Puerto Rico’s pandemic-recession recovery rides on the back of tourism
The island is also the focus of a new task force from the Biden administration after it released billions in natural disaster relief.
With the introduction of a vaccine, Puerto Rico is now in the midst of its recovery phase against COVID-19. Last month, the territory was laying out updated measures due to the shrinking rate of cases and deaths.
Economists are now seeing signs of short-term economic recovery on the island, but as officials await vital data, uncertainty remains regarding a rebound from the ongoing recession.
The uncertainty is primarily due to Puerto Rico’s annual reporting system on growth data, which varies from the quarterly systems seen in the rest of the United States. Puerto Rico will need to wait until February or March of 2022 to receive the growth data needed to determine the recession’s effect.
Economist Heriberto Martínzez Otero — director of the House Committee on Finance and Budget — told The Weekly Journal that a recovery is occurring in Puerto Rico due to untouched, accumulated savings and the reactivation of the commercial sector and federal funding.
Otero predicts Puerto Rico will see more liquidity going forward within the cooperative system, the local banking system, and the government.
The relaxing of COVID-era restrictions was needed for the reactivation of these financial programs and the return of more frequent spending on the island. While some sectors await a full recovery, local tourism officials heavily suggest Puerto Rico is on route to seeing a tourism sector of pre-pandemic flourishing.
Unemployment issues are also looking more optimistic in Puerto Rico, as data recently published by the island’s Department of Labor indicates a year-over-year increase of 9,000 employed persons.
These findings indicate short-term recovery for the territory as long as rising COVID-19 cases do not interfere.
This news also comes shortly after the first assembly of United States President Joe Biden’s task force on Puerto Rico.
The task force is meant to steer the White House’s policy toward Puerto Rico. It formed after Biden’s administration released billions in previously withheld federal aid meant to assist the island in natural disaster recovery.
Biden is now reportedly considering deeper economic reform for Puerto Rico.
The task force — a campaign promise from the president — is considering a range of issues to focus on from eliminating debt to modernizing infrastructure.
Despite continued travel restrictions, in part due to the Delta variant, a study from the Mastercard Economics Institute has found that Puerto Rico’s tourism sector has seen continued growth due to the island’s political relationship with the United States.
Compared to June 2020’s travel levels, Puerto Rico’s passenger traffic has increased by approximately 372%.