What you need to know about Puerto Rico's debt problems

June 30, 2015 5:18 AM

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Puerto Rico announced that it could not pay back all of its at least $US73 billion ($95 billion) in debt, a clear acknowledgment that the US territory, long under financial pressure, could no longer meet its obligations. Governor Alejandro Garcia Padilla said he would seek to work out a deal with creditors while urging Washington to pass a law allowing the island to enter a special form of bankruptcy and discharge some of its debts. The White House sounded sympathetic to the plea, although it is not clear whether Congress would permit it.

A report issued by the Puerto Rican government said the territory's financial situation is much more dire than people previously realised, with hundreds of millions of dollars in annual spending never accounted for. The circumstances have been exacerbated by an exodus of Puerto Ricans to the mainlan...

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