In the wake of a divisive trade war catalyzed by President Donald Trump’s enforcement of extreme tariffs, Puerto Rico is attempting to use the uncertainty of the current global economy to boost manufacturing. Due to their tax-exempt status for shipments from the mainland United States, many Puerto Rican governmental officials are seeking to convince global leaders to take their business to the territory.
According to Puerto Rican governor Jenniffer González-Colón (NPP, R), “The tariff issue is a controversial one, but for Puerto Rico, it’s a great opportunity.” By locating business officials from pharmaceutical and aerospace industries, Puerto Rican officials are seeking to find ways to bolster their economy and use current volatility as a tool to gain resources and spark growth. According to ABC, “So far, officials have identified between 75 and 100 companies that might consider relocating operations to Puerto Rico given the ongoing trade war.” In this way, Puerto Rico has expanded their outreach in hopes of capturing the current panic of many global companies. Despite competing with other countries such as Vietnam and South Korea, Puerto Rico’s potential economic opportunities reflect the ambition of the territory to use the Trump tariffs to its advantage.
However, tariffs on importation have also presented numerous difficulties to a myriad of Puerto Rican businesses. Last week, González-Colón held a meeting with representatives from the islands to promote a dialogue about these effects. Acknowledging the fluctuations of the market, she said, “Some of these tariffs have come to nothing. Others are increased, then increased again the next day, and on the third day they are eliminated…And, although there is a moratorium on some of them, the reality is that all of this has an impact on Puerto Rico.” While the governor is working to develop a plan of action involving the public and private sectors, immediate losses are already being predicted on a large scale. In fact, the automobile industry in Puerto Rico is expected to lose $400 million. While González-Colón is currently working to lower operating costs, the future looks grim for many Puerto Rican businesses.
While Puerto Rican officials are seeking to capitalize on the Trump tariffs by providing a boon to international businesses, many industries within the islands may suffer as well. Moving forward, the economic future of the islands remains uncertain, with recent actions from the Trump campaign promoting instability in Puerto Rico.
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