Opportunities for Economic Growth in Puerto Rico

Remarks at the Puerto Rico Convention Center, San Juan, Puerto RicoAs prepared for delivery

I am very pleased to be here and to have this opportunity to speak with representatives of Puerto Rico’s business and academic communities.  In my remarks, I will discuss the lessons learned from municipalities in the United States that have faced crises over the years―such as New York City―and what those outcomes might imply for Puerto Rico as it seeks to restore and sustain economic growth.  I will also touch briefly on the Puerto Rico Small Business Survey, a new survey from the New York Fed that focuses on the business performance, financing needs and borrowing experiences of firms across the Island.  As always, what I have to say reflects my own views and not those of the Federal Open Market Committee or the Federal Reserve System.1

My meeting with you today is part of the New York Fed’s continuing efforts to understand what is going on at the grassroots level within our Federal Reserve district.  We plan these trips so we can interact with a diverse group of stakeholders.  These meetings help me get a more complete picture of economic conditions on the Island and a fuller understanding of the major issues and concerns.  This is the third time we have visited Puerto Rico in the past five years.

Yesterday, I met with Governor-elect Rosselló to discuss the transition into his new role and the key challenges for his upcoming term.  I also spent time with members of El Colaboratorio, a shared workspace organized by the Foundation for Puerto Rico.  I attended a roundtable discussion with local businesses and spoke with former and current members of several of the New York Fed’s advisory councils.

Earlier this morning, I met with the heads of a number of financial institutions and the University of Puerto Rico’s interim president, Celeste Freytes.  Following this visit, I will meet with the leadership from Parallel18, an economic development initiative that attracts early-stage, high-potential startups to Puerto Rico.  Finally, I will join the leadership of the Boys and Girls Clubs of Puerto Rico for a discussion on the organization’s initiatives and a site visit to one of the clubs to learn about workforce development programs and youth services.

As we all know, the Commonwealth of Puerto Rico has been through a very rough 10 years.  The economy has been in a long slump that could easily be called a depression.  Residents have endured a terrible drought, periodic blackouts and a fiscal crisis.  I don’t need to elaborate on all of the struggles Puerto Rico continues to face.  The Island has been suffering from a vicious cycle.  As employment declines, people move to the mainland to find jobs.  Accordingly, economic activity and tax revenues decline, forcing the government to raise taxes and cut spending, which further reduces employment and prompts still more residents to move.  At this point, the outlook for anyone who has been living here must be bleak, and it may be hard to imagine this situation turning around anytime soon.  And yet, history tells us that a turnaround, though not inevitable, is indeed achievable. 

Lessons from Past Crises

New York City is probably the most famous example of a municipality that experienced a major fiscal crisis, recovered and is now thriving.  New York City’s experience is viewed, in retrospect, as a major success, and some, including myself, have pointed to it as a hopeful example of what could come to pass in Puerto Rico.  But, there are important caveats to the New York City story and its applicability to the Commonwealth.

Like Puerto Rico, New York City experienced a number of years of both political and economic pain as a result of its fiscal crisis in the 1970s.  On the political side, New York City residents lost a large measure of their ability to chart their own fiscal direction for several years.  Decisions about tax and spending policies were removed from elected city officials.  The Emergency Financial Control Board was empowered to review all fiscal decisions of local officials and demand changes to the city’s budgets.  Part of the city’s tax base was dedicated to bond repayment—essentially handing it over to the city’s creditors.  For 10 years, the city could not access the debt markets without support from the state.

The economic pain was also very real.  More than 70,000 city government workers were cut from the payrolls in 1975 and 1976.  City residents faced dramatic service reductions—fire houses closed, schools and police precincts had fewer resources, and crime continued to rise for many years.

It is also important to note that New York isn’t the only U.S. city that has been through a major fiscal crisis.  Cleveland, Philadelphia, Washington, D.C. and, most recently, Detroit have all struggled to manage their budgets, and all ultimately reached a point when they were unable to pay their bills.  As a result, these cities lost their fiscal autonomy to one degree or another.  In the case of New York City, this turned out relatively well, as the short-run loss of decision-making power led to a strong economic rebound that eventually restored the city’s ability to finance its own choices.

So, is New York City’s experience really all that instructive for Puerto Rico?  With the advantage of hindsight, it now seems almost obvious that New York City’s fiscal crisis was only going to be a detour.  The city’s economy had many fundamental strengths, so it only needed some assistance to get back on track.  Still, it’s worth pointing out that this was by no means clear at the outset the crisis in the mid-1970s.  Then, many commentators looked at New York City and other large cities as outmoded forms of economic activity, unlikely ever to recover.

While we do not have great measures of economic activity for cities, population change is a good indicator of how attractive a place seems to be.  By that measure, New York City at the time was seen to have very poor prospects—the city’s population fell by over 10 percent during the 1970s.  So, New York City’s eventual bright future was far from clear as its fiscal crisis was unfolding.

Of course, not every city that has faced a fiscal crisis has the same track record.  Relative to cities that had similarly grim outlooks, New York City’s rebound has been much stronger.  In Detroit, there are hopeful signs, but it’s too soon to tell how things will turn out.  Both Washington, D.C. and Philadelphia experienced multiple decades of population declines leading up to their crises. These population declines reversed in the 2000s.  Washington, D.C.’s population actually grew over 5 percent between 2000 and 2010, a rate even faster than that of New York City.  Cleveland’s fiscal reforms, on the other hand, were less comprehensive, and the city has never really turned itself around.  Its population in 2010 was less than half the level of 1960.

The different performances across cities reflect the complex interplay of native endowments, economic conditions and fiscal outcomes.  As in Puerto Rico, the fiscal woes of many of our largest cities have been closely related to long-term economic transformations—essentially, changes in the industrial specialization that occurred in those particular places.  In the case of New York City, the transformation was from manufacturing to services, and it took a generation to complete.  The city’s management of that transition was far from perfect, and the fiscal crisis was the major manifestation of that failure.  The institutions set up to respond to the crisis were crucial to ensuring that fiscal policy didn’t continue to amplify the problems associated with the economic transition.  For a city to turn its circumstances around, it must navigate this economic transformation, identify what will define its comparative advantages going forward, and then build anew around those sources of strength.

The Road to Recovery

A successful fiscal reform first requires a regime in which local officials recognize and accept the reality of the changing economic situation, and set spending budgets accordingly.  This part is fairly straightforward, because it produces the simple policy dictum that borrowing—in all its forms—must be strictly limited.  Of course, knowing what to do and actually getting it done are different things, especially when politics are involved.  As a result, the record suggests that it can be extremely helpful to have some kind of independent fiscal monitor in place on an ongoing basis.  It’s important that this monitor be insulated from the direct influence of politics, giving it freedom to deliver objective analysis that may at times be very unpopular.  In Washington, D.C., this took the form of the Office of the Chief Financial Officer; in New York City it is the Independent Budget Office, which is modeled after the Congressional Budget Office.  These monitors have proven invaluable in keeping policymakers and the public informed on budgetary matters, and in providing apolitical expertise to assist in keeping budgets on a sustainable course. 

The second major component is a successful completion of the economic transformation, which is a critical factor for reversing―rather than simply halting―a city’s decline, establishing a virtuous cycle of rising growth and strengthening fiscal outcomes.  New York City had the huge benefit of its comparative advantage in finance—an industry that was poised for sustained growth in the post-fiscal-crisis period of the 1980s through the 2000s.  Still, the city weathered a lot of shocks during that period, including the 9/11 terrorist attacks, the financial crisis and Hurricane Sandy.  It’s also worth pointing out that New York City is still prospering, even though employment in its finance sector has stagnated.  This illustrates the need for cities to continually look for new areas of growth, such as health care, technology, and leisure and hospitality services.

This is why PROMESA (the Puerto Rico Oversight, Management, and Economic Stability Act) emphasizes long-term growth, and why the New York Fed has been focused on identifying impediments to the Commonwealth’s growth.  Since 2012, we have released two major reports and several shorter analyses—most of which appeared in our Liberty Street Economics blog—presenting ideas that, if implemented, might help to make the Island more competitive and reverse its economic decline.  These ideas have ranged from the very narrow and technical to the very broad—from improving the quality of Commonwealth financial reporting to bolstering growth through education and job training to build the Island’s human capital.

Since I’ve identified managing the ongoing economic transformation as a major component of a successful plan for Puerto Rico, let me summarize a few themes on that front.  Most of these feature an important role for the Commonwealth’s government, underscoring the fundamental importance of getting public policy right as a means of restoring economic growth.

First, it is important to reduce the cost of doing business on the Island as a way of encouraging business growth and increasing the demand for labor.  We have put forward many ideas to consider here, ranging from ones targeted at hiring—such as giving Puerto Rico more autonomy over setting its minimum wage policy—to more general ideas like streamlining regulation.  One thing that we’ve repeatedly emphasized is the need to find efficiencies in the Island’s energy industry.  Commercial customers on the Island pay roughly 20 cents per kilowatt hour for electricity—nearly double the mainland average.  Island residents and businesses, as you are well aware, are also burdened with exceptionally high water utility bills.  It is also important to think hard about the supply of labor—the willingness of people to work, and the education and skills that they have to bring to the market.  Labor supply is equally important, but less widely discussed than the demand side of the market.  Labor force participation is lower at all ages in Puerto Rico than on the mainland.  This is a crucial impediment to growth, and addressing it requires innovative policy options.  One idea to address this problem would be to extend the Earned Income Tax Credit to Puerto Rico.  In addition, the structure of the Commonwealth’s tax system creates disincentives to work in the formal sector, and suggests that tax reform could produce a growth dividend as well as a more reliable source of revenue.  On top of the low labor force participation is the well known and deeply concerning high level of out-migration.  In addition to the lack of labor demand, it seems likely that quality-of-life concerns such as high crime rates are playing a role in these decisions.  This underscores the importance of basic public service delivery and is another example of the interplay between fiscal and economic outcomes.

Another important dimension of labor supply involves the skills that workers bring to the market.  Many of these skills are acquired while in school.  Our research indicates that test scores for school-age children on the Island are low, suggesting that there is an opportunity for improvement in the quality of public education.  One clear lesson from recent research in urban and regional economics is that the collective skills of the people living in an area are a critical ingredient for its growth prospects.  Improving the education available to residents can pay large dividends over time.

I know that this list seems long, and none of issues I have raised are easy to address.  Nonetheless, I am confident that Puerto Rico has started on the road to recovery.  In the current environment, it’s hard to see beyond the immediate crisis to a brighter future for Puerto Rico, but that has been said of other places that have come back stronger than ever.  Getting the fiscal situation in order is an important first step.  The factors leading up to the crisis took many years to develop, and history shows that a successful recovery from a crisis also takes time.  It is important to recognize that fact and to stay the course.

Before I conclude, let me briefly discuss our new survey.  Earlier this month, the New York Fed released the Puerto Rico Small Business Survey,which focuses on the business performance, financing needs and borrowing experiences of firms across the Island.  The survey is intended to fill important knowledge gaps and flag potential economic growth opportunities for the Commonwealth.  It was designed with input from partners here in Puerto Rico, and we are very grateful for their cooperation.

Key findings reveal that firms are persevering through Puerto Rico's economic crisis, though a majority reported declining revenues.  Managing cash flow is a top concern, ranking above concerns about rising business costs.  There is significant demand for credit, with the most common reason being the need to meet operating expenses.  For about half of all small firms, credit needs were under $25,000.  Lastly, about 80 percent of firms do not sell online or export their wares or services.  Firms see this as a growth opportunity, ranking programs in support of increasing sales—to the federal government, via online commerce and through exports—as their top training need.  We hope that the survey will provide useful insights into a key economic sector and help inform policy to support Puerto Rico’s recovery.

Thank you for your kind attention.  I would be happy to take a few questions.

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1 Jason Bram, Tony Davis, Andrew Haughwout and Joseph Tracy assisted in preparing these remarks.

William C. Dudley, President and Chief Executive Officer 
Opportunities for Economic Growth in Puerto Rico

Fed’s Dudley Says Puerto Rico Will Regain Access to Bond Market

New York Federal Reserve President William Dudley said heavily indebted Puerto Rico may be able to return to the bond market once it completes a plan to recover from its financial collapse and advised that any borrowing should be “strictly limited.”

Dudley, speaking in San Juan, said the commonwealth needs some big reforms to reverse a prolonged economic slump that could "easily be called a depression." Puerto Rico’s economy has shrunk in the past 10 years, fueling excessive government borrowing that’s sent the island over a fiscal cliff and pushed it into federal financial oversight.

"If the government comes up with a viable fiscal plan that the legislature can adopt, I think Puerto Rico will regain access to the markets," Dudley said in response to audience questions. "It’s viable plan first, some credibility in executing that plan - that’s the key ingredient here."

Puerto Rico’s government has effectively been locked out of the U.S. capital markets, with the worsening crisis pushing it to default on a growing share of its $70 billion debt. It hasn’t sold general-obligation bonds since March 2014, when it borrowed $3.5 billion to cover bills, wagering it would buy time for the economy to revive.

A federal oversight board has been tasked with pulling Puerto Rico out of its crisis and is working on a financial turnaround plan. While departing Governor Alejandro Garcia Padilla turned down a request to incorporate deeper spending cuts in his initial proposal, the board said it will move forward with plans to certify such a blueprint by February, after his successor, Ricardo Rossello, is sworn in. Rossello has pledged to work with the federal board to implement public policy and restart negotiations with bondholders.

Dudley, who isn’t officially involved with the recovery efforts, said successful fiscal reform requires local officials to "recognize and accept the reality of the changing economic situation, and set spending budgets accordingly."

The U.S. policy maker also suggested having an independent fiscal monitor in place "on an ongoing basis" to deliver objective -- and potentially unpopular -- analysis. The rescue law enacted by President Barack Obama in June empowers the federal board to review financial projections and oversee negotiations aimed at cutting the island’s debt.

Using New York’s fiscal crisis in 1970s as an example, the Fed speaker stressed that economic transitions can take a long time to complete.

"For 10 years, the city could not access the debt markets without support from the state," Dudley said. "In the case of New York City, the transformation was from manufacturing to services, and it took a generation."

Puerto Rico’s economy has shrunk by an estimated 16.5 percent since 2007 and is forecast to contract by 2 percent in the year ending June 30, according to the island’s Planning Board. Garcia Padilla’s administration has opted to default on its debt to avoid shutting off services to the island’s 3.5 million residents, nearly half of whom live in poverty.

by Tatiana Darie

Fed’s Dudley Says Puerto Rico Will Regain Access to Bond Market

The Race for a Zika Vaccine

The Zika virus thrives in tropical climates. But it is also growing in this cold-weather city — up a flight of stairs, past a flier for lunchtime yoga and behind a locked door. That is where scientists working in a lab for Takeda, the Japanese drug company, inspect and test vials of the virus.

They are engaged in an all-out race to halt Zika, a disease that has set off worldwide alarm because of its links to severe birth defects. Day and night, these researchers are trying to crack the code to the virus.

“We’re slaves to the cells,” Jeremy Fuchs, a senior researcher at the lab, said.

And they are far from alone. Perhaps never before have so many companies and government organizations worked so quickly to develop a vaccine from scratch. Vaccines usually take a decade or more to develop. But researchers say a Zika vaccine could be available as early as 2018, in what would be a remarkable two-year turnaround.

More than a dozen companies are on the hunt, in addition to government stalwarts like the National Institutes of Health. To get ahead, some teams are employing innovative technologies that rely on splicing DNA, a method that has the potential to revolutionize the development of vaccines but that has never before been approved for use in humans.


The prestige of solving the puzzle and the chance to save lives are possible rewards. For the companies, another motive is the potential for significant profit. Unlike many recent viral outbreaks, which have been confined to poor areas, Zika has spread to countries like Brazil and the United States, with millions of wealthy people and governments that can afford public vaccination campaigns.

“It’s highly unusual,” said Dr. Thomas P. Monath, the chief scientific officer and chief operating officer of NewLink Genetics, one of the companies developing a vaccine. “It reflects the big opportunity and public health need, and also the fact that we have more, different technologies available today.”

But meeting the ambitious timeline is far from guaranteed. To keep the fast pace, some clinical trial organizers are trying to start their tests in South America over the next few months, when Zika infection rates are expected to be at their height there.

The timing is crucial. An outbreak of Zika provides an ideal testing ground for a vaccine, so the preventive medication can be evaluated in a population exposed to the virus. Researchers will know in short order whether the vaccines being tested are effective.

If they miss the window, a vaccine could be delayed for a year or more — a result that could lead to millions more people becoming infected with the virus.



By September, after acrimonious debate and a long delay in Congress, President Obama approved a $1.1 billion spending package to fight the virus. About $400 million of the money will go toward developing a vaccine and diagnostic tests.

The escalation of attention has been remarkable. Identified nearly seven decades ago, Zika was once considered mostly harmless, because about 80 percent of people who are infected show no symptoms.

But about 18 months ago, Brazilian officials began to sound alarms that it was to blame for an otherwise mysterious outbreak of babies born with microcephaly, or unusually small heads and malformed brains. Around the same time, heartbreaking photographs of children born with the condition shot around the globe.

Dr. Barney S. Graham, deputy director of the Vaccine Research Center at the N.I.H, was at a meeting in July 2015 when he learned of the threat. A Brazilian doctor pulled him aside at the meeting in Bethesda, Md., which had been called to discuss chikungunya, another tropical disease.

“I know we’re here about chikungunya,” Dr. Graham said the doctor told him. “But I really want to tell you about Zika virus.”

Within months, the link seemed increasingly clear, and public health officials predicted that the virus would probably infect millions of people. In December, Dr. Anthony S. Fauci, the director of the National Institute of Allergy and Infectious Diseases at the N.I.H., called a meeting with the top members of his vaccine staff.

Similar meetings were occurring elsewhere in the vaccine world — at small companies like Inovio Pharmaceuticals and NewLink, in the offices of big manufacturers like GlaxoSmithKline and Sanofi, and at the Walter Reed Army Institute of Research, which is a few miles from the N.I.H. campus in Bethesda, where Dr. Fauci’s team works.

“I said, all hands on deck,” Dr. Fauci recalled. “We have a serious problem here. We’ve got to really move.”

High Stakes and Confidence

No single person directs an operation as widespread as the race for the Zika vaccine. But Dr. Fauci certainly sits near the center of it and comes with a singular perspective.

An immunologist, Dr. Fauci, 75, has led the National Institute of Allergy and Infectious Diseases for more than three decades, playing a role in nearly every major disease outbreak since the 1980s.

And to hear him tell it, the Zika virus does not stand much of a chance.

“Without being presumptuous, most of us in the field feel that we will get a vaccine for Zika,” Dr. Fauci said recently, his staccato Brooklyn accent underscoring his confidence. “So it’s really a question of what’s the best one, how quickly can you get it, is it safe, and is it scalable?”



But he also knows the stakes.

“For a pregnant woman,” he said, “it’s absolutely devastating in its potential impact.”

His team, and the others chasing a Zika vaccine, started with a couple of big advantages. For one, the economic incentives are clear. The first company to develop an effective vaccine will win a toehold in a market that could ultimately reap billions in profit. And because governments are paying for some of the early development, the financial risk is limited.

Also, the disease belongs to a family of viruses known as flaviviruses, which scientists have been battling for more than a century. Vaccines already exist for some of these viruses, such as yellow fever, Japanese encephalitis and dengue.

Another good sign: Adults infected with Zika seem to fight off the illness on their own, meaning the human body, if given the right tools, already has the resources to defeat it.

The vaccine hunters had several options. The tried-and-true method is what is known as a killed vaccine, in which a dead virus is injected into the body. The body then builds its defense against the virus in a way that also protects against the live version. This is how many vaccines work, including those for polio and the flu.

Several teams, including those at Takeda and one at Walter Reed, chose that path. Walter Reed’s candidate entered early clinical trials in this month. Sanofi has signed on to bring that product to market.

The advantage of the killed vaccines is that they are reliable. Several vaccine specialists said they were confident a Zika vaccine using this method would succeed. The downside is that developing one takes time, sometimes decades.

Other teams, including Dr. Fauci’s scientists at the N.I.H., decided on a newer approach. It involves manufacturing a harmless piece of the virus’s DNA, the molecule that acts like an instruction manual for the body. Once injected, the DNA tells human cells to make Zika proteins. Those proteins then assemble themselves into harmless viruslike particles that trick the body into developing antibodies that can fight the disease if it arrives.

It is a startlingly simple and fast approach. Dr. Fauci’s team created a prototype that it could begin testing in mice within weeks.

“You can jump in right away,” he said.

However, DNA vaccines are largely unproved in humans. While the technology has been approved for animals, none of the vaccines have been approved for humans. A vaccine developed by the N.I.H. to prevent West Nile, another virus related to Zika, succeeded in early trials but never completed trials and was not brought to market because researchers could not find a drug company that was interested.

Part of the reason DNA vaccines are tricky, researchers say, is because the vaccine’s DNA must reach the nucleus of a person’s cells before it can begin instructing them to make Zika proteins. When the vaccine is injected into the body, not all of it reaches the nucleus, lowering its effectiveness.

“It’s a race against nature,” said Michel De Wilde, a vaccine research consultant and former executive at Sanofi, a French vaccine manufacturer.

The virus, spread by mosquitoes and sexual intercourse, has now been reported in more than 70 countries. This summer, it landed in the United States, spreading quickly in Puerto Rico and turning up in Miami. Government officials have advised pregnant women to avoid parts of Miami where the virus is active. In a sign that Zika will be a continuing threat, on Friday the World Health Organization lifted its nine-month emergency declaration and said it would shift to a longer-term effort to combat the virus.

To solve this problem, some companies are trying a similar method that uses RNA, a molecule in the body that is more flexible than DNA. Among the things it can do is carry out, on its own, the instructions contained in DNA. The vaccine would not need to reach a cell’s nucleus to trigger the immune response.

GlaxoSmithKline and Moderna Therapeutics, using government grants, are working on RNA vaccines for Zika that are still in their early stages.

Testing in Zika Zones

If one or more Zika vaccines are successful, it is unclear who would ultimately get them. The medication could be used only during outbreaks, or it could become routine in some parts of the world.

Early trials of the DNA-based vaccine developed by the N.I.H. are underway, and studies have begun in Puerto Rico of a similar vaccine being developed by Inovio.

The next step will be to test the vaccines in a larger pool of people who live where Zika is present. That stage must be intricately set so that the trials occur at just the right moment, at the height of summer in Latin America, which starts in December.

Not a day can be wasted. The N.I.H.’s trial coordinators are setting up trial sites at more than 20 locations in Central and South America. Once the trials begin, the coordinators will monitor local Zika cases, moving resources to sites of outbreaks and away from places where the virus is quiet.

Researchers say they are taking a lesson from the Ebola outbreak of 2014, which also spurred a race for a vaccine. In that case, the outbreak was brought under control before many of the trials could take place.

“All of us felt like we kind of really missed the boat with Ebola,” said Col. Nelson Michael, who is leading the Zika vaccine effort at Walter Reed. “We brought troops too slowly into the fight.”

In a clinic at the University of Maryland School of Medicine in Baltimore in September, several volunteers waited hours in a hallway to be among the first to receive the experimental DNA vaccine being developed by the N.I.H.

Some read college textbooks, others browsed Facebook.

Jen Wenzel, a volunteer and a postdoctoral fellow in neuroscience, said she signed up out of curiosity — and to make extra money. Volunteers are paid as much as $1,600 if they complete the study.

When it was her turn, Ms. Wenzel winced and looked away from the needle about to deliver the vaccine. “Take a deep breath,” said a nurse, who then quickly jabbed the needle into Ms. Wenzel’s arm, making her gasp in surprise.

And with that, Ms. Wenzel became the 29th person at the University of Maryland, and one of only dozens worldwide, to have received a potential Zika vaccine. Over the next two years, she will return to the clinic for follow-up tests to see how well it works.

Of course the researchers chasing a vaccine — and the many millions of people concerned about catching the virus — hope to have an answer long before then.



By KATIE THOMAS
The Race for a Zika Vaccine

Puerto Rico: 2nd baby born with microcephaly due to Zika

Puerto Rico is reporting that a second baby has been born in the U.S. territory with severe defects as a result of a Zika infection.

Health Secretary Ana Rius said Friday that the baby was born this week. She declined to provide any other details. Another four fetuses have been diagnosed with microcephaly but have not yet been born.

Puerto Rico is fighting a Zika epidemic with more than 34,000 cases, including 2,631 pregnant women. Nearly 280 people have been hospitalized.

Five people infected with Zika have died in recent months in Puerto Rico, including two who developed complications from a paralysis condition known as Guillain-Barre.

Puerto Rico: 2nd baby born with microcephaly due to Zika

Puerto Rico Births Projected to Decline

Puerto Rico is expecting about 1,000 fewer babies to be born this year than originally forecast, due in part to the Zika virus, a government official said Thursday.

“Given the introduction of Zika, we had to revise our expected live birth numbers and right now we are expecting a little bit over 27,000, which is about 1,000 less than what we had envisioned,” Brenda Rivera-Garcia, the territory’s epidemiologist, said in an interview following a presentation at the annual meeting of the American Society of Tropical Medicine and Hygiene here.

Birth data offer potential clues about how women of childbearing age across the Americas and beyond are responding to the threat of Zika, a mild virus that can nevertheless cause devastating birth defects in the fetuses of those who become infected while pregnant.

As the mosquito-borne virus has spread rapidly over the past two years through the Western hemisphere, researchers and public health officials have wondered whether women would delay pregnancies or abort their fetuses if they became pregnant.

Dr. Rivera-Garcia, a leader of the Zika response at the Puerto Rico Department of Health, said it isn’t clear how many women on the island are delaying pregnancy or aborting fetuses. The department doesn’t currently have enough staff to track that data, she said.

Since the outbreak began late last year, at least 2,615 pregnant women had been confirmed infected with Zika, according to the Puerto Rico Department of Health. Three babies have been born with Zika-related birth defects.

The total number of babies born has been on the decline in Puerto Rico for several years, as residents of the island territory have moved to the U.S. mainland to escape a crippling economic crisis. The continuing exodus factors into the expected decline in births this year, Dr. Rivera-Garcia said.

There were 34,434 babies born in Puerto Rico in 2014, according to the U.S. Centers for Disease Control and Prevention, and 31,272 babies born in 2015, according to preliminary CDC data.

Questions about how Zika may be affecting birthrates have emerged over the past few months. While more than 2,100 babies in Brazil have been born with confirmed Zika-related birth defects, other countries are reporting far fewer cases. One hypothesis is that women in Brazil were caught off guard by the virus, whose effects on fetuses were unknown until their babies were born.

Women in other countries such as Colombia, where 57 cases have been reported thus far, had advance warning. In addition, abortion is legal in Colombia and some other countries, unlike Brazil.

Puerto Rico, hard hit by Zika, has confirmed 33,455 cases of Zika infection since November 2015. The current epidemic appears to have peaked in late summer.

Tyler Sharp, epidemiologist in the CDC’s dengue branch in Puerto Rico, said in an interview that the CDC still expects 15% to 18% of the island’s population of about 3.5 million to have been infected by the end of this year. That is down from the CDC’s original projection that 25% of the population would be infected by the end of the year.

Most pregnant women in Puerto Rico have been infected in their third trimester, when the risk of birth defects is considered lower. Dr. Rivera-Garcia said. “We still haven’t seen those births from the peak of transmission,” she said. “So it isn’t that we’re not going to see cases, it’s just that we’re not seeing them yet. Whether we’ll see them in the large numbers that other jurisdictions have seen them in, that’s still a big question mark.”

Write to Betsy McKay at betsy.mckay@wsj.com

By BETSY MCKAY

Threat of Zika virus, effects of an economic exodus weigh on island’s forecasts

Puerto Rico Births Projected to Decline

Puerto Rico takes giant leap towards statehood

The American citizens residing in the United States Territory of Puerto Rico took another, major, step towards gaining admission into the Union as the fifty first State with the overwhelming election of nearly all of the New Progressive Party (NPP) candidates to the local legislature, as well as the victory of our candidates for governor, Ricardo Rosselló, and Resident Commissioner, Jenniffer González.

The NPP is an ideology-based political party which advocates for Puerto Rico's statehood. The resounding win of nearly all of the Party’s candidates at the State-level positions send a powerful message to the new Republican leadership in Washington D.C., the time to end more than a century of colonial rule on the Island has come.

The newly reelected Speaker of the House, Paul Ryan (R-Wis.) and the Senate Majority Leader, Mitch McConnell (R-Ky.), have a mandate to promote the admission of Puerto Rico as the new state of the Union.
The Republican Platform, adopted at this summer’s National Convention clearly states that the GOP will respect the will of the people of Puerto Rico, free and democratically expressed in the 2012 status referendum in which 54 percent of the voters rejected the current colonial relationship with the U.S. In that same election, 61 percent of people that participated chose statehood as a final solution to an almost never ending story of our political relation with the nation.

At that time, the will of the people of Puerto Rico was not enacted due to bureaucracy in Congress and efforts made by the soon-to-be ex-governor of the island, Alejandro Garcia Padilla, who refused to enact on the results of the referendum. It’s because this reason, among others, that the voters in Puerto Rico rejected him, and the candidates he supported, at the ballots last Tuesday.

There’s no excuse now to act on that will.

Section 402 of the Puerto Rico Oversight, Management, and Economic Stability Act, better known as ROMESA, paves the way for a federal-backed referendum regarding the admission of Puerto Rico into the Union.

Our newly elected governor, as well as our Resident Commissioner, have constantly stated their intent to submit legislation in Congress as soon as early January, for the admission of the island, in accordance with the 2012 results.

The people have spoken, both in Puerto Rico and in the rest of our nation, now the moment to act has arrived.

Jose Aponte-Hernandez is a state representative in Puerto Rico and is the former Speaker of the House for the territory.
BY JOSE APONTE-HERNANDEZ
Puerto Rico takes giant leap towards statehood

Wichita State University Physician Assistant Alumnus Paves Way For Students To Practice In Puerto Rico

Wichita State University physician assistant (PA) program alumnus Troy Richardson recently completed his eight-week elective clinical rotation in Puerto Rico and helped pave the way for students in the College of Health Professions (CHP) at Wichita State to participate in experiential learning on the island.

Puerto Rico is the only U.S. territory that does not authorize physician assistants to practice. The American Academy of Physician Assistants is working to change this by encouraging passage of legislation which would authorize PAs to provide health services in Puerto Rico that are currently provided only by medical doctors. Richardson, along with PA faculty and staff, worked for six months to complete an affiliation agreement between the CHP and the COSSMA clinic in Puerto Rico.

The agreement provides an opportunity for CHP students at WSU to potentially participate in clinical rotations with the clinic. COSSMA, a Center for Integrated Primary Health Services, is also qualified as a Federally Qualified Health Center clinic.

"The agreement we have with COSSMA is a great opportunity for students to learn health care in a different culture," says Richardson, who now works as a PA at Utah Community Health Centers in Salt Lake City.

Richardson, who previously spent two years in Venezuela on a mission trip, has 16 years of experience speaking fluent Spanish and translating in the health care system.

Kim Darden, physician assistant program director and clinical educator at Wichita State, says Richardson completing his final clinical rotation in Puerto Rico has created unique opportunities for CHP students and the COSSMA clinic.

"I'm proud to report Troy represented himself, WSU, the PA program and the PA profession exceptionally," says Darden. "We're excited about the success of our program in meeting its mission to complete the agreement."

Puerto Rico is in the midst of a health care crisis. Although it is a U.S. territory, the island is in a third-world country situation. The economy began to collapse in 2006 and has been declining ever since. Consequently a large number of medical providers have left the island, leaving many Puerto Ricans unable to receive quality healthcare. Medical resources are scarce, and it can take patients months to get a doctor's appointment, particularly with a specialist. If they are able to get an appointment, people often can't afford the high expense.

The American Academy of Physician Assistants (AAPA) is urging the Puerto Rico Healthcare Crisis Coalition to authorize PAs to practice and help meet the health care needs of the island.

Richardson says his experience with COSSMA was a great opportunity to represent and promote the PA profession in Puerto Rico. He says PAs are the solution to the island's healthcare crisis because they are cost-effective for practices and able to deliver a wide variety of medical services. PAs increase patient's access to care and improve the efficiency of the health care system.

Challenges

Richardson says it was surprising to not have access to many types of medications, equipment and specialty treatment – amenities that are abundant in the U.S.

"It was definitely eye opening to see the challenges firsthand," says Richardson. "But it was good experience because I was able to treat people with a variety of problems including heart conditions, lupus, HIV, kidney disease, liver failure and more."

Richardson says despite financial limitations, COSSMA is one of the only clinics in Puerto Rico that has a number of specialties available such as primary care medicine, OBGYN, a dental clinic, psychiatric services and health education.

During his time in Puerto Rico, Richardson worked with many different providers to talk about education and the role PAs can play to help with the health care crisis. He says he was embraced by the medical community and introduced to representatives from several major health care organizations of Puerto Rico, including the Centers for Disease Control and Prevention, the Healthcare Crisis Coalition and others. His clinical rotation ended with a celebration and a certificate honoring him and his contributions.

"Everyone in Puerto Rico was very receptive and excited for more PA students to come practice," says Richardson. "The trip was an incredible experience."

A photograph is available at http://www.wichita.edu/thisis/wsunews/newsrelease/highres/?pid=7230
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Contact: Kim Darden, physician assistant program director and professor, 316-978-3011 or kim.darden@wichita.edu.

Wichita State University Physician Assistant Alumnus Paves Way For Students To Practice In Puerto Rico