Economists Say Puerto Rico Needs Right to Bankruptcy Option

Northwest Arkansas

By Danica Coto 

SAN JUAN, Puerto Rico — Puerto Rico's financial future hung in limbo Tuesday as economists and officials warned that the U.S. territory could head down Greece's path if it is not allowed to declare bankruptcy as it struggles with $72 billion in public debt.

The island prepared to close a troubled fiscal year amid intense investor scrutiny just hours before the first of several multimillion-dollar debt payments is due. It remained unclear whether the government would meet the roughly $400 million obligation due Wednesday, obtain yet another extension from creditors, or default.

Gov. Alejandro Garcia Padilla has said that the overall debt is unpayable and that he will seek a moratorium on payments, although it is still unknown whether bondholders will agree to that or opt to resolve the issue in court.

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