Puerto Rico says it will default on some bonds

Puerto Rico has been in an economic decline for nearly a decade and its government is struggling with $72 billion in public debt that Garcia has said is unpayable and needs restructuring.

Garcia has stressed that the government’s priority is to maintain operation of basic services such as schools, hospitals and police stations.

“Puerto Rico is at a dead end, shifting funds from one creditor to pay another and diverting money from already-depleted pension funds to pay both current bills and debt service,” it said.

While Puerto Rico is still pursuing access to a bankruptcy mechanism, U.S. House Speaker Paul Ryan, R-Wis., has pledged that the House will come up with “a responsible solution” for Puerto Rico’s debt problems next year.

The government has already increased taxes, closed schools, withheld tax returns and taken other numerous measures to cut costs and generate more revenue amid a worsening economic crisis.

The island’s heavily indebted public power company reached a separate debt-restructuring deal earlier this month with its creditors that forgives a portion of its $9 billion debt and would boost its liquidity.