Economy to be New Puerto Rico Governor's Biggest Challenge

Economy to be New Puerto Rico Governor's Biggest Challenge

By Jorge J. Muñiz Ortiz, Latin American Herald Tribune

SAN JUAN -- The new governor of Puerto Rico, Luis Fortuño, will be faced with the dual challenges of overcoming a serious economic crisis and resolving the U.S. territory's mounting public debt burden after he takes office later this week.In recession since 2006, the Caribbean island is beset by inflation of roughly 12 percent and an unemployment rate of 12.1 percent.

Responding to the severity of the economic situation, Fortuño created the Advisory Council for Economic and Fiscal Reconstruction, made up of 14 of Puerto Rico's most prominent business leaders, economist and lawyers.That body has recommended boosting government revenues, reducing public spending and enacting laws that promote and regulate public-private partnerships.Led by the CEO of the Banco Popular de Puerto Rico, Richard Carrion, the group issued a report saying that the island's governments behaved for many years like a family that earns $900 a month and spends $1,300, surviving on loans until the situation becomes unsustainable.

But Fortuno's decision to create the council has been criticized by various sectors that assume the new governor will raise the sales tax on goods and services.The governor-elect has pledged to balance the budget in four years, even if that means "taking painful measures." He said it will be impossible to achieve that goal in just one year because "the situation is so serious" and basic services must be provided to Puerto Ricans.Fortuño defeated incumbent Gov. Anibal Acevedo Vila on Nov. 4 in a landslide, obtaining the largest margin of victory in a Puerto Rican election in more than 44 years.

The head of the pro-statehood New Progressive Party, or PNP, received 1,014,852 votes, equivalent to 52.78 percent of the electorate. Acevedo Vila, whose Popular Democratic Party - PPD - favors an enhanced commonwealth status for Puerto Rico, is set to go on trial early next year on federal corruption charges.The inauguration day festivities will begin Friday at 11:30 a.m. with a Mass at St. John the Baptist Church in the San Juan suburb of Guaynabo.Later, the former non-voting resident commissioner of the U.S. House of Representatives and his family will wait for Acevedo Vila to pick them up and take them to the swearing-in ceremony, which is expected to begin at 3 p.m. at the Capitol in San Juan.

Among the most prominent political and religious figures expected to attend the ceremony are the president of the Dominican Republic, Leonel Fernandez; the president of Dominica, Nicholas Liverpool; the prime minister of Barbados, David Thompson; and the Vatican's apostolic delegate to Puerto Rico, Jozef Wesolowski.After he takes the oath of office before Supreme Court Chief Justice Federico Hernandez Denton, Fortuño will walk with his family and supporters from the Capitol to Fortaleza, seat of the executive branch.The new governor then will join the attending dignitaries for a gala dinner.The inauguration costs have been estimated at $487,000, half the amount spent on the swearing-in ceremonies for Acevedo Vila in 2