Estudios Técnicos, the leading planning, economic advising and market strategies firm in Puerto Rico, said today that for the coming year 2019, the economic growth on the island "will be positive".
And is that according to the firm said today in a press release, that growth will be more than 5% for the fiscal 2019 in the Fiscal Plan of the Government of Ricardo Rosselló, despite possible cuts decided by the Board of Fiscal Supervision.
"This projection and that of the subsequent three or four years will depend on the pattern of disbursements of federal funds," Technical Studies indicated in reference to the funds of the Community Development Program with Determined Subsidy for Disaster Recovery (CDBG-DR). ) by hurricanes Irma and María.
According to official data, by 2019 it is expected that the disbursement of CDBG-DR funds will start, which will total 1,500 million dollars in a first stage and 8,200 million in a second stage.
However, Estudios Técnicos said that on these payments "there is a high level of uncertainty regarding quantity and the time they will be disbursed".
Likewise, the entity mentioned some risks for the local economy that may impact the projections in 2019 and the following years, such as the loss of population that will surely continue and it will be estimated at 3 million by the year 2025.
The agency also mentioned the government's concern about the funds allocated to the health system of 4.8 billion dollars that expire in September 2019, although the impact would not be felt until 2020 if they are not renewed.
He also emphasized the additional funds for the Nutrition Assistance Program of about $ 100 million per month ending in March 2019.
"If not continued, the completion will particularly impact the retail sector of food," said the agency.
Technical Studies, in turn, recapitulated on the economic impact on the island in 2018, specifying that the Fiscal Oversight Board may have been "the most important factor in the performance of the economy," since "it became a control" .
"The measures that the Board has promoted through an austerity program not only impact Puerto Rico's capacity for growth, but also have significant social and institutional costs," said Estudios Técnicos.
Regarding the reforms proposed by the governor of Puerto Rico, Ricardo Rosselló, Estudios Técnicos indicated that "the most important" is the contributory one, which detected that "it will have relatively little impact on economic growth, although it will contribute to sustain consumption in 2019. "
Technical Studies also mentioned that the construction industry "has had an important boom due to the reconstruction efforts" of the hurricanes, although they mentioned that local companies have not benefited in the same proportion as those from abroad, which have received close 88% of contracts.
"Any projection of growth for 2019 and the three or four years after it has to be based on scenarios on the disbursement of federal funds and the start-up of construction projects," said the entity.