As local and international economists warn of the danger of an economic “hurricane” for the United States, The island’s commercial sector leaders maintain that high winds are already starting to appear, they have been forced to reduce working hours for their employees and even they expect small businesses to close.
While the economic challenges from increases due to inflation, fuel prices and the utility rate worsen daily, factors such as lower federal funds and funds for the food assistance program continue to be added. (PAN), which – in the case of Puerto Rico – threatens the sustainability of some businesses.
“What we’re seeing are challenging moments for Puerto Rico’s economic development.”Evan Baez, president of the Retail Trade Association (Acdet), said: “These are situations that we (companies) don’t control. Without a doubt, we have a perfect storm.”
According to the businessman, the historical disbursement of federal stimulus has led to the creation of artificial economic activity that shrinks due to the decrease in these funds, which gradually return to levels prior to the passage of Hurricane Maria.
In turn, he made it clear Reducing the PAN will reduce the purchasing power of the 52% of Puerto Ricans who benefit from the program, disrupting businesses, an effect that will begin to appear this month. Despite the fact that the government asked the United States for a moratorium on cutting the money, Bayes understands that there is no chance of agreeing to it.
“We immediately find ourselves in what is called an abyss in PAN card money. Even when efforts are made, the chances of it being approved are very slim.”
According to the head of Acdet, companies have already had to resort to cost control and operating expenses, but this is still not enough to ensure the solvency of all companies in the country. In addition, he indicated that as part of the expense control measures, the association has started the process of installing solar panels in companies to mitigate the exorbitant increases in electricity.
“We cannot continue to think, on an island that is still bankrupt and suffering from inflation, of continuing to raise the costs of doing business, because that way, unfortunately, the business will not progress. This is a message for the government,” Bayes warned.
You are already feeling the effect
for this part, Francis Santanapresident Small and Medium Enterprises AssociationYes, he said that Sales have already hit the ground running, which could lead to the closure of small businesses and local businesses.
“It doesn’t mean it’s going to affect us, it’s really affecting us,” Santana said, adding, “We will see the closure of many small businesses that will not be able to support themselves.”
The businessman also agreed with Bayes on the negative impact of reducing PAN funds, keeping his hopes out of the government’s actions.
How long can we, as micro-entrepreneurs, survive in the market? If we’re going to speak in figurative terms, we’re already feeling the hurricane’s winds and they’ve already started destroying many businesses,” he emphasized.
The president categorically warned that the repercussions of the economic situation in small and medium-sized companies will begin to appear strongly within two to three months, which recommended businessmen to reduce operating expenses to a minimum.
On the other hand, last week local economists suggested in this newspaper some measures that the government should take to mitigate the impact of a possible “economic hurricane”, among which they highlighted the switch to renewable energy, promoting labor reform and ensuring access to capital for small and medium-sized enterprises. .
secretary Ministry of Economic Development and Trade (DDEC)And the Manuel Cedriconfirmed it The agency is working on three strategies to mitigate and mitigate the economic impact of rising inflation and fuel costs in the commercial sector.
“DDEC is working on three specific strategies. Number one, a very special approach with two energy subsidies programs and the Energy Trust to join the first; Renewable Energy, in turn, hopes to install solar panels in middle-class families’ homes,” said Cedri, who, through the Energy Trust, is hoping to install solar panels in middle-class homes. in small and medium-sized businesses, so that they can reduce the impact of these increases.”
In addition, he noted that through the DDEC’s Employment Development Office, they have organized employment fairs to further stimulate the search for work and, at the same time, continue to take the initiative to preserve the social assistance that people receive, even when they are employed. .
“This is on top of what the DED can do, because it obviously joins the measures that we are working on so that there is more access to capital for small and medium-sized traders, that there is flexibility in permits, that the incentives come in a timely manner. ‘,” the agency chief explained.
Last week, the financial community responded to the warning of Jaime Dimon, CEO of JPMorgan, when he predicted the threat of an “economic hurricane” to the United States, and recommended that all economic sectors prepare for the possibility of a new recession. ..