Trump asks Congress for 4.9 billion USD loan to Puerto Rico

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US President Donald Trump asked Congress on Tuesday for a 4.9-billion-US dollar loan to help the cash-strapped Puerto Rican government pay its bills as it struggles to recover from Hurricane Maria, an administration official said.

Puerto Rico Governor Ricardo Rossello had asked for help with lines of credit in late September, saying his government was in a bind and did not expect to have any near-term revenue.

Weighed down by nearly 72 billion US dollars in debt, Puerto Rico struggled with liquidity even before the most powerful hurricane in almost 90 years wiped out the island's power grid, homes, and other infrastructure nearly three weeks ago.

The territory, home to 3.4 million Americans, declared bankruptcy in May.

The community disaster loan proposed by the Trump administration would include a 150-million-US dollar advance, the administration official said, speaking on condition of anonymity. Further details of the loan were not immediately available.

Reuters Photo‍

"The 4.9-billion-US dollar loan would help them with short-term liquidity problems in financing," such as payroll and pensions, the official said. "The money cannot be used for debt service."

On Saturday, Rossello wrote to Trump pleading for a broad assistance package of at least 4.6 billion US dollars through a variety of government programs in what he called a "down payment on hurricane recovery efforts" as the island assesses the damages.

"Absent extraordinary measures to address the halt in economic activity in Puerto Rico, the humanitarian crisis will deepen," Rossello said in the letter, warning the situation could lead to an exodus from the island to the mainland United States.

The Trump administration and Congress have so far focused their funding efforts on immediate disaster relief. The US House of Representatives is expected to this week consider a request for an additional 13 billion US dollars in disaster relief funds for hurricane victims in Puerto Rico, Texas and Florida.

The White House has also asked federal agencies to estimate by October 25 how much money will be needed for longer-term rebuilding after the hurricanes.

Source(s): Reuters