FAJARDO, Puerto Rico – Dozens of Puerto Ricans clashed with police on Friday while protesting a federal control board that was meeting for the first time in the U.S. territory after taking control of the island’s finances.
About 500 police officers were deployed in anticipation of protests outside the meeting at a swanky resort in the northeast city of Fajardo, a one-hour drive from the capital of San Juan. But the protest in Fajardo was small and peaceful, while a clash came in San Juan, where demonstrators pushed into the board president’s office floor as they clutched Puerto Rican flags made in black and white to signify mourning and called the board a “dictatorship.”
The nearly six-hour meeting in Fajardo was closed to the public, unlike the previous two other meetings in New York. Board members warned they will have to make very hard decisions in upcoming months as the island struggles to overcome a decade-long economic crisis and pushes to restructure nearly $70 billion in public debt.
“The current situation is unsustainable for all stakeholders,” said Carlos Garcia, one of the seven board members. “We have a once-in-a-lifetime opportunity to rebuild this.”
Friday’s meeting focused mostly on a 10-year fiscal plan that Puerto Rico Gov. Alejandro Garcia Padilla submitted last month as he warned of a $58 billion financing gap in the next decade. Critics who testified during the meeting said the fiscal plan was weak, incomplete and does not allow for negotiations with creditors hit with multimillion-dollar defaults.
Among the more outspoken people opposed to Puerto Rico not paying its debt was Jorge Irizarry, executive director of a local group representing Puerto Rico bondholders.
He said creditors are ready to work with Puerto Rico officials and his group would accept the government not paying principal for the next five years.
“All creditors are willing to make concessions,” he said. “Puerto Rico can work its way out of this.”
Puerto Rico has defaulted on nearly $1.4 billion worth of bond payments since August 2015, and the government warned this week that it will run out of money by February if a debt moratorium that expires that month is not extended.
Irizarry, however, told the board that the moratorium should be repealed to help move negotiations with creditors forward.
Board President Jose Carrion III said members will approve a fiscal plan by Jan. 31, but stressed that the proposed plan needs to be revised, in part because it assumes a lot of federal help.
“What troubles me the most about the plan is that I view it as a missed opportunity,” he said. “Puerto Rico is likely not to receive everything that this government is asking for. One needs to be realistic when planning and budgeting.”