GDB chief takes part in UBS speaker series
GDB President Juan Carlos Batlle and UBS President Carlos Ubiñas address participants of this month’s edition of the “UBS Speaker Series.”
Government Development Bank of Puerto Rico President Juan Carlos Batlle recently addressed a group of UBS clients on the outlook for the island’s credit as part of the company’s “UBS Speaker Series” cycle that began earlier this year.
During his presentation, Batlle provided a summary of the actions the current administration has taken in the last three years to “restore growth through fiscal responsibility.”
He offered details on the outlook for four of the island’s main public debt issuers — the Puerto Rico Sales Tax Financing Corporation, known as COFINA; the Commonwealth General Obligation Bonds; Pension Obligation Bonds; and GDB senior notes — and spoke of the main economic indicators.
Moving forward, Batlle suggested that “achieving a balanced budget and maintaining fiscal discipline will significantly reduce the need for additional debt.”
He explained that the federal debt service is sustained by the income of citizens of each state, which is not the case in Puerto Rico. By factoring the federal, state and municipal debt into each state and comparing it to the state and local debt in Puerto Rico, then “Puerto Rico has the lowest total debt per capita amongst all states.”
Under this scenario and based on data obtained from Moody’s State Debt Medians Report on debt per capital for 2010, Connecticut has the highest debt per capita ($68,519), compared to Puerto Rico, which has $15,267 per capita.
The GDB chief said several states have a higher GO debt burden per capita than Puerto Rico, such as Massachusetts ($6,208), Hawaii ($5,270) and New Jersey ($5,237); Puerto Rico ranks 42 with $2,768 per capita, right after California.
