On September 18th 2022, Hurricane Fiona hit Puerto Rico, causing millions of dollars in damages and causing the entire island to lose power. Months later, Puerto Ricans are still suffering the effects. The constant climate disasters are causing massive ripples in Puerto Rico’s economy and population, the full impact of which could affect the island’s future.
Once Hurricane Fiona hit, it caused a massive blackout in the entire commonwealth and left many without drinkable water, while others had to be relocated entirely. The morning after, power came back for some people but an estimated 70% of the population was still left without electricity and 60% were left without drinkable water. Even weeks after the disaster struck, about 16% of the island was still without electricity.
This is not the first time Puerto Rico has been devastated by a hurricane; in 2017, it was hit by the worse disaster in its history, Hurricane Maria, which caused more than $90 billion in damages and an estimated 2,982 fatalities. Since then, Puerto Rico’s economy and infrastructure have struggled to recover, recent climate disasters have only worsened these issues.
After Hurricane Maria, Puerto Rico privatized their electric infrastructure to reduce power outages. This responsibility was given to the power consortium “LUMA Energy” which took over in June 2021 after signing a 15-year $1.5 billion contract with Puerto Rico’s government. It has been a year since “LUMA” took over and the situation has only worsened, with blackouts happening more often and lasting longer, on average, than before. This has caused the Puerto Rican population to quickly turn against the consortium and resulted in hundreds of people protesting in the streets.
What effect has this had on Puerto Rico’s economy? – The island’s economy has always struggled due to bond-related debt (more than $70 billion) and declared a rare bankruptcy-like process in 2017. Thanks to U.S. interference, which included an immense $135 billion debt adjustment plan, Puerto Rico was able to exit bankruptcy on March 15, 2022.
Although it seems that Puerto Rico’s economy is finally starting to recover, the constant blackouts and threat of climate disasters pose a serious threat to the commonwealth’s recovery. One of the main issues that Puerto Rico’s economy faces is the mass exodus of its young population. From 2010 to 2020, the island’s population decreased by nearly 12% with the main bulk of migrants being young Puerto Ricans looking for better opportunities and stability in the U.S., thus, removing Puerto Rico’s brightest young minds from its economy. Small businesses have also been severely affected by Puerto Rico’s constant climate disasters and bankruptcy issues, with many having to continuously rebuild after floods while losing power for days on end. Many small business owners wonder whether it is worth rebuilding. This is problematic as small businesses are an essential part of Puerto Rico’s economy given larger businesses' inaccessibility to most of the population.
Puerto Rico’s issues continue to go unnoticed by most of the world and what was once a great territory for potential investments, due to their relaxed tax laws, has now become a potential liability. Although efforts have been made to raise awareness of Puerto Rico’s issues, most notably by Latin superstar Bad Bunny, there is still a lot of work to be done in order to inform people about the issues faced by Puerto Ricans.