Wednesday, March 25-31, 2020 / no. 048
Puerto Rico and the Caribbean
www.theweeklyjournal.com
Federal Govt.’s Aid Package for Coronavirus Crisis Still Dependent on Congressional Action P6 Puerto Rico’s Economic Relief Plan for Virus Quarantine Should Evolve as the Pandemic Itself P8 Tourism Industry Pays a Heavy Toll due to Earthquakes,Virus Lockdown P10
Private Sector Shares Concerns Over COVID-19
Emergency Management
Afraid of layoffs and considerable revenue loss
Giovanna Garofalo
Achú!, an Activity Book to Teach Children About the Coronavirus and Staying Safe P13
ggarofalo@wjournalpr.com
W
@giopgarofalo
ith more than one week of inactivity and/or limited operations, members of Puerto Rico’s private sector are concerned about the financial repercussions that will arise as a result of the government’s plan to stop the spread of coronavirus (COVID-19) on the island.
Governor Wanda Vázquez enacted Executive Order 2020-023 on March 15, imposing a curfew from 9 p.m. to 5 a.m. and a general lockdown until March 30. Certain types of groups and businesses are exempt from the lockdown, such as the media, drugstores, supermarkets, gas stations, pharmaceutical companies, call centers, health centers and hospitals, airports and restaurants that offer delivery, carry-out, and/or drive-thru services, among others. GO TO PAGE 4
The Weekly Journal > Wednesday, March 25, 2020 > 2
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a week in review Gas stations also affected by the coronavirus With oil prices at their lowest since almost two decades, gas stations throughout the island are suffering a sharp drop in sales that could lead many of them out of business. Since Governor Wanda Vázquez enacted the 15 dayquarantine to avoid the spreading of the virus, consumers’ demand for fuel has diminished because ground transportation has almost come to a halt.
Car sales take a plunge in March
Flights redirected
After cars sale showed an increase of 8.5 percent in February, the “Grupo Unido de Importadores de Automóviles” (GUIA) anticipates between 25 and 30 percent less sales in March due to the Governor’s executive order to avoid the spreading of the virus. The order forbids all commercial activities, except those considered to be essential. Dealership owners and operators are already taken measures to minimize the impact on their businesses.
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Major airline and international flights arriving to all airports in Puerto Rico have been redirected to the Luis Muñoz Marín International Airport in Carolina by the Federal Aviation Agency (FAA). The change was in response to a petition made by Gov. Wanda Vázquez seeking to facilitate the task of identifying possible cases of coronavirus entering the island via the airports. According to the governor, the airport in Carolina is the only one in the island that has the technology to detect those cases.
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CONTINUED FROM PAGE 1 Some employers that do not fit into these categories have provided the option to work from home, but for many Puerto Rican businesses and workers the lockdown represents a loss of income or revenue that could seriously harm their budgets, thus generating uncertainty. The secretary of the Department of Economic Development and Commerce (DDEC by its Spanish acronym), Manuel Laboy, said that his agency’s top concern at the moment is the Vázquez administration’s public policy to prioritize health in light of the unprecedented pandemic that has affected nearly 400,000 people worldwide at the time of this writing. “Apart from that, provide certainty to the private sector… We released a circular letter to provide clarity in terms of who can and cannot operate under the executive order, answering questions and addressing concerns from the private sector,” Laboy told THE WEEKLY JOURNAL. Vicente “Chenti” Feliciano, a renowned economist who recently joined the new economic task force to mitigate the financial impact of the current situation, attended a meeting held last week in which leaders of the private sector discussed several disturbances with public officials, including Laboy. According to Feliciano, one of the top concerns is finding a balance between safeguarding public
The longer the lockdown is extended, the higher the number of companies that will never reopen. Vicente “Chenti” Feliciano
health and keeping the economy moving, albeit limitedly. “When there is a health risk, health comes first, but if we take too long [to reopen] many of those companies that are now closed will never open again,” he warned. This would then lead to a significant number of layoffs and debts that could worsen an already crippling economy. Feliciano also noted that the tourism sector is taking one of the heaviest blows because the San Juan Bay is closed, air traffic is limited, and the international trend per official recommendations is to stay home and avoid travel. “The losses in the tourism sector are brutal, and it will be months before we can establish a regular flow of tourists and for people to feel comfortable boarding a plane, and even more time with cruises,” he said. Laboy said that after the world normalizes and
DDEC Secretary Manuel Laboy said that the administration’s top priority is safeguarding public health. >File photo
overcomes the coronavirus emergency, Puerto Rico has the potential to boost medical tourism, particularly among patients from the Caribbean, Central America, and the U.S. mainland. Another issue is product availability in supermarkets. Unlike some types of emergencies, supermarkets are not affected because they remain operational and the people are still receiving their social security income and the Supplemental Nutrition Assistance Program (SNAP) benefits, so they are spending. However, the current inventory tax essentially punishes businesses for having greater inventory. That is, the less a business manages to sell, the higher the tax. This measure has been hotly debated previously and, according to Laboy, its elimination is under consideration. Feliciano assured that inventory shortage in this time of need is not currently an issue because the port in Jacksonville is still shipping to the island. Alas, if that port were to close, the situation would be different.
Quarantine Extension Under Talks
Although EO 2020-023 expires on March 30 and, by extension, the lockdown and curfew, the government is considering the possibility of extending the quarantine in favor of preventing further contagion. On Tuesday, March 24, Dr. Segundo Rodríguez, head of the coronavirus task force, said during a radio interview that the team detected a “community pattern” in the infections, which means that some people who have tested positive for COVID-19 do not have recent travel records or have been in contact with travelers. Thus, he informed that the task force might recommend to the governor that she extend the lockdown by an extra two weeks. “We are evaluating the possibility of the addition of two more weeks. When we make the decision, which we still haven’t recommended, I am sure it will be announced immediately,” the doctor said. Feliciano noted that this raises many concerns from the private sector, particularly over possible layoffs and permanent closures stemmed from lack of revenue. “The big concern is that there will be a need to fire people. The amount of people who will be fired is big… There are many people who are suffering during the lockdown process,” he said. In this regard, the economist drew parallels to the financial strain caused by the impact of Hurricane Maria in Sept. 2017, where a plethora of businesses was never able to recover from heavy losses. While the circumstances differ greatly between the aftermath of that storm and the present scenario from coronavirus, a hypothetical extension could nonetheless have dire effects. “The government hasn’t made a decision as to the extension, but this is very worrisome to the private sector. The longer the lockdown is extended, the higher the number of companies that will never reopen. If you recall [Hurricane] Maria, there were myriad companies that never reopened; we don’t want that to happen again,” he said. Feliciano acknowledged the need to prioritize
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public health but stated that there needs to be a balance between that aspect and Puerto Rico’s economy, especially within the greater context of a 14-year-long recession, an astronomical public debt, and an ongoing bankruptcy process held in federal court. The DDEC secretary claimed that this remains a hypothetical scenario while acknowledging its implications. However, he stated that the government is in the process of implementing a series of measures to counter the economic toll on the private sector. One of these includes a request made to the U.S. Small Business Administration to include Puerto Rico in its Economic Injury Disaster Loan (EIDL) program. In any case, he stressed that the primary concern is to curtail the spread of COVID-19. “We have a primary issue here and that is the health of the people of Puerto Rico. Everyone agrees on that. We are putting up a fight to the coronavirus. That is the number one enemy in Puerto Rico and the whole world,” Laboy said, a statement echoed by the governor at a press conference, where she revealed her administration’s economic plan. He added, “we are taking the necessary steps to eradicate that virus, prevent the people from spreading that virus and prevent people from getting infected and until that situation is not controlled… more measures will be taken.” Although the end of the quarantine is near, the secretary said that it would be “speculative” to ponder other measures. Feliciano said that there is a need to identify which jobs can be carried out remotely and
Tourism is one of the hardest-hit sectors in the economy. A limited number of flights are being allowed in, cruises have been suspended and beaches are closed. >Josian E. Bruno Gomez
which companies or industries can slowly begin reintegrating themselves into the economy. Although not all jobs or work models can adopt these practices, the move would provide some relief.
Restaurants may only operate if they offer delivery, carry-out or drive-thru services. Pictured, Alto del Cabro restaurant at Santurce’s La Placita. >Carlos Rivera Giusti
Economic Plan Announced On Monday, March 23, the governor announced a series of measures meant to reduce the economic impact of her executive order. The Financial Oversight and Management Board (FOMB), created by the U.S. Congress to manage the island’s budget, later clarified that they established this initiative in coordination with Vázquez and her team. The plan, which entails an investment of $787 million, includes measures that have a direct impact on the private sector. The government intends to withhold the payment of the Sales & Use tax (IVU by its Spanish acronym) for three months, offer $500 to selfemployed workers, and provide $1,500 to smalland midsize businesses (PyMEs by its Spanish acronym) with no more than 50 employees and who do not qualify for federal aid. In addition, the government has requested leaders in the banking industry to offer 90-day postponements on mortgages, loans, and credit cards, but people must call their respective providers because it is not an automatic process. According to the governor, this will not affect personal or business credit. “The government of Puerto Rico needs to have a series of measures already prepared and wait for the federal package because the measures implemented locally can’t duplicate federal efforts. That is why, if the federal government’s plan is to provide money to all U.S. citizens, the government of Puerto Rico needs to focus on PyMEs, the tourism sector and others to complement the federal package,” Feliciano stated.
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Roundup on
the Federal Gov’t Response to Coronavirus
Congress poised to agree on rescue package
G Rosario Fajardo
rfajardo@wjournalpr.com
@RosarioWJournal
ov. Wanda Vázquez and Resident Commissioner Jenniffer González have been Puerto Rico’s two “point women” in Washington, D.C. as the federal government works on a nearly $2 trillion initiative to fight the coronavirus epidemic and its economic impact on the nation. The governor has been in discussions with the White House—specifically Vice President Mike Pence—and Health and Human Services Secretary Alex Azar, to help ensure that Puerto Rico and the other U.S. territories are included in all federal endeavors against the novel coronavirus COVID-19. “We have their total commitment on whatever help the people of Puerto Rico need, as with the rest of the states and territories,” she has said to reporters. During her televised address on Monday announcing the Puerto Rico government’s $787 million initiative to fight the coronavirus emergency—in addition to the $160 million already authorized—Vázquez mentioned that the local Labor Department will coordinate with the federal government to offer unemployment assistance to those who are self-employed, such as freelancers. “This is important because [unemployment] benefits, in general, do not cover this sector,” she said. “This is war [against the coronavirus]. All of us Puerto Ricans will win this war together,” she added. Meanwhile, the U.S. Congress was continuing negotiations on the nearly $2 trillion coronavirus rescue package. After members of Congress negotiated well past midnight on Monday, White House officials and congressional leaders said Tuesday they were close to a deal.
Lawmakers in Washington DC negotiate on the emergency coronavirus response legislation. >AP/J. Scott Applewhitew
As of press time, though, the U.S. Senate had not voted on the bill. The Associated Press (AP) has provided a summary of the bill’s main components, which aim to provide healthcare and economic aid amid the coronavirus epidemic and national shutdown. The details are subject to change as congressional leaders and the White House continue negotiating the nearly $2 trillion package, AP reported.
As of press time, the highlights so far: One-time checks to Americans
The measure would provide a quick, one-time stipend of about $1,200 per individual, $2,400 for
couples, and $3,000 for family of four. The money would cut off at higher income levels.
Paycheck support
An estimated $350 billion would be provided for small businesses to keep making payroll. Companies with 500 or fewer employees could tap up to $10 million each in forgivable small business loans to keep paychecks flowing. The program would provide eight weeks of assistance through federally-guaranteed loans qualifying employers who maintain payroll; if they do, other costs like mortgage interest, rent and utilities would be forgiven.
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Gov. Wanda Vázquez >Carlos Rivera Giusti
Unemployment expansion
Establishes a new, much more generous unemployment benefit by adding $600 per week to normal state benefits for up to four months and provides an additional 13 weeks of benefits to 39 weeks of regular unemployment insurance through the end of 2020 if they are sidelined by the outbreak. The coverage would be retroactive to Jan. 27. Extends coverage to “gig” workers and independent contractors.
Emergency funding, public health
The bill includes an additional $242 billion in emergency appropriations to fight the virus and shore up for safety net programs. That includes money for food stamps, child nutrition, hospitals, the Centers for Disease Control and public health and transportation agencies. The figure has gone significantly higher during talks over the weekend. The measure includes $15.6 billion to augment the food stamp program, which helps feed around 40 million low income people per year. Its annual budget is around $70 billion. A bipartisan package is likely to provide far more.
Industry aid
The initial GOP plan called for $208 billion in loans to larger businesses like airlines, which would have to be repaid, and a subsequent version released over the weekend called for $500 billion. Leaders are still negotiating the final number, how the money would be provided by the administration and safeguards to prevent abuses. Delays payroll tax payments by employers. They would be able to defer payment of their 2020 payroll taxes until 2021 and 2022.
State aid
Republicans and the Trump administration have resisted demands by Democrats and governors for
aid to the states, whose governors have requested $150 billion to shore up budgets strained by large new costs and plummeting tax revenues. Negotiations are likely to produce a compromise, AP said.
First round of federal gov’t emergency funding
vaccines, therapeutics and diagnostics to be used if deemed necessary by the HHS Secretary; and $100 million for the Health Resources and Services Administration for grants to improve healthcare to people who are geographically isolated and economically or medically vulnerable. o $1.9 billion for the Centers for Disease Control and Prevention (CDC), which includes $950 million for state and local response efforts, of which $475 million must be allocated within 30 days of the enactment of the bill, and $300 million for the replenishment of the Infectious Diseases Rapid Response Reserve Fund, which supports U.S. efforts to respond to an infectious disease emergency. o $836 million for the National Institute of Allergy and Infectious Diseases, which conducts research on therapies, vaccines, diagnostics and other health technologies, at the National Institutes of Health. o $61 million for the Food and Drug Administration for the development and review of vaccines, therapeutics, medical devices and countermeasures, addressing potential supply chain interruptions and supporting enforcement of counterfeit products. The U.S. Small Business Administration was granted $20 million for its disaster loans program to support loan subsidies that will be made available to entities financially impacted as a result of the coronavirus. Puerto Rico businesses are eligible for this program. The bill also includes a waiver removing restrictions on Medicare providers allowing them to offer telehealth services to beneficiaries regardless of whether the beneficiary is in a rural community, at an estimated cost of $500 million.
The federal government issued the first round SBA’s other efforts of emergency funding related to the coronavirus In addition to the aforementioned $20 million epidemic earlier this month. emergency finding, the SBA is offering designated The Kaiser Family Foundation (KFF) provides this states and territories low-interest federal disaster summary on the main contents of the initiative: loans for working capital to small businesses The Coronavirus Preparedness and Response suffering substantial economic injury as a result of Supplemental Appropriations Act, which passed COVID-19. with near unanimous support in The SBA’s Economic Injury both the House and Senate, was Disaster Loans offer up to signed into law by President Trump $2 million in assistance and on March 6. The bill provides economic support to small $8.3 billion in emergency funding businesses and nonprofits. for federal agencies to respond “The loans may be used to pay The U.S. Small to the coronavirus outbreak. Of fixed debts, payroll, accounts Business Administrathe $8.3 billion, $6.7 billion (81 tion’s Economic Injury Dipayable and other bills that saster Loans program is percent) is designated for the cannot be paid because of the offering up to $2 million domestic response and $1.6 billion disaster’s impact. The interest in assistance and eco(19 percent) for the international rate is 3.75 percent for small nomic support to small response, according to the KFF. businesses without credit businesses and nonprofavailable elsewhere; businesses its that are suffering subKey highlights on the with credit available elsewhere stantial economic injury are not eligible. The interest rate domestic effort: as a result of COVID-19. for non-profits is 2.75 percent,” Of the $6.7 billion designated said SBA Administrator Jovita for the domestic response: Carranza. The majority ($6.2 billion) is for “The SBA offers loans with the Department of Health and long-term repayments in order to keep payments Human Services (HHS) including: affordable, up to a maximum of 30 years. Terms o $3.4 billion for the Office of the Secretary are determined on a case-by-case basis, based – Public Health and Social Services Emergency upon each borrower’s ability to repay,” Carranza Fund, which includes more than $2 billion for the added. Biomedical Advanced Research and Development The SBA’s disaster-assistance customer service Authority for the research and development of number is 1-800-659-2955. Emails can also be sent vaccines, therapeutics and diagnostics; $300 to disastercustomerservice@sba.gov. million in contingency funding for the purchase of
In fact,
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Feedback on Economic Relief Plan
additional equipment for Department of Public Safety employees. THE WEEKLY JOURNAL asked how these purchases would have a direct impact on the local economy, in order to justify their inclusion in an economic relief plan. “What we are doing is acquiring equipment that is needed for certain activities to continue operating… Of course, we are not talking about immediate relief. We are talking about creating the conditions with the necessary equipment to do long-distance education… and for hospitals to continue working amid this emergency,” Lara replied.
Economist Juan Lara discusses measures to help workers and businesses amid COVID-19 emergency
O Giovanna Garofalo
ggarofalo@wjournalpr.com
@giopgarofalo
n March 23, Puerto Rico Governor Wanda Vázquez announced a financial plan meant to mitigate the negative economic impact caused by the islandwide governmentissued lockdown that was implemented on March 15 to fight the coronavirus (COVID-19) emergency. The state government will distribute $787 million to provide support for all those fighting the infection on the frontline or are affected by the emergency measures contained in Executive Order 2020-023, which include a lockdown on many types of businesses and a curfew from 9 p.m. to 5 a.m. until March 30, unless extended. Economist Juan Lara discussed with THE WEEKLY JOURNAL some of the multiple incentives encompassed in this economic relief plan, which he praised as a necessary step to recover from the financial strain caused by a halt in many operations. A previously overlooked group, self-employed workers, will receive $500, for a total $100 million investment. Lara affirmed that this is the right move because the government needs to “put money in the hands of people who have spent two weeks without receiving any income.” However, he acknowledged that $500 isn’t enough money to cover all necessary expenses, especially if the administration decides to extend the lockdown for two more weeks—a measure that is already under consideration. “What we have to think is that this plan is not something set in stone, that this will evolve as the crisis evolves, and that a measure like that can be extended if [the quarantine] were extended for two more weeks, which I believe that they are going to do because now we are really starting to see a rise in cases,” he said. This initiative is similar to another already provided by the Department of Labor and Human Resources, a benefit of up to $190 weekly to
Several Problems Could Arise
Gov. Wanda Vázquez announced a $787 million plan to aid workers and businesses affected by the emergency measures. >Carlos Rivera Giusti
people whose work has been affected by the emergency. A problem is that both of these measures exclude workers who have not been in their current job or with their employer for less than six months. Lara said that these workers should receive the same benefits. “The criteria here should be the needs of any person who has spent two weeks in their home without generating any income and soon won’t have money to buy food. There should definitely be relief and support available to all who need them,” the economist said. Lara pointed out that the U.S. Congress is presently debating a bill that would provide financial relief to the nation’s citizens. If it were to be approved, this would represent a considerable boost to Puerto Ricans who have been affected by this crisis. Meanwhile, the government will invest $70 million in purchasing technology equipment for teachers and students, hospital equipment to handle the COVID-19 emergency and
While this plan provides some relief to strained workers and businesses, some of its measures entail a series of problems in the near future. For example, the Sales and Use tax (IVU) will be suspended for three months in order to increase people’s spending. Considering that a portion of IVU collections is used to finance government agencies or utilities, this means that some public services could be affected unless changes are made to the fiscal plan. This, however, means that other areas would be impacted as well. “This means that the budget cuts contemplated in the fiscal plan will have to be reviewed and if we had thought that we were going to balance the budget three years from now, to give an example, it may now have to be balanced from here to five or six years,” Lara said. Another issue could stem from the 90-day moratorium established on mortgages, credit cards and loan payments. According to Lara, there needs to be a collaboration between banks and the local and federal governments to avoid forcing beneficiaries of this moratorium to pay all their debts at once. “That would be a nightmare for banks because it would mean having to face an avalanche of bad loans in one hit. They need to work on that,” he said. Meanwhile, the $20 million assigned to purchase tablets and computers for teachers and students needs to be accompanied by thorough logistics. The Department of Education needs to identify which students and educators don’t have this technology and which ones don’t have internet access in their homes. “Truth is, I don’t know how they will be able to identify which students need help out of all the children we have in the school system. The idea of providing that aid is correct; the logistics of doing it won’t be easy,” Lara opined.
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Puerto Rico is eager to welcome tourists to the island “when the time is right.” >Courtesy PRTC
Travel Industry Reeling from Coronavirus Puerto Rico tourism looks forward to recovery
T Rosario Fajardo
rfajardo@wjournalpr.com
@RosarioWJournal
he global travel industry has been hit hard by the coronavirus epidemic and Puerto Rico’s tourism sector is no exception. Puerto Rico had already suffered tourism losses due to the January earthquakes and now, with the islandwide coronavirus lockdown and curfew, economic activity has dropped dramatically, with the travel industry among the biggest hit. A source told THE WEEKLY JOURNAL that some hotels in the San Juan area are operating with just 20 percent occupation rates. This should come as no surprise since air travel has come down to a virtual halt, while cruise companies such as Carnival, Holland America and Norwegian have canceled cruises around the world until mid-April. According to Discover Puerto Rico, the island’s destination marketing organization (DMO), revenue per available room (RevPAR) on the island fell 34.4 percent the week ending March 14. This figure is higher than the U.S. average of 32.5 percent, the DMO reported. RevPAR measures hotel performance and is generally calculated by multiplying a hotel’s average daily room rate by its occupation rate. “Puerto Rico’s over indexing on falling RevPAR is attributable to more luxury and upper upscale
properties than the U.S. average. In the last two weeks, these have been the hardest hit hotel segments,” Discover Puerto Rico said in a statement. Brad Dean, the DMO’s CEO, also noted that consumer confidence in the travel industry is falling. “Consumer behavior and sentiment is fast moving. In less than a week’s time, more consumers have moved to cancel rather than postpone travel. As of March 15, 52.5 percent of travelers believed the situation would be resolved by the summer travel season. This has fallen to 37.5 percent a week later,” he said. “The strong measures and abundance of caution being exercised in Puerto Rico is an opportunity to instill confidence in how the destination is handling the situation and how serious it is taking the wellbeing of residents and visitors,” he added. As such, Discover Puerto Rico and the Puerto Rico Tourism Company (PRTC) are looking toward the future when the coronavirus emergency is over and visitors start returning to the island. Both entities are sending the message via social media and other media channels, to “encourage travelers to dream about our beautiful island so that Puerto Rico remains top of mind,” Dean said. The same is being done with meeting planners and other groups, he added. Meanwhile, the PRTC is encouraging tourists to come to the island “when the time is right” and will give visitors a complimentary experience upon their arrival.
“We want guests visiting Puerto Rico during this time to know that we realize that this global health emergency has put a dent in their travel plans, and that our priority is to keep our residents and visitors healthy and safe,” said Carla Campos, executive director of the PRTC. “The World Tourism Organization calls for responsible travel at this time, and in Puerto Rico we are encouraging responsible travel by inviting visitors to comply with the terms of the lockdown and helping be part of the solution. By staying home or in your hotel room today, we will all be able to travel tomorrow,” she said. As part of its efforts, the PRTC is offering visitors a complimentary excursion to be used upon their return, to all those who are currently on the island and whose travels have been interrupted by the local measures put in place. “This proactive outreach will simultaneously provide economic relief to small and medium-sized tourism businesses, which will undoubtedly be impacted by the lockdown,” Campos added. “We regret that during this global health emergency the destination is unable to showcase all the richness and diversity it has to offer and that many visitors have had to cut their trips short. We want visitors to know that Puerto Rico is at the forefront of global recovery efforts, and that these aggressive measures will ensure that the destination will once again be open for tourism in record breaking time,” she said.
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several similarities to this one. Many businesses, especially the ones in the services, hospitality and entertainment industries, profoundly suffered. Businesses that specialized in health care products experienced an increase in revenues. But the most important lesson was the lasting effect on the economy by the dramatic increase of poverty levels which rose by almost 10% in the United States. The notable increase in social and economic separation had a lasting negative effect. These separations will only worsen if legislators begin to include populist ideas, driven by politics, that will seriously affect the survival of many businesses. These misguided ideas, like forcing the private sector to continue carry the load, will lead to businesses choosing bankruptcy. This will ultimately lead to more mass firings, augmenting the economic gap and eventually creating social chaos. As one of the 99.7% small business owners in Puerto Rico, I am horrified by these ill-advised ideas that aim to impress the general electorate and play politics. This legislation are being introduced and reintroduced while seriously putting at peril the businesses that serve as the main economic
engine in the Island. If you put all small businesses, OUT OF BUSINESS, you will have accomplished nothing. Panic comes from fear, and fear can never lead reason. I honestly wonder how many times any of our legislators have had to mortgage their own homes in order the make next week’s payroll. Right now, they, should be coming up with ways to help small business owners stay in business. As a business owner, I can tell you, we want to stay in business. We feel personally responsible for the people we employ and their families. Help us take care of our people, our communities and our economy. This is one of those rare times in history when democracy and freedom become counter intuitive and serve in opposition to what befalls on all of us. Being proactive is important but it stops being effective when it is led by fear to the detriment of us all. Should we panic, no…should we understand the seriousness of the situation, yes. This is not the first Pandemic and it will not be the last. To panic is to allow fear to control our future. Let’s learn from history and take steps that allow small businesses (the economies main engines) to survive and eventually thrive.
right around or closely before to its repeal. The repeal is not the only factor CPA to blame for Puerto Rico’s economic woes. There were government closures, predatory lenders, ridiculous infrastructure investments, a lack of infrastructure investments and a number of situations that have placed us in the financial situation we face today. This can be summarized in two words, government mismanagement. Unfortunately, today, as I write this piece, in a world where everyone is quarantined and afraid of the impact 6 US 936, repealed. Yup, questionable lobbying, Section 936 was of COVID-19, ONE of the elephants in that’s how it reads today. repealed and phased out by 2006. the elephant-crowed room is that the However, the debate As a result, Puerto Rico lost. Some government of Puerto Rico and the surrounding Section extremely prominent and successful federal government allowed Section 936 of the U.S. Code, companies moved their operations to 936 to die. and the downfall of the foreign jurisdictions such as Ireland These days we’re hearing all the manufacturing industry in and Singapore, and the result was plant international media outlets and Puerto Rico, has been discussed for the closures and unemployment in Puerto journalists talking about the advantages last 25 years. Rico. We literally allowed American of reactivating the production of generic Section 931 preceded Section 936 jobs to go foreign, for no reason pharmaceuticals and active ingredients and provided tax benefits to U.S. whatsoever. What’s worse, we sent the in Puerto Rico. companies operating in the Philippines manufacturing of essential goods to A large number of generic due to economic disadvantages of foreign jurisdiction which in times of medications and antibiotics are made applicable tax rules. crisis cause significant complication to outside of the United States, and we Section 931 evolved into Section our supply chain. are only paying attention to that when 936 after the 1976 federal tax reform, Clearly, it was the wrong move. The providing benefits to manufacturing United States Treasury Department and we find ourselves in the middle of a pandemic. That is not to say that it is operations in U.S. territories—creating Congress were banking on higher tax not important to allow for production strong economies in these, and ensuring collection and didn’t foresee the loss of in other partner countries, but our that the production of essential goods jobs, thinking they would all return to governments also need to foster the remained within the United States. the mainland. WRONG! Many Americans today would say that’s The debate over 936 and its link to the production of essential products at the perfect deal—quality jobs and U.S. Puerto Rico economy is always wrapped home as well. Adding insult to injury, the production of goods, yet, according to in political debate and everyone blames Chairman of the Financial Oversight experts, Section 936 had the effect of everyone and anyone for the fact that and Management Board (FOMB) just moving Puerto Rico’s economy towards it was repealed, doesn’t exist, shouldn’t recently communicated to President relying on manufacturing and industrial exist, wish it existed and whether it was Trump that Puerto Rico can and should endeavors— specifically pharmaceutical even beneficial to begin with. be a part of the strengthening and and electronics companies. The fact of the matter? Puerto Rico’s securing of the supply chain in the Over the years, and as a result of economy went on a downward spiral
United States due to its manufacturing history, knowledge, capabilities and general culture. The FOMB should have initiated the conversation on these topics a very long time ago—what happened? Who knows? This would have been more effective and financially efficient than the tax dollars that have gone to ineffective lobbying done to accomplish the very same goals. COVID-19 has shown the need for jurisdiction such as Puerto Rico to remain as manufacturing centers for products that are not only necessary, but essential to national security, health and emergency management. The corporate welfare as well as the anti-statehood arguments are obnoxious, ridiculous and dangerous. To those who call it corporate welfare, just look at the quality jobs it creates; to those who think its anti-statehood, just look at how undoubtedly American it would be right now to ensure that the products our people, THE AMERICAN PEOPLE, need were manufactured IN PUERTO RICO. Let’s not look at this as an opportunity, because its not—people are suffering and dying everywhere. Lets look at this responsibly and as a matter of corporate, logistical and national security sense. Manufacturing needs to happen here. Whether that means American Samoa, Guam, or New Jersey, its up to the jurisdictions that are able to provide the most efficient services to the manufacturing companies. But of course, needless to say, my preference is for this manufacturing happens here in “La Isla del Encanto”!
By Ricardo Alvarez-Díaz Architect and enterpreneur
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POLITICAL PROTAGONISM BY FEAR
his is not the first or the last time that humanity has been challenged globally. But, it will only worsen if legislators begin to include populist ideas, in an election year, that will seriously affect the survival of many small businesses.” The dangers presented by the coronavirus are real and frightening. As we begin to understand the health risks and seriousness of the situation, the uncertainty of it all, creates an incredible amount of fear. The negative economic
impact has been swift and merciless. Businesses are closing, unemployment is rising, stock values are plummeting, people are dying. But should we panic? Things look dire now but allowing fear to determine our next steps will only exacerbate the problem. One cannot make sensible decisions looking at an abyss. Fear inhibits long term decision making. We may not know what the future will bring but looking at history can shed some light on what can be done but also on what should NOT be done. When you take a look at the Spanish flu pandemic of 1918, there are
By: Teresita Fuentes
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A CREDIT REPEAL THAT LED TO A HORRIBLE DEAL
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/ Wednesday, March 25, 2020
Rediscovering and Reinventing Traditional Puerto Rican Fare “Life isn’t about finding yourself. Life is about creating yourself.” – George Bernard Shaw
C
Halle Patterson
hef Nivia Villanueva feels that people must learn to reinvent themselves. Returning to the island to take care of her mother, she has rediscovered her roots. “When I came back to the island, I was amazed to discover that 85 percent of the food we eat is shipped in. It was at that moment that I realized I could use my cooking skills to educate visitors and locals about our island’s ingredients and help the farmers.” On the day I joined her, we met at La Plaza del Mercado in Santurce, in front of the avocado sculpture which was designed by Annex Burgos, to celebrate the plaza’s 100th anniversary. La Plaza del Mercado by calle Dos Hermanos, now just referred to as La Placita, was once a farm. This area was called Cangrejos (crabs) because there used to be lots of land crabs scurrying around. In 1876, Pablo Ubarri arrived from the port town of Santurtzi in Spain to help construct the railroad and a steam tramway that connected San Juan to Río Piedras. Because of his work in this area, he was granted the title of Count of Santurce and that is how Santurce got its name. In the early 1900s, this area had huge growth, due to the tramway stop. It became an important urban community and commercial center. People from all over the island used to come to purchase their produce, see professionals and run their errands. That’s how La Placita became the meeting place for people of all walks of life. However, over the years, shopping centers became the norm and this area became mostly known for the bars and restaurants where people enjoy hanging out. The community has been rediscovered in the last ten years and there has been a comeback with the popularity of
In fact, In fact, In fact,
healthy eating and farm-to-table restaurants. “Nowadays, there is a trend of cultivating food the way our grandparents used to,” chef Nivia explained. Chef Nivia took us inside the Placita and began to explain the different types of root vegetables she was going to use to prepare our lunch. “The food on our island is influenced by three cultures. The original habitants, the Taínos, the Spaniards and the African slaves.” After we shopped, she took us home to teach us how to prepare a traditional Puerto Rican lunch. “My grandmother loved to cook,” she told me
Over the years, shopping centers became the norm and this area became mostly known for the bars and restaurants where people enjoy hanging out.
as she mashed plantains in her “pilón” (mortar) to prepare “mofongo.” Inspired by her grandmother Flora, she studied culinary arts at Johnson and Wales University. “I worked at Share Our Strength, Cooking Matters, a nonprofit organization whose mission is to end child hunger in America through food skills and nutrition education.” I do not cook, yet, while I was watching her prepare rum punch, papaya and avocado salad, “asopao de pollo” (chicken stew) and, for dessert, a banana flambé with coconut limber ice cream, I became excited and inspired. If you are interested in learning how to prepare traditional Puerto Rican cuisine and where to find the organic markets, contact her at cookingwithnivia@gmail.com
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/ Wednesday, March 25, 2020
Achú , a Spanish Language Book to Educate Children About COVID-19 Also, NPR launches a comic book in English on the novel virus
W Rosario Fajardo
rfajardo@wjournalpr.com
@RosarioWJournal
ith the world in alarm mode over the coronavirus pandemic, many parents are interested in learning how to speak to their young children about what is happening in their local communities as well as the rest of the world. With Puerto Rico under a lockdown and curfew, many parents want to talk to their children in a truthful, calm and entertaining way. The Puerto Rico Public Health Trust (PRPHT), was given the task of developing the “Achú” activity book, to educate children about the new coronavirus COVID-19. The book was created with the idea of raising awareness in children, in a simple and fun way, of the world’s reality in relation to this disease, which is already considered a pandemic, with nobody exempt from it. “We must protect our children since they can be great carriers of the virus and we must
prevent the possibility of contagion,” explained Dr. José Rodríguez Orengo, acting director of the PRPHT. “Our interest is to have parents, caregivers and educators help us carry this message to children and the general population so that they understand what is happening in the world in relation to COVID-19 and the importance of taking preventive measures,” he assured. Similarly, an activity called “Avoiding the Spread of Germs” was created, ideal for children to do with their parents in these moments of tranquility and social isolation recommended to prevent further spread. “We are facing an unknown epidemic and we must be responsible to ourselves and others, particularly the elderly and immunocompromised people.” Rodríguez said. The “Achú” activity book and the “Gérmenes y Escarcha” activity were developed by a group of public health professionals who work at the Puerto Rico Public Health Trust. Both publications are available on http://www. paralasaludpublica.org. Download the Achú activity book here: https://prsciencetrust.org/libro-achu. Meanwhile, National Public Radio (NPR) has developed its own original comic book in English to teach kids about the coronavirus. Parents, teachers and librarians around the mainland U.S. have been
Our interest is to have parents, caregivers and educators help us carry this message to children, and the general population, so that they understand what is happening in the world in relation to COVID-19. - Dr. José Rodríguez Orengo Acting director, PRPHT
using the comic book as a teaching tool for several weeks now. To download and print the comic book, go to NPR’s Goats and Soda section. You can also log on to https://drive.google.com/ file/d/1PYrKYfOBa4p-azI5z_46KJMbi1FSmL_Y/ view. Directions on how to fold the comic book correctly can be found at https://www.youtube. com/watch?v=Ixqr9e3wCxI.
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/ Wednesday, March 25, 2020
A Few of My Favorite Things
‘Keep calm and carry on’ Rosario Fajardo
rfajardo@wjournalpr.com
@RosarioWJournal
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he coronavirus pandemic has forced millions of people to live under lockdown for weeks at a time. God willing, Puerto Rico’s two-week lockdown and curfew will not be extended—and our lives and economy will soon start
moving again. However, as we enter the second week of this new reality, here a few of my favorite things to help you get through these trying times. Many news outlets have written plenty about their recommendations for streaming content via Netflix, Amazon Prime and Hulu.
My own favorites include “The Night Manager” on Amazon Prime, loosely based on a John le Carré novel. Tom Hiddleston and Hugh Laurie are both delicious in their roles. For le Carré fans, there’s also his classic “The Spy Who Came in From the Cold,” also on Amazon Prime. Other titles available to rent are “Tinker Tailor Soldier Spy,” with a stellar cast that includes Gary Oldman and Colin Firth; “A Most Wanted Man” with Phillip Seymour Hoffman; and “The Little Drummer Girl” with Diane Keaton. I also found some good exercise videos on Amazon Prime: yoga for beginners, step aerobics and the like. Coupled with our elliptical machine in a spare bedroom, I have found the time to move my body while in lockdown. On Netflix, I have succumbed to TV shows that I never watched while they were on air: “The Tudor” starring Jonathan Rhys Meyers; “Madmen” with John Hamm; and the classic “The Twilight Zone,” created by Rod Serling. Tom Hiddleston, center, and the rest of the cast of “The Night Manager” >Courtesy of BBC News
>All photos by Rosario Fajardo
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/ Wednesday, March 25, 2020
“I cannot live without books…” — Thomas Jefferson
Now let’s get to the really fun part. As a bibliophile, I am constantly reading books, often two or three at the same time. Here are some of my recommendations: Just finished: “American Dirt” by Jeanine Cummings. Read what all the brouhaha is about and decide for yourself. What I am reading now: “Nicholas and Alexandra” by Robert K. Massie. This classic on the last of the Romanovs is a more personal account of those turbulent times in Russia than other
books I have read on the last czar and his family. Last year I read “The Romanovs 1613-1918” by Simon Sebag Montefiore, so Massie’s work is a great complement to that tome. “Tudor: The Family Story” by Leanda De Lisle. I have read plenty about King Henry VIII and his fascinating reign, but I never really understood the details of the War of the Roses. This fun history book fills in the gaps of my knowledge in that regard while refreshing my memory on Henry and his six wives. Next up on my reading list: “How to Hide an Empire, A History of the Greater United States,” by
I took organ, piano and guitar lessons as a child. The guitar did not stick with me, but the organ and piano did. I have dusted off my old electronic keyboard and started playing again, to the surprise of my husband. I read that playing an instrument and reading music are good activities for your brain, so this is an added bonus.
Daniel Immerwahr. The work narrates the history of the United States’ colonial empire that includes Puerto Rico, the Philippines, the U.S. Virgin Islands and Guam. I can’t wait to get started. “Americana, A 400-Year History of American Capitalism” by Bhu Srinivasan. Another fun history book, with an economic focus. Highly recommended by The Economist news magazine. “The Plague” by Albert Camus. No need to extol this work by the Nobel prize-winning author. Beyond Books: I have started coloring again, like a little girl. Who knew that adult coloring books could be so fun and relaxing?
I am learning to play the Spanish card game, Brisca, thanks to my husband. He has the upper hand, since he has been playing since he was a kid. Hence, he almost always wins. Other favorites include Scrabble and chess, which I have not really played since college. During these challenging times, it’s important to keep your mind (and body) active beyond streaming content online.
Todos tenemos esperanza. Todos tenemos que responder al Censo 2020. Ser contados ayudará a determinar cómo fondos federales son asignados a Puerto Rico. Fondos que podrían mejorar la economía, la salud, la infraestructura y la educación. Si todos respondemos, contribuimos a un mejor futuro. Personal del censo visitará tu hogar para entregarte el cuestionario del censo 2020. Conoce más en 2020CENSUS.GOV/es Pagado por la Oficina del Censo de los Estados Unidos