The Weekly Journal - Wednesday, March 10-16, 2021

Puerto Rico and the Caribbean

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>Courtesy of NASA

Wednesday, March 10-16, 2021 - // no. 098

Wanted: Space Port Partner P6 Tax Season has Arrived P7

FOMB:

Grant Thornton: Women at the Forefront P8

Amended Plan of Adjustment a ‘Major Milestone’ >Archive

Government pension cuts minimized

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>Evan Agostini/Invision

Rosario Fajardo

Fashion Glam is Back P14-15

rfajardo@wjournalpr.com

@RosarioWJournal

he Financial Oversight and Management Board (FOMB) announced that it filed an amended Plan of Adjustment (POA) to restructure approximately $35 billion of debt and other claims against the Commonwealth of Puerto Rico, the Public Buildings Authority (PBA), and the Employee Retirement System (ERS); and more than $50 billion of pension liabilities.

The Plan of Adjustment “is a major milestone for Puerto Rico. It can get Puerto Rico out of bankruptcy, potentially this year. Ending bankruptcy is a very important condition for economic growth, “ said FOMB Executive Director Natalie Jaresko.

She told reporters that typically, the Puerto Rico government’s approval is not needed for the POA to move forward. However, the Puerto Rico government’s approval is needed for the island to issue new bonds.

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a week in review AAFAF Disburses Over $21 Million to Municipalities

>Archive

>Josian E. Bruno Gómez

>Archive

The Puerto Rico Fiscal Agency and Financial Advisory Authority (AAFAF by its Spanish acronym) authorized the disbursement of $21.2 million in excess amount from the Sales & Use Tax Redemption Fund for the island’s municipalities. The agency said 40 municipalities will immediately be able to use the funds to help cover, among other needs, emergency expenses related to COVID-19.

Shorter Ferry Route Introduced Between Ceiba and Vieques The director of the Puerto Rico Maritime Transportation Authority, Mara Pérez Torres, announced that ferries will now be departing from the municipality of Ceiba to the Mosquito dock in the municipal island of Vieques.

The long-awaited new route shortens the trips from Ceiba to Vieques from 40 minutes to 20 minutes. As part of the initiative, the Mosquito dock has also been revamped.

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CONTINUED FROM PAGE 1 Jaresko was asked if Promesa, the federal law that enabled the creation of the FOMB and the bankruptcy process for restructuring the island’s $72 billion debt, among other issues, could enable the Oversight Board to force the Legislature and the governor to approve the sale of new bonds.

“I don’t think there is anything in Promesa that allows us to force them. No… I would like to operate on the basis that we will be able to find an agreement with the Legislature, understanding that we have protected pensions,” Jaresko said.

She underscored that Puerto Rico’s government retirees have at least a 95 percent recovery rate.

Court approval in the POA is needed from U.S. District Judge Laura Taylor Swain, who is overseeing the island’s bankruptcy proceedings.

The amended plan, filed with the U.S. District Court for the District of Puerto Rico, provides a path to exit bankruptcy as early as this calendar year and creates a foundation for Puerto Rico’s recovery and economic growth, according to the FOMB. The amended plan substantially reduces Puerto Rico’s debt and debt service payments from the government’s contractual obligations and the previous Plan of Adjustment filed in February 2020.

The terms of the amended plan also reflect the cumulative effects of the COVID-19 pandemic, the ongoing recession, and a series of natural disasters over the last several years on Puerto Rico and its economy.

The FOMB’s Natalie Jaresko >Carlos Rivera Giusti

Highlights Ø The plan reduces the outstanding Commonwealths debt and other claims by almost 80 percent, from $35 billion to $7.4 billion in new GO debt. Ø The plan reduces the maximum annual debt service from as much as $4.2 billion to $1.15 billion.

“PROMESA gave Puerto Rico a unique opportunity: an orderly path to reduce its debt to sustainable levels,” said the Oversight Board Chairman David Skeel. “This opportunity did not exist for Puerto Rico or any state in the Union. The amended Plan of Adjustment we are proposing to the court for approval is built on this opportunity.

It is a milestone for Puerto Rico’s recovery, stability and prosperity.

This plan substantially reduces the burden of debt payments on future generations, stabilizes and protects pensions that have been mismanaged for so long, and affirms the collective bargaining agreements of government workers. These elements are essential for Puerto Rico to emerge from bankruptcy once and for all and move on to a brighter future for its people,” he said.

The amended POA does not include Puerto Rico Electric Power Authority and Highways and

Ø The agreement with retirees restructures pension liabilities to enable their sustainability in the longterm, while ensuring more than 80 percent of current and future retirees see no reduction.

Transportation debts. Agreements have already been reached on COFINA (Sales Tax Financing Corp.), Government Development Bank and the Puerto Rico Aqueduct and Sewer Authority debts.

Details of the Plan

The plan includes three support agreements: the agreement with GO and PBA bondholders reached last month, the agreement with the Official Committee of Retirees (COR) and the agreement with the Public Servants United of Puerto Rico (SPU)/American Federation of State, Country and Municipal Employees (AFSCME) Council 95 to protect pensions for the long-term and secure collective bargaining agreements.

“The amended Plan of Adjustment is a contract between a diverse group of stakeholders – Puerto Rico, its retirees, a group of public employees, and certain bondholders – to help Puerto Rico manage its debt in a sustainable fashion, restore Sistema 2000 employee contributions, protect future pensions by funding a pension reserve trust, and balance its budget,” Jaresko added.

“This diverse group of stakeholders agrees that it is time to move on, to heal, to build and to grow this economy. Bankruptcy has taken a huge toll on the people of Puerto Rico, and the amended plan allows Puerto Rico to turn the corner.”

The plan’s main elements involve the restructuring of the debt of the central government, PBA and ERS; claims against the Commonwealth based on revenues historically and conditionally appropriated to certain instrumentalities; and general unsecured claims against the Commonwealth, PBA and ERS. The plan represents major concessions by bondholders and other parties, saving significant amounts in debt service that can help to protect pensions and critical government services. Ø The plan reduces the outstanding Commonwealths debt and other claims by almost 80 percent, from $35 billion to $7.4 billion in new GO debt. Ø The plan ensures “sustainable and affordable” annual debt service of less than 8 percent of fiscal year 2020 own-source revenues by reducing the maximum annual debt service from as much as $4.2 billion to $1.15 billion, making as much as $3 billion per year available for the services needed by the people of Puerto Rico. Ø The plan reduces the Commonwealth’s total debt service payments (including COFINA senior bonds) by more than 60 percent, from $90.4 billion to $34.1 billion, saving Puerto Rico almost $60

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billion in debt service payments.

The amended plan has substantial support from creditors. Holders of over $13 billion of bonds have now signed on to the GO and PBA Plan Support Agreement, representing more than 70 percent of aggregate GO and PBA claims.

The plan includes the agreements the Oversight Board previously reached with COR and a group of current government employees represented by SPU/AFSCME Council 95. Ø The agreement with retirees restructures pension liabilities to enable their sustainability in the long-term, while ensuring more than 80 percent of current and future retirees see no reduction.

In financial terms, that means retirees as a creditor group receive a recovery rate on their claims against the Commonwealth of over 95 percent, by far the largest recovery of all creditor groups.

The agreement includes a flat 8.5 percent pension cut with a floor so that no one will have their total monthly retirement benefits reduced below $1,500.

Further, the agreement would establish an independently managed pension reserve trust for the PayGo pension system to support payment of pensions over the next 30 years. This provides considerable certainty the retirement savings from Puerto Rico’s government workers will be protected well into the future.

Finally, the envisioned pension reductions can be restored if government finances outperform the Certified Fiscal Plan by $100 million or more in any given year; 10 percent of the excess would be allocated to retirees to offset the pension cut. Ø The agreement with SPU/AFSCME ensures that collective bargaining agreements will remain in effect for five years following the plan’s effective date, reflecting labor terms in the Certified Fiscal Plan and increased employer contributions to the medical plan set at $170 per month, rather than the $125 provided in the Certified Fiscal Plan.

Up to $1.5 billion of employees’ contributions to Sistema 2000 would be returned in full to participants along with any interest credits the contributions would have accrued before Puerto Rico’s bankruptcy.

If government finances outperform the Certified Fiscal Plan by $100 million or more in any given year, 25 percent of the excess would be allocated to eligible employees, incentivizing employees to help the government work more efficiently.

Mixed Reviews

Gov. Pedro Pierluisi said he was still against cuts to government pensions. “My administration has been emphatic that this cut to pensions is not reasonable and it is not necessary to confirm the Adjustment Plan, so we will leave it established in the confirmation process before the Title III Court,” Pierluisi said in a written statement.

“My government will actively participate in the confirmation process that begins now and will defend the best interests of our People, including the interests of our pensioners,” he added.

“I have been clear that Puerto Rico needs to leave this bankruptcy process behind in order to

Most government retirees will not be affected by pension cuts. >Archive

achieve the sustainable economic development to which we all aspire and eliminate the uncertainty inherent in this process, as well as the [milliondollar] expenses of the restructuring that the government has had to incur,” he stated.

Puerto Rico economist José Caraballo said the plan had positive and negative aspects and recommended that the governor negotiate with the board to protect pensions up to $2,000 and then impose a 10 percent cut on anything higher.

“You have to seek a little flexibility,” he said in a phone interview with The Associated Press.

Caraballo said he supports the plan’s call to create a pension reserve trust, noting that pensions are currently paid by tax revenues.

He also agrees that the amount of money bondholders would receive is to be contingent on the ups and downs of government revenue flows.

However, he worries that creditors would be paid what he considers an excessive amount.

“Practically 30 percent of Puerto Rico’s budget will go toward paying retirees and bondholders,” he said, adding that the island’s legislature could be a game changer because it would have to approve the issuance of new bonds as outlined in the plan. “That’s where we could see a roadblock.”

Daniel Santamaría Ots, an economist and senior analyst of Public Policy at Espacios Abiertos, has predicted that under the FOMB’s scenario, the Puerto Rico government will run out of cash in or before 2029 and would entail making more fiscal adjustments down the road.

“What remains constant with this new agreement are the Board’s own projections that in a baseline scenario, Puerto Rico would run out of money to operate the government in, or before, 2029. That implies that in the next eight years, more fiscal adjustments will have to be made to comply with the payment of the debt and to be able to operate the government,” he stated.

Before committing the people of Puerto Rico to a 25-year debt payment term, the FOMB needs to make new macroeconomic projections now, and an updated Fiscal Plan be published and certified, he indicated. “It is imperative that the Board speak clearly about the adjustments that the government will need to make in less than eight years to give continuity to the operation of its services, since the projected savings from the structural reforms, according to the Board itself, will not be enough to cover the debt payment and the government’s operations,” Santamaría said.

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Puerto Rico Hopes to Join the Space Race

Information, which is to knock on the doors of all aerospace companies, both launch, manufacturing and satellite, and let them know that Puerto Rico has these conditions… There is a great opportunity for economic development for our youth and the island in the space market,” he added.

Partner sought for space port in Ceiba

T Rosario Fajardo

rfajardo@wjournalpr.com

@RosarioWJournal

he island already has a healthy and robust aerospace industry and now wants an even bigger slice of the space-race sector.

The Puerto Rico Ports Authority has released a request for information (RFI) for companies that may be interested in developing a space port at the José Aponte de la Torre (JAT) regional airport in Ceiba, located just a few miles from the former Roosevelt Roads Naval Station, which the central government has been trying to fully develop for years.

“The JAT property is truly a unique and rare resource, having been isolated from normal redevelopment trends since the early part of the last century and situated at the foothills of El Yunque National Rainforest – one of the world’s greatest natural wonders. It’s location at the eastern tip of Puerto Rico, centrally situated between the continents of North and South America and with viable trajectories to a large range of desirable low-earth orbit launch inclinations make the location highly desirable for satellite operators to use to place their satellites into orbit,” said Ports in its RFI. The government is seeking input for JAT to be “an option for experts and innovative members of the aerospace industry to consider rental space for manufacture, storage, processing or any other aerospace-related activities and how their operations can be considered to be located in Puerto Rico.”

The JAT airport currently offers scheduled passenger service via three commercial airlines to the islands of Vieques and Culebra. The airport covers an area of 1,646 acres at an elevation of 38 feet above mean sea level. The facility has one operating runway and a closed runway.

“Recent studies, analyses and waivers show significant potential economic benefit through the development of a potential commercial space launch facility. The geographic location and configuration of JAT as a commercial launch site offers a significant range of safe launch inclinations from polar and sun synchronous orbit to equatorial orbits for three launch vehicle types

The Aerospace Industry in Puerto Rico

that take off and land horizontally,” according to the RFI. Interested companies have until May 26 to submit their responses.

If the envisioned project is successful, it could help jumpstart the local economy in Ceiba, since Roosevelt Roads was closed in 2008.

“The aerospace industry is one of the economic sectors that is experiencing the fastest growth. In fact, in the midst of the pandemic, it was one of the few sectors that did not receive much impact,” said Joel A. Pizá Batiz, executive director of the Ports Authority.

“What we did was an RFI, a Request for

Ceiba’s regional airport >Inter News Service

The island has long been a magnet for the aerospace industry. Some of the aerospace companies with facilities in Puerto Rico—many of them concentrated in the northwest region of the island—include Honeywell Aerospace, Collins Aerospace, Pratt and Whitney, Lufthansa Technik, Lockheed Martin, DXC Technologies, El-COM Systems, OPTI Manufacturing, Global Tek Manufacturing, CNC 2000, Multi-Axis Manufacturing and Jet Aviation San Juan FBO. The aerospace ecosystem is also complemented by a number of educational, scientific and research institutions such as the University of Puerto Rico’s (UPR) Nanotechnology Laboratory; Inter American University’s Aviation School; the Aeronautical and Aerospace Institute of Puerto Rico (a subsidiary of the UPR’s Aguadilla Campus); and various related programs at the Polytechnic University, Sistema Ana G. Méndez and Caribbean University. UPR Mayagüez’s engineering program also offers a pipeline of trained professionals to many companies in the aerospace-related industry.

Sadly, the famous Arecibo telescope’s 900ton receiver platform and the Gregorian dome collapsed last year. The National Science Foundation said that it could cost up to $50 million just to clean up the debris at a renowned radio telescope that collapsed last year in Puerto Rico, adding that investigations into what caused its cables to fail are still ongoing.

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Treasury Secretary Francisco Parés Alicea >Carlos Rivera Giusti

Puerto Rico Treasury Kicks Off Tax Cycle With Record Numbers Pays out $22.8 million in tax refunds, thus far

P Giovanna Garofalo

ggarofalo@wjournalpr.com

@giopgarofalo

uerto Rico Treasury Secretary Francisco Parés Alicea revealed that the island has kicked off this year’s tax cycle, having already received 117,081 Individual Income Tax Returns for 2020. Of these, 32,916 have already been refunded, for a total of $22.8 million.

“I think this is the first time that the Department of the Treasury (Hacienda) has such a large number in terms of the number of returns not only filed but already processed and refunded; having that money where it needs to be, which is in people’s pockets and not necessarily in the coffers of the Treasury Department,” Parés stated at a press conference.

According to the secretary, this year’s tax cycle is “pro-taxpayer” because of its several tax benefits. As informed, individuals will benefit from an additional 3 percent discount in the tax rate.

Combined with the 5 percent decrease applied to the 2019 tax return, this represents a total 8 percent discount for taxpayers in the current cycle.

Moreover, salaried individuals whose personal incomes do not exceed $42,000 are eligible for the credit for work, ranging from $300 to $2,000. “The amount will depend on how much income that person generated and how many dependents they

have. The lower the income and the higher the number of dependents,” the higher the credit to be disbursed, he explained.

Likewise, university students who are either dependents or taxpayers themselves and are in their first four years of college have the opportunity to receive the American Opportunity Credit of up to $1,000 per year. Because this applies retroactively since the 2017 tax return, they may receive up to $3,000 in total.

Concerning delayed refunds from the previous cycle, the official said that there are roughly “1,500 refunds pending for the Treasury’s approval. The last corresponding test is already being carried out to issue them.”

Retroactive Economic Stimulus

Parés said that this year’s tax return includes the option to claim the COVID-19 economic stimulus payments of $1,200 and $600 as refundable credits, using Schedule B3 of the return, to claim both payments or incomplete payments.

Hacienda will send a notification via email to taxpayers who still haven’t received one or neither of these payments, called Model SC 6174 - Notice of Additional Federal Economic Impact. “This communication certifies the payments that each citizen has received, as recorded in our records and will be needed by eligible citizens, to complete the claim through Schedule B3, Economic Impact Payment, which must be submitted with the [tax] return,” the official informed.

If, for example, the taxpayer’s demographics changed because of the inclusion of a new dependent, they may request the $600 dependent

aid from the first CARES Act, and the $500 in the second economic stimulus act, retroactively.

Meanwhile, Parés underscored that individuals must report all government-issued payments received throughout the year. This includes the $600 and $1,200 economic relief for individuals, unemployment benefits and the Pandemic Unemployment Assistance (PUA), among others.

However, he clarified that these are not subject to taxes.

Deadline to File Tax Return

The Individual Income Tax Return for 2020 must be filed online on or before April 15, using a program certified by the Treasury Department, available on www.hacienda.pr.gov, and through active Tax Return Specialists, found on the SURI website under “Services.” The list of specialists includes more than 3,000 contacts islandwide.

Individuals may also file their tax returns directly on their SURI taxpayer accounts.

Asked if, like last year, the period to file the tax return would be extended, Parés affirmed that if the federal government comes through with the next economic relief bill —which would provide direct payments of $1,400 for most Americans and Puerto Ricans— Hacienda’s work plans may need to be altered “and it definitely puts us in an almost inevitable position in which we will probably have to use that power delegated by the Legislative Assembly.”

Taxpayers who haven’t filed the tax return after April 15 can request an automatic extension online through SURI with the SC2644 Form. The extension request only extends the term to file the Individual Return, not the time to pay any outstanding balance that may arise with said return.

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>Carlos Rivera Giusti

>Josian E. Bruno Gómez

/ Wednesday, March 10, 2021

Women in Business 2021: A Window of Opportunity

Pandemic has been a doubleedged sword for women Rosario Fajardo

rfajardo@wjournalpr.com

@RosarioWJournal

Editor’s note: Second of a two-part series on women in business

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he seismic event of the coronavirus pandemic has dramatically changed how we live and work. In the business world, some of the changes that will likely be permanent include a more flexible, hybrid schedule, as so many people have been working from home for months at a time.

For women, the pandemic has been a doubleedged sword, according to the Women in Business 2021 report by Grant Thornton, a leading multinational independent audit, tax and advisory firm.

On the positive side, women’s rise in senior roles in the business world has not been stopped by the COVID-19 pandemic. As previously reported by THE WEEKLY JOURNAL, the percentage of women holding leadership positions in companies has hit the important 30 percent threshold globally, despite the challenges of COVID-19. The milestone is particularly important because Grant Thornton’s previous two reports (2019 and 2020) had the figure stuck at 29 percent.

“The pandemic has created a window of opportunity to include more women in senior

management,” said Kim Schmidt, global leader at Grant Thornton International. “The most obvious initial impact was that many of us were forced to work from home. This challenged traditional thinking around what working flexibly means and should have a lasting impact on how leaders think about it. It might even have changed some decisions leaders made during 2020, by removing unconscious biases, and led to a more positive evaluation of female talent.”

At Kevane Grant Thornton in Puerto Rico, the gender ratio of leadership positions is even higher than the global average. Currently, the figure is at 57 percent women and 43 percent men, according to Kevane Grant Thornton Managing Partner Luis Carlos Marcano. He indicated that the new numbers reflect the “integration” in Jan. 2021 of four new partners at the company, along with 30 other professionals.

“However, women continue to lead… Before the integration, the average ratio was 65 percent of women in leadership positions at the firm,” he said.

At the same time, Marcano said Kevane Grant Thornton is also committed to another aspect of the gender divide in the business world, namely pay equity to address the gender pay gap. “We provide the same range of salaries and opportunities of career advancement, like leadership trainings, opportunities to advance in other professional certifications beside the CPA license, opportunities of secondments in other member firms within the Grant Thornton International organization. We also assign the same level of clients to our management and most important, flexible work arrangements to foster life/work balance,” he explained.

Marcano was alluding to the continuing challenges that many women continue to face in

the business world, which has been highlighted by the COVID-19 pandemic. While flexible and hybrid schedules have been a positive in many respects, this new reality has also had negative impacts for women.

Various Setbacks

For example, the Grant Thornton report mentions that women have been more greatly affected by redundancies and furloughing during the pandemic. The Pew Research Center reported that in the U.S., between February and May 2020, 11.5 million women lost their jobs compared to 9 million men. Meanwhile, in the United Kingdom (U.K.), an Institute for Fiscal Studies report showed that mothers were 23 percent more likely than fathers to become unemployed during the pandemic.

In addition, women have shouldered more of the childcaring responsibilities during lockdowns in many countries. Combined research by the universities of Oxford, Cambridge and Zurich found that in the U.K., U.S. and Germany, women across all income brackets did more childcare and home schooling than men during lockdowns.

“While the experience for many women in the workplace during 2020 has been challenging – bearing the brunt of the pandemic’s economic and social fallout including job losses, furloughing and increased caring responsibilities – in the sphere of senior management, the story has been largely positive. In 2021, we see a greater proportion of women in senior management globally than ever before. And with the 30 percent tipping point being passed both globally and in most regions, the expectation is for this trend to accelerate,” said the Grant Thornton report.

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Retail Trade Association: Internet Sales Skyrocket 35 Percent During Pandemic While brick-and-mortar sales drop slightly by 3 percent

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The Weekly Journal Staff

he coronavirus pandemic has upended the world in so many ways and new data from the Retail Trade Association(ACDET by its Spanish acronym) is confirming how the coronavirus pandemic has transformed consumer behavior and shopping trends in Puerto Rico, perhaps for good. transactions and present the various changes As reported by THE WEEKLY JOURNAL, the new and global best practices so that Puerto Rico’s consumer behavior trends include a big increase businesses are prepared to face the changes that in e-commerce, a drop in “brick and mortar” sales, will likely continue in retail. the skyrocketing use of technology, and a greater “That is why we do not skimp on bringing shopping focus on basic supplies (groceries and Dan O’Connor, an executive fellow at Harvard medicine) and home goods.

Business School and recognized worldwide for In its annual forum, the ACDET revealed that the development of the retail generation model, due to the pandemic, internet and its evolution over time and sales have increased by more countries,” Otero added. than 35 percent, while brick-andIn his keynote address, mortar stores have seen their The Next Generation sales drop by 3 percent, and over of Commerce: Are You 60 percent of consumers have Ready?, O’Connor presented Contactless used contactless options, such his well-known model of retail payments have as mobile apps and curbside generations and led the audience exploded since pickups. on a “journey of evolution” to see March 2020: Five ACDET Executive Director the changes in business models, out of 10 payment Lymaris Otero opined that this talent and capital that companies, transactions are scenario “requires merchants to brands and retailers have been now done without enact systemic and technological implementing globally. contact, with Puerto changes at speedy paces to stay In this journey, he urged the Rico being the in the market. Our mission as a audience to evaluate how to leader in the region retailers’ association is to facilitate effectively implement strategies in this area. the best resources to our to stay competitive in the battle members that they may execute.” between brick-and-mortar sales As a result of the and internet sales. In recent years transcendental changes that the and now due to the pandemic, retail sector has suffered, due to the dynamics internet sales have been gaining more and more of internet sales and now more rapidly after the ground versus sales at physical stores.

COVID-19 pandemic, the focus of the forum was “Sales are fragmenting, so retail has to think on providing tools for security in internet sales differently. The generations of retail have evolved

In fact,

According to a survey, 60 percent of consumers prefer contactless payments. >Mark Lennihan/AP Photo, File

from e-commerce to marketplaces to social commerce, and to be ‘super app’ businesses.

Retailers that are not able to cross that gap by 2025 to effectively integrate their offline business with their online business will not survive,” he warned.

Prior to joining Harvard’s Advanced Leadership Initiative, O’Connor founded RetailNet Group, an “advisory and insights” firm for leading retailers and brands worldwide.

Protecting Businesses From Cybercrimes

The keynote talk was complemented by a technical talk, aimed at addressing another pandemic issue, that of cybercrimes.

Héctor Guillermo Martínez, president of GM Sectec, a company dedicated to offering solutions and services in cybersecurity and fraud reduction, offered an overview of the vulnerability of businesses, especially small and midsize enterprises, to being victims of cyber-attacks that threaten their businesses online and the security of their customers’ data.

With the acceleration of online stores, companies that do not have secure and encrypted information systems are reportedly three times more vulnerable to cyber-attacks.

Martínez underscored how contactless payments have exploded since March 2020: “Five out of 10 payment transactions are [now] done without contact, with Puerto Rico being the leader in the region in this area,” he said.

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Pick My Stuff: Local Company Scores Big With Large Retailers Revenues sore throughout the pandemic

I

Giovanna Garofalo

ggarofalo@wjournalpr.com

@giopgarofalo

n the “Republic,” Plato famously indicated that necessity is the mother of invention. When Yin Luna would drive around Puerto Rico, he noticed that people would carry large appliances and home items in illsuited vehicles, sparking a business idea to address this need. And thus, in 2015 he launched Pick My Stuff Transportation Services, an islandwide same-day delivery service for individuals and businesses.

Under the company’s original model, Luna developed a network of independent drivers with a variety of vehicles - from motorcycles to trucks - and would pick up and deliver merchandise. In 2016, he joined the accelerator program of Parallel18, where he was able to hone his business management skills through seminars and mentorship. However, when Hurricane Maria devastated the island in 2017, his business struggled due to the devastated telecommunications infrastructure and the fact that his drivers found new jobs with FEMA. Pick My Stuff is headquartered in Ponce, but offers services islandwide. >Courtesy Gradually, he acquired his own set of vehicles and looked to retailers as the next big step for Biga, detailed that sales grew by 40 percent by delivering mattresses and furniture free of Pick My Stuff, in addition to providing services for throughout 2020, and an even greater increase charge.” his former clients, and hired staff. “Although I still is projected for 2021. “We have 12 partnerships use independent drivers, it is not my main model. under wraps and we expect to release the news Along the road, I focused on the retail market Growth Throughout the Pandemic this year,” she said. to move furniture and appliances,” he told THE While the coronavirus pandemic has taken WEEKLY JOURNAL. a toll on multiple economic Headquartered in Ponce, Pick sectors, Pick My Stuff was able Exports On the Line My Stuff now has 12 vehicles to boost its revenues by securing Asked about his plans for expansion, Luna stationed in different points exclusive contracts with Sam’s affirmed that he aims to export his services to across Puerto Rico, plus several and Walmart, two of the largest the U.S. mainland. “We are the first company on dozen drivers, and even provides retailers in Puerto Rico. a national scale that offers this type of service to The company’s delivery services to the municipal “There has been considerable Sam’s and Walmart, so we are pioneers in that sales grew by 40 islands of Vieques and Culebra growth in delivery requests regard. Their eyes are set here. They are looking percent throughout through a partnership with Air and companies have realized closely at what we are doing and I hold monthly 2020, and an even Flamenco. that it is an important tool for communications with the United States and I greater increase is In addition to selling services, their businesses. I have always send them weekly reports,” he stated. projected for 2021. the company is committed to vouched for delivery as a sales Luna added that he wants to cater to “all types helping vulnerable populations. strategy because the easier you of businesses that sell products” because it would “Sometimes clients tell us that make a purchase, the more allow Pick My Stuff to optimize their travels. “The they want to donate something, business opportunities open. fewer businesses, the more exclusive it is. My so we take the products to the Now everyone has realized that goal per se is to become a renowned company Salvation Army or another donation center,” Luna customers need it, and with the pandemic, people in terms of delivery of furniture, appliances and said. “We have also helped people who have lost want to avoid contact,” he explained. large items to homes and businesses. The plan is their homes. In the aftermath of Maria, we helped A spokesperson for the company, Alexandra to keep growing,” he affirmed.

In fact,

11 < The Weekly Journal> Wednesday, March 10, 2021

Luego de un fuego u otro desastre, la Cruz Roja Americana provee ayuda financiera, apoyo emocional y asiste en la recuperación de las familias afectadas. Si usted ha sido afectado por un desastre, llame al 787-758-8150.

¡Dona hoy!

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Omar J. Marrero

Executive Director of the Puerto Rico Fiscal Agency and Financial Advisory Authority

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Making History with the Debt Agreement

he debt restructuring process of the Government of Puerto Rico is the largest and most complex debt restructuring in the history of taxexempt bonds in the United States.

Therefore, this process is a point of reference for possible future municipal restructurings in the whole Nation. With the agreement recently announced by the Oversight Board and a group of general bond creditors, we may conclude that we will make at least three significant

contributions to our fellow citizens.

First, it is undeniable that the better the economic future of a jurisdiction, the larger the debt amount that it can pay. As in all negotiations, the debtor is more cautiously optimistic than the bondholders as to the future of the jurisdiction. In the case of Puerto Rico, a Contingent Value Instrument (CVI) was selected in order to be able to reach an agreement. The CVI is paid to bondholders only if IVU (sales tax) revenue projections exceed the estimates of the May 2020 Fiscal Plan. Therefore, in the event of that contingency, half of the excess will be paid to the CVIs, up to $200 million. In

Susan Segal

President and CEO of Americas Society / Council of the Americas

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The Opportunity for Women After a Year of Pandemic

t has been a year since the World Health Organization (WHO) declared COVID-19 a pandemic. During that time, too many people have died and our lives have been turned upside down. Women have been particularly affected.

Women accounted for a higher percentage of job losses and were forced to close businesses at a higher rate. They were laid off and some were simply forced to leave the workforce to take care of their homes and families, as many children were unable to attend school or had to attend school virtually. In some cases women took on the additional responsibility of homeschooling their children. Eventually, child care became even more limited and was not a viable option. Women also assumed a

greater role than their male partners or counterparts in caring for elderly parents and sick family members.

Women also work disproportionately in the informal sector, as well as in the retail, hotel and tourism sectors, which were some of the hardest hit by COVID. Equally tragic was the number of women who closed businesses in Latin America: 39% compared to 29% of men, according to the World Bank .

As a result, the contraction of the workforce for women in Latin America during the course of the pandemic has been much more dramatic: 10.4% versus 7.4% for men, according to the International Labor Organization . In Colombia, the female unemployment rate was 25% compared to 14% for men; in Argentina 13.1% compared to 10.6% of men; and in Mexico the

other words, Puerto Rico could pay an additional amount to bondholders, but only if the economy is growing beyond the projections. In this sense, a marginal benefit for the island is that the powerful firms on Wall Street will favor bills in Congress that promote the economic success of Puerto Rico.

The second point is the special treatment to pensioners. The Detroit bankruptcy had already established that pensioners had to be treated better than other creditors. Despite that, Detroit pensioners saw their pensions reduced by 4.5%, contributions to the health plan eliminated, and automatic cost of living adjustments canceled.

The Government of Puerto Rico is fighting so that there are no pension cuts. The big difference between Puerto Rico and Detroit is that through Act 3-2013, government employee pension benefits had already been reduced. Reducing pensions would be in addition to the cuts enacted through said statute.

The third point of the agreement is that it is feasible. This agreement

reduces the total central government debt to $7.4 billion, from $35 billion, and the annual payment to $1.15 billion, from $4.2 billion, on average.

However, there is no point in reducing the debt and protecting pensioners if we go back to bankruptcy in the coming years. The financial and economic metrics indicate that the resultant debt level is sustainable.

In addition, the debt service is at 7.6% of the government’s ownsource revenue. By comparison, at a national level, the 10 most indebted states have an average debt service of 9.2% of their own-source revenue.

The Constitution of Puerto Rico sets 15% as the maximum that would be prudent to pledge in debt. Another metric is that the debt is reduced to 53% of the Gross Domestic Product.

When the European Union made the conversion to the Euro, it set 60% of the Gross Domestic Product as a healthy debt level.

The debt restructuring agreement puts us on the path to a goal all Puerto Ricans share, the end of the bankruptcy and the Oversight Board.

We are on our way.

unemployment rate for women was double that of men. Finally, in Brazil women represented 51% of the unemployed and underemployed.

So today we are at a painful crossroads , not only for women, but also for economic recovery and growth in Latin America. According to a 2020 report from the McKinsey Global Institute on gender equality and COVID-19, global Gross Domestic Product growth could rise to $ 13 trillion in 2030 if the unemployment rate for women equaled that of men. Imagine the effect this could have on the economic recovery of Latin America, as well as having a tremendous impact on social development.

But achieving this is a huge challenge, as we not only need to get back to where we were in the pre-pandemic era of 2018 where only 52% of women participated in the workforce compared to 77% of men, but also make a leap to a new level where women and men fight for parity.

Transforming this goal into a reality will require enormous efforts from the public and private sectors.

They will need to work together to get women back into the workforce, as well as to significantly increase female participation. Specifically, public and private organizations need to collaborate in training and job creation for women and youth.

Incentives need to be created to ensure that companies hire more women. Culture must also be created in certain corporate sectors for workers to work remotely, including from home. To this must be added the flexibility of schedules to encourage women to return to the workforce.

Equally important, companies should not punish women who have left their jobs due to the pandemic.

Rather, they should incentivize them to return to the workforce. In other words, women should not miss the opportunity to move up and accept more job responsibility. Finally, companies should always consider women when interviewing new employees.

We know that there are many challenges women face, from being able to afford child care to accessing broadband for remote work. But the pandemic also brings the possibility for women to prosper by creating their own businesses. It is vital to support and mentor women who want to be entrepreneurs. Many businesses are thinking about how to support in this way, but organizations like the Inter-American Development Bank have also launched programs to address this critical problem.

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/ Wednesday, March 10, 2021

El Platanal Expands Culinary Offerings to Hato Rey Opens third establishment in Puerto Rico

T Yaira Solís Escudero

ysolis@elvocero.com

@yairasolis

he COVID-19 pandemic was not a deterrent for Rafael Hidalgo to opening the third branch of El Platanal. That is how the culinary offering of this emblematic restaurant —which opened 12 years ago in Carolina followed by another location in Cupey— recently opened its doors on Roosevelt Avenue in Hato Rey, San Juan.

“The preparations for the Hato Rey restaurant were in process when the pandemic arrived and, although at some point I came to worry a bit about the uncertainty that this new situation brought to the island, I tried to stay focused on my vision of growing the company. That strengthened my confidence to go ahead with both projects. Today I feel satisfied and happy with the results and the acceptance of our guests,” he told EL VOCERO, THE WEEKLY JOURNAL’s sister publication.

The new restaurant also reinforces the culinary offerings on Roosevelt Avenue —close to Milla de Oro— one that in the past 10 years has seen several of the area’s culinary temples close.

Today, El Platanal, along with other surrounding businesses such as Cayo Caribe and El Olivo, are beginning to return economic activity to the Golden Mile area, which is so necessary to revitalize the sector and guide it towards its evolution as a gastronomic district.

Although El Platanal serves the same menu at all three establishments, Hidalgo decided to open the restaurant in Hato Rey with three new dishes: a juicy ribeye steak with “trifongo” —mofongo maid with green plantains, sweet plantains and yucca— or with “tostones”; turbot fillet cooked “al ajillo” or “a la criolla,” and yucca bowls filled with crab meat.

Moreover, the two-story restaurant features a modern, wooden design. The second level houses

Mofongo topped with baked “pernil” and pork rinds. >All photos are courtesy of El Platanal

Rafael Hidalgo joins other restauranteurs in developing Hato Rey as a culinary district.

Creamy plantain soup topped with crispy plantain chips, known as “platanutres.”

an activity room and the establishment will soon feature an open-spaced terrace. The kitchen has a modern service system to streamline orders and minimize waiting time. Likewise, Hidalgo prepared an area on the first level to organize orders that are for delivery or pick-up, tempering his business to the reality of the times, with an increase in food orders for home delivery.

As for the food’s flavor and consistency, your correspondent visited the establishment to confirm that the famous plantain sandwich retains the same savor and texture, as well as the “arroz mamposteao,” pumpkin cream and mofongo stuffed with “ropa vieja,” among other culinary delights.

Other must-have items on the menu include the “asopao de mariscos” (seafood soup), “carne frita” (fried meat) with mofongo; beefsteak covered in onions and paired with “arroz apastelado;” kankan steak, pork chops with crispy rinds on the edges, accompanied with tostones, and a turbot or mahi-mahi cooked “a la criolla,” served with yucca mofongo, among others.

The restaurant is located on Roosevelt Ave. #252 and it is open every day of the week from 10:00 a.m. to 10:00 p.m., just like the other two establishments in Carolina and Cupey. For more information, call 787-705-7892.

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/ Wednesday, March 10, 2021

Christian Siriano Offers Mountain Glam for Second Pandemic Show

Inspired by a jaunt to Colorado

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The Associated Press

> All photos by Evan Agostini/Invision/AP

EW YORK (AP) — Christian Siriano opened his second show of the pandemic with two ladies in bed, models who emerged flawless in black one-pieces, then dressed for all to see before hitting the runway.

It was a dreamy, color-saturated show during a tough time for fashion inspiration, Siriano said. He created an alternate reality inspired by a recent jaunt to Aspen, Colorado, to visit family for the first time in a year.

While most designers have gone fully digital during the recently expanded New York Fashion Week that has stretched the traditional calendar, Siriano remains committed to the runway.

“If you take this away, and the glamour, then it’s like I’m just at the office talking about money all day, and that’s not what I want,” he told The Associated Press after the fall-winter show attended by about 75 in-person guests. “I wouldn’t want to do this job if I couldn’t have this world.”

In this world, shared on Instagram Live, there were looks for hidden parties and cocktail hours in the Colorado mountains, and silky evening dresses in fuchsia and chartreuse. There were cutouts, and ruffles and lace for ombre and peekaboo impact.

And there was Siriano muse Coca Rocha camping it up for the cameras in a voluminous black gown with a plunging neckline — after she woke up to start the show.

Siriano included two thrifted pieces he previously designed and found on the site thredUP, including a black fringe coat he made about seven years ago. He was pleasantly surprised it held up, both aesthetically and through its well-worn years. The other look was a plunging silk crepe dress in fuchsia washed many times.

“You shouldn’t do that because it’s silk, but it looked so cool. It looked worn but new. Hopefully it will show people we can do this in fashion,”

Siriano said of the growing reuse movement.

He partnered with thredUP after creating the universal logo for thrift, in the shape of a coat hanger.

As for his newly created clothes, there was an “homage to the lodge” in plaid lames and cashmeres, melting into sunset-drenched oranges and pinks inspired by his Colorado vacation. He threw in some creams in a snakeskin print and bright winter whites, including a white jacket worn with loose fuchsia trousers for day.

Siriano carried his check lame print from a trouser set to a strapless cocktail gown to a loose, long-sleeve top with a plunge. There were psychedelic swirls of orange and brown in a pantsuit and an evening dress with a high slit.

What if, heaven forbid, he’s forced to design a third collection in a pandemic come the September show cycle, trying to wrangle staff working remotely while sourcing materials.

“Honestly, I don’t know,” Siriano said, “because I love doing this but it’s very hard to do in a pandemic. The logistics are a challenge, but we’re just going to move on and hope for the best.”

/ Wednesday, March 10, 2021

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