[JURIST] A UN Independent Expert has warned [press release] that increasing austerity measures to the American territory will threaten residents' human rights. Juan Pablo Bohoslavsky [official profile], the Independent Expert, stated that "ensuring financial stability, controlling public debt and reducing budget deficits are important goals, but should not be achieved at the expense of human rights." Puerto Rican austerity measures, designed to deal with the ballooning debt, have included tax increases, salary freezes, suspension of collective bargaining agreements, and a reduction in government employment contracts. Bohoslavsky stated that these measures have only "deepened the economic recession, caused higher unemployment, accelerated emigration from the island, reduced tax revenues and resulted in a downward spiral of fiscal and economic contraction." Currently, nearly half of all Puerto Ricans live below the poverty line, and it's estimated that 70% of single parent households and 57% of children are affected by poverty. Bohoslavsky warned that further spending cuts will not assist in economic recovery but will only undermine the administration of essential public services such as health, education, and social security. Bohoslavsky urged that planned reform measures not undermine access to health food, housing, and social security and create financial breathing space for Puerto Rico to implement growth-enhancing reforms.
For several years, Puerto Rico has been facing a severe financial, economic and social crisis. Currently, the island, a territory of the US, is no longer able to service its public debt of around $71.5 billion. The Puerto Rican legislature passed a bill [JURIST report] in April that would allow the island territory to enter into a state of fiscal emergency and begin the negotiation process toward a one-year debt moratorium. The territory has been suffering from a massive recession [BBC report] since 2006. However, the Puerto Rico Electronic Power Authority, a major player in the economic crisis, reached a deal [Bloomberg report] to restructure its debt in December. This deal is the first of many restructuring plans to alleviate the government's debt. In February, the Puerto Rico Legislature passed a bill [text, PDF, in Spanish] that would restructure the island's debt, which was then estimated to be $9 billion [JURIST report].