Panorama econòmic

Economic indicators

According to the latest IMF projections, Puerto Rico's GDP decreased by an estimated 0.7% in 2023, following a 2% increase one year earlier. The IMF expects the island’s economy to experience a further economic contraction this year (-0.2% of GDP), with a null growth rate in 2025.

The Puerto Rican economy has been suffering a recession for over a decade, leading to high levels of debt. In 2023, the general government gross debt was estimated at 16.7% of GDP by the IMF, with a slight uptick expected over the forecast horizon (17.3% by 2025). In March 2022, Puerto Rico concluded its largest debt restructuring by issuing USD 7.4 billion in new bonds to replace USD 34.3 billion in outstanding bonds, resulting in a significant reduction of 78% (data U.S. Government Accountability Office). Additionally, the restructuring included various measures to reform Puerto Rico's ailing pension system. These initiatives comprised the establishment of a new trust fund, funded by government surpluses, aimed at bolstering future pension payments. In fiscal year 2023, Puerto Rico's general fund revenues exceeded the original projections by the Puerto Rico Oversight Board by 12.8%. However, they fell short compared to fiscal year 2022. The Puerto Rico Treasury Department reported revenues of USD 12.57 billion for the fiscal year ending on June 30, marking a decrease of 1.6% compared to the previous year. A persistent impact of high inflation has continued in fiscal year 2023, but there is a significant likelihood of reduction for fiscal year 2024. The monetary policy measures imposed by the United States Federal Reserve aim to increase the benchmark interest rate or cost of money to control credit and, in turn, curb inflation. According to the latest reports, inflation is expected to decrease significantly in the United States, including Puerto Rico, for fiscal year 2024. The IMF expects the inflation rate to hover between 1.5-2% in 2024 and 2025 (down from 2.9% in 2023).

Labor force participation remains low, with only 42% of individuals of working age being employed. However, the unemployment rate has reached a historic low of 5.7% in 2023 (official governmental data). Furthermore, although the number of individuals leaving the island has decreased (Puerto Rico experienced a net loss of 0.4%, or 14,422 people, in 2023 compared to a loss of 1.3%, or 42,580 people, in 2022), the birth rate has declined and the death rate has risen. Nonetheless, the population continues to decline at a slower pace. With the destruction of nearly half a million homes after Hurricane Maria and increased unemployment brought on by the pandemic, nearly half of the population still lives below the poverty line. The island has also been dealing with a wave of violence and crime, primarily linked to gang activity and drug trafficking.

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