Manufacturers conduct virtual caucus with gov’t officials to address economic development concerns
By Pedro Correa Henry
Special to The Star
After hurricanes Irma and Maria in 2017 and the earthquakes that shook the south of Puerto Rico in 2020, and amid the current coronavirus pandemic, the private business sector still seeks answers from the island government on how they will work together for a better economic system.
With the objective of developing more efficiency, aligning strategies and transforming the island’s economy after the challenges faced in the previous four-year term, the Puerto Rico Manufacturers Association (AIPR by its Spanish initials) will hold a virtual caucus with the new government administration to address its concerns on Thursday starting at 9 a.m. and with plans to broadcast on WAPA Televisión (channel 4).
The virtual caucus consists of a five-hour online event in which AIPR members and private business leaders will come together to address critical issues with high government officials, coordinate efforts, and develop solutions to Puerto Rico’s most pressing challenges.
AIPR President Carlos Rodríguez said he expects that the caucus will allow the incoming administration “to see from the private sector that the government should transform themselves into a facilitator that they have never been.”
“Our intention is that the government listens to our recommendations so they can turn into facilitators, instead of being obstacles which, as of right now, the majority of the government agencies have been,” Rodríguez told the STAR. “Unfortunately, this has caused problems in having sustainable economic development, from issues such as [obtaining] permits, transparency, and agility in processes.”
Gov. Pedro Pierluisi, Resident Commissioner Jenniffer González Colón, and Financial Management and Oversight Board (FOMB) Executive Director Natalie Jaresko are among the guests who will have the opportunity to present their work plans for the island. Also, 13 government agency chiefs related to Puerto Rico’s economic development will be participating in the event.
Among the participating government agencies are the Economic Development and Commerce Department, Puerto Rico Fiscal Agency and Financial Advisory Authority, Natural and Environmental Resources Department, Puerto Rico Aqueduct and Sewer Authority, General Services Administration, Ports Authority, Labor and Human Resources Department, State Insurance Fund, Treasury Department, Health Department, Puerto Rico Electric Power Authority (PREPA), Puerto Rico Energy Bureau (PREB), and the island Housing Department.
‘The relevance that this event has is that it will allow us to listen to their plans and give them input in order to align efforts toward economic development,” the AIPR president said. “In the case of PREPA, our intention is to listen to how they intend to enforce their plan to ensure that they’re implementing the conditions that sustain Act 17 of 2019 appropriately.”
“Right now, we know the law, and we don’t see PREPA’s actions as being aligned with reaching fulfillment with Act 17,” Rodríguez said. “Therefore, we want to understand, first, why their actions are not aligned and, second, what they will do to achieve 100% renewable energy in 2050.”
The STAR asked if this could mean that AIPR associates would raise questions on the current contract awarded to LUMA Energy to operate PREPA’s transmission and distribution (T&D) system for 15 years, Rodríguez said the issue will be part of the conversation, although it is not the first time that the organization has spoken about it.
“We have been for months, even before the contract was authorized, we have been in constant meetings with the [Puerto Rico Energy] Bureau, with the FOMB, with PREPA, in a dialogue to understand the implications of this contract,” he said. “What we are questioning is how did we end up here; in other words, its process.”
Furthermore, although Rodríguez was quick to point out that the AIPR is not against LUMA Energy being the enterprise that was awarded the T&D contract, he said administrative process hearings were supposed to have been held in which the PREB would have summoned the private sector to have an audience during the selection process.
“We believe that LUMA Energy’s contract is not well written; it’s very biased for them, versus for the benefit of Puerto Rico, and that worries us,” Rodríguez said. “They are supposed to have been measured by metrics that are not specified yet; they tell us they are going to put them on the road, but if you have similar [electric power] companies in the U.S. that definitely have established and recognized metrics, why not start with those?”
Rodríguez likewise told the STAR that topics such as the labor reform and proposals to raise the minimum wage on the island are “latent” and pending discussion with Labor Secretary Carlos Rivera Santiago as “changes with either the reform or the minimum wage will or can negatively affect economic development and jobs in Puerto Rico.”
“Similarly, we also have conversations pending on how [Economic Development and Commerce Secretary-designate Manuel] Cidre is planning to implement the incentives that have been approved [to assist local businesses during the coronavirus pandemic], what plans are being made to promote the island outside of Puerto Rico, and to work on permitting issues, which are the ones that delay the startup of businesses in Puerto Rico,” the AIPR chairman said.
Other issues such as federal funding assistance for businesses, the privatization plan for airports and air cargo flexibility, dock infrastructure, upcoming public housing projects, labor laws and minimum wage, water reserves, the future of Act 154 and incentives for businesses and government procurement are expected to be under discussion.
With the next Atlantic hurricane season a little over three months away, tension is rising as the island is still in recovery mode. The STAR asked Rodríguez if there will be conversations during the virtual caucus that address whether the government is preparing for future emergencies.
“The government is definitely unskilled in the use of federal funds,” Rodríguez said. “Historically, we have the largest amount of federal funds assigned to fix the country’s infrastructure and they are still flip-flopping with the use of the funds.”
“The plans to restore the [electric power] grid, the PREB recently turned them back to FEMA and PREPA, indicating that they were not aligned with Act 17, so there is a great concern that the use of funds for improvements will continue to lag behind and we will continue to suffer catastrophic events such as we have experienced up to now,” he added.