Reuters
Published Jan 14, 2020 06:41PM ET
Earthquakes to impede Puerto Rico's economic recovery: Moody's
(Reuters) - A series of earthquakes that recently hit Puerto Rico poses a setback for the bankrupt U.S. territory in terms of its economic recovery and ability to retain residents and businesses, Moody's Investors Service said on Tuesday.
The quakes included one with a magnitude of 6.4 on Jan. 7, the Caribbean island's most powerful earthquake in 102 years. Governor Wanda Vazquez estimated damages at $110 million and has requested a major disaster declaration from President Donald Trump.
Moody's said the earthquakes highlight "significant environmental risks" facing Puerto Rico, which has been in federal court since 2017 attempting to restructure about $120 billion of debt and pension obligation through a form of municipal bankruptcy.
"Damage from the quakes is likely to blunt a recent trend of positive economic activity and increase the risk of more residents and corporations looking to relocate," the credit rating agency said in a report.
The positive trend includes growth in population, employment and real economic output last year, according to the report.
An increase in the types and frequency of natural disasters on the island could make it harder to attract or expand operations by corporations, Moody's said. Compounding that problem is an expected phasing out by the U.S. Treasury of a business tax credit for American corporations based there, it added.
Puerto Rico is still struggling to recover from devastating hurricanes in 2017 and Moody's noted the island has received only a fraction of the federal funding allocated in the wake of that disaster.
Written By: Reuters
Trading in financial instruments and/or cryptocurrencies involves high risks including the risk of losing some, or all, of your investment amount, and may not be suitable for all investors. Prices of cryptocurrencies are extremely volatile and may be affected by external factors such as financial, regulatory or political events. Trading on margin increases the financial risks.
Before deciding to trade in financial instrument or cryptocurrencies you should be fully informed of the risks and costs associated with trading the financial markets, carefully consider your investment objectives, level of experience, and risk appetite, and seek professional advice where needed.
Fusion Media would like to remind you that the data contained in this website is not necessarily real-time nor accurate. The data and prices on the website are not necessarily provided by any market or exchange, but may be provided by market makers, and so prices may not be accurate and may differ from the actual price at any given market, meaning prices are indicative and not appropriate for trading purposes. Fusion Media and any provider of the data contained in this website will not accept liability for any loss or damage as a result of your trading, or your reliance on the information contained within this website.
It is prohibited to use, store, reproduce, display, modify, transmit or distribute the data contained in this website without the explicit prior written permission of Fusion Media and/or the data provider. All intellectual property rights are reserved by the providers and/or the exchange providing the data contained in this website.
Fusion Media may be compensated by the advertisers that appear on the website, based on your interaction with the advertisements or advertisers.