Puerto Rico Economic Forecast
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Of countries in the Caribbean region, Puerto Rico is considered as one of the most diverse. While the agriculture sector has been important to this country’s economy, today both the services and industrial sectors are considered the key to a strong economic position. In addition, Puerto Rico’s economy does well because of tax incentives and duty free access to the United States and heavy foreign investment from companies in the United States.
Of countries in the Caribbean region, Puerto Rico is considered as one of the most diverse. While the agriculture sector has been important to this country’s economy, today both the services and industrial sectors are considered the key to a strong economic position. In addition, Puerto Rico’s economy does well because of tax incentives and duty free access to the United States and heavy foreign investment from companies in the United States.
Along with production of sugar, dairy, and livestock, tourism is another huge factor that has contributed to Puerto Rico’s thriving economy. With this being a tropical island, it has quickly become a favorite hot spot for travelers wanting a relaxing vacation. In fact, in 2007 alone, country officials estimated that almost 6 million people traveled to Puerto Rico on vacation. Although this country has faced a few challenges associated with the global financial crisis along with the rest of the world it remains strong economically while experiencing GDP growth.
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Puerto Rico GDP Forecast
According to 2009 reports, this country’s public debt has grown faster than the economy has grown. By 2008, debt had reached more than $46 billion in US dollars. To resolve the problem, in 2009 the Governor of Puerto Rico took a number of measures to eliminate the $3.3 billion deficit belonging to the government. The result has been positive although more work is still required. In looking at the Puerto Rico GDP (Gross Domestic Product, Current Prices, US Dollars), reports show that in 2008, numbers reached $88 billion in US currency. At that time, the country was in the midst of dealing with the worldwide financial crisis, resulting in the 2.5% decline. Then for the GDP per capita, 2008 was at $18,400, with 54% going toward the services sector, 45% toward industry, and just 1% for agriculture.
Puerto Rico Unemployment Forecast
Today, the Puerto Rico population is just under 4 million, making this one of the most densely populated islands on the planet, with most people being citizens of the United States. Of the people living on this island, approximately 1.3 million work. Even with extensive work opportunities and a sound economy, it is estimated that around 40% still live below the international poverty line. This means that even with good conditions, the Puerto Rico unemployment rate is around 12%. People working in Puerto Rico are paid on average $8.08 per hour although the minimum hourly wage is $3.61. Interestingly, the way in which the level of poverty is determined for this country is unique. Poverty guidelines are issued in the Federal Register each year, being based on $15,670 annually for a family of three or $18,850 annually for a family of four.
Puerto Rico Inflation Rate Forecast
Current numbers for the Puerto Rico inflation rate are difficult to find but in looking back at 2003, numbers were at 6.5%. By 2005, the inflation rate had dropped to 3.8%. For experts to come up with current data, the annual percentage change in consumer prices is compared with the same prices for the prior year. With the sales tax for Puerto Rico being at 5.5% and municipalities having the option of adding on an additional 1.5% sales tax, coupled with the government doing what it can to reduce the deficit, experts believe the inflation rate will continue to drop over time.
Puerto Rico Current Account Balance Forecast
Another aspect of the economy is the Puerto Rico current account balance but like inflation, numbers for this are extremely difficult to find at this time. As mentioned, the government has taken important steps to reduce the government’s debt. The most recent numbers show expenditures are around $9.6 billion in US dollars with revenue being just $6.7 billion. Therefore, it is easy to demise that the account balance will need time to balance out but experts believe changes made will help.
