Governor Alejandro Garcia Padilla of Puerto Rico declared that the US territory could not afford paying back its $72 billion debt, calling it "not payable," the Sydney Morning Herald reported.
Padilla added that he intends to forge an agreement with creditors while convincing the US government to issue a decree that would permit the island to declare a special form of bankruptcy in order to dissolve some of its debts.
The governor has also appealed to creditors in postponing bond payments to help in streamlining the public debt before the end of the fiscal year on Tuesday.
In a public speech video released by the Brisbane Times, the governor also implored his fellow citizens to make sacrifices, as he requests for a legally authorized period to delay debt payment.
As Puerto Rico has long been under financial stress and falling short of settling its financial obligations, the White House appeared compassionate to the governor's plea despite uncertain approval from the US Congress.
Puerto Rico cannot easily ask for financial from any institution because it is a U.S. Territory, according to the New York Times.
The Puerto Rican government released a statement that the territory's economic condition is far worse than what people expected, as seven-figure expenditures are overlooked. This situation is aggravated by Puerto Ricans migrating to the United States in hopes of getting better work opportunities despite the fact that the US continues to experience unemployment.
One notable economic error in Puerto Rico is its continuous hiring of teachers considering that enrollees are in steady decline.
Puerto Ricans fear that the arduous and time-consuming negotiations could take its toll on the government's capacity to provide quality services for its citizenry.
Americans, on the other hand, see no financial risk in the process-at least not on a limited period. However, if Puerto Rico fails to come up with an immediate solution, it could upset the municipal bond market, which is in charge of backing national and local finances, and in return would create a domino effect to all services.
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