistics in 2010.

"Without congressional action, Puerto Rico will face a long and difficult recovery that could have harmful consequences," said Treasury Secretary Jacob J. Lew in a Bloomberg report.

He added that passing the legislation would mean helping 3.5 million American residents in the country.

Governor Alejandro Garcia Padilla asked Congress earlier to craft a "formal debt-restructuring process" for the country to help it and its residents recover from their financial losses.

The U.S. offered two options for Puerto Rico to recover. CNN Money said the first option was to offer the country "cash, tax cuts and oversight but no legal power." The second one had no monetary offering, but would give the country the legal power for it to be able to restructure some of its debts.

© 2015 Latin One. All rights reserved. Do not reproduce without permission.
  • Sign up to receive the lastest news from LATINONE


Real Time Analytics