Puerto Rico will miss a $58 million debt payment over the weekend, setting up the American territory for default. The island owes a staggering $72 billion in debt.
“We don’t have the money,” the governor’s chief of staff, Victor Suarez, said at a news conference on Friday. He added that the government still hopes to renegotiate its debts with creditors.
Officially, Puerto Rico has until close of business on Monday to make the payment. Failing to do so sends the territory into default. Puerto Rican officials have made it clear to investors that that’s not an impossible outcome.
Treasury Secretary Jack Lew says there is no federal bailout in the works. The Obama Administration prefers the island goes through bankruptcy protection and restructuring — an avenue that would be closed if the island attained statehood.