Over the past year, Puerto Rico has been in the headlines for all the wrong reasons. Its current economic crisis, which has been developing and worsening for the past 10 years, has much of the island in despair. According to the Pew Research Center, Puerto Rico’s population has decreased every year since 2006, taking the country’s economy along with it (data from the same study suggests its gross national product has declined 13 percent since 2006). However, there seems to be a silver lining. The financial crisis has turned the culinary scene up on its head — but not for the reasons you might think.
Yareli Manning, owner of San Juan food truck the Meatball Company and co-founder of the organization Food Truck Republic, is emblematic of Puerto Rico’s changing economy. Manning traded her life as a business consultant for a Fortune 500 company in Houston, Texas to open a food truck and food truck park in Puerto Rico. Inspired by the Austin street food scene, her decision seemed like a no-brainer given the low operational costs. “The food truck seemed like the right way to go,” said Manning. “There are minimal overhead costs and you can get by with few employees.” After an uphill battle to get the necessary permits, loans, and cashing out her 401K, she opened the Meatball Company in 2014, offering customers handcrafted meatballs (chicken, beef, pork, or lamb) served up in various ways: sliders, spaghetti, subs, gyros, as well as daily specials.
For chef Ricardo Anglada, owner of Nam Pla Street Food Co, moving back home after doing his culinary training in New York had always been the plan. After 10 years working in kitchens in NYC, Bahamas, China, and Hong Kong, he came to Puerto Rico in 2014 with one mission: to cook the meals he loved. “I had limited resources and was virtually unknown here in Puerto Rico,” he said. “It was not easy to get financing from banks here and I had a small amount of money saved up, so the low startup costs of a food truck seemed the most feasible for my economic situation at the time.”
Although he was aware of Puerto Rico’s economic problems prior to opening his business, Anglada did not grasp the severity until he came to the island. He opened Nam Pla in February 2015, bringing customers the street food of Vietnam, Thailand, Indonesia, and Singapore. That same year, the government raised its sales and use tax from seven percent to 11.5 percent. The effect? Everything was more expensive and people were spending less. “It was a challenge to meet and exceed the expectations,” Anglada said. “Here in Puerto Rico, there are a lot of great restaurants, but the majority of the Puerto Rican public can’t afford them anymore. People are holding back on spending because we do not know what our future holds. The public is looking for good food and innovative menus at accessible prices.”
Puerto Rico’s economic decline can be traced back to 2006, when Section 936 of the United States Revenue Code came to an end. Section 936 was a federal incentive that granted U.S. corporations partial or full exemptions from federal taxes on income earned in Puerto Rico. The island’s economy depended heavily on these incentives, since the corporations that set up subsidiaries in Puerto Rico provided jobs to a significant amount of the island’s population.
In 1996, Section 936 was repealed, and a 10-year grace period was given to the companies doing business in Puerto Rico to either stay or relocate. It came as no surprise that many companies and subsidiaries decided to close. The result? A huge drop in manufacturing jobs and a spike in the unemployment rate. During President Barack Obama’s administration, the United States kept generating jobs, and this caused unemployed Puerto Ricans to start looking for jobs on the mainland. “During the last 12 years, Puerto Rico has lost around 500,000 to 600,000 people,” said economist Heriberto Martinez.
“In Puerto Rico, just like anywhere in the world, when productive sectors collapse, the country depends on small businesses to jump-start the economy,” added Martinez. The island’s new reality meant that businesses, particularly small businesses, had to adapt to economic climate. The bad news? Statistics show that small businesses are extremely vulnerable to economic recessions. According to the Small Business Administration, close to 66 percent of small businesses will survive their first two years. This same data shows that 50 percent of businesses fail during their first year.
But one of the industries that best adapted to these harsh times was the food industry. Since increasing fixed costs meant many brick-and-mortar establishments were no longer viable, this gave way to a dramatic rise in food trucks.
Slowly but surely, these food trucks have done the unimaginable: reshape the Puerto Rican palate. “I see a desire to get to know alternatives beyond rice and beans,” Manning said. “Food trucks here are able to provide a flexible menu, which allows them to take more risks.” And since most dishes at food trucks are in the $6 to $14 price range, consumers are more willing to try new things and go out of their comfort zone.
“I knew I was going to have problems introducing certain dishes to the Puerto Rican public,” said chef Pedro Padilla, owner of the Il Furgone truck. “That is why I tried to present them in a familiar manner.” With over 10 years in the food industry, Padilla wanted to bring something different to the food truck scene, and Il Furgone’smenu focuses on Italian dishes with a local touch. “I have seen a marked change in the Puerto Rican palate, they are now more willing to try new things,” Padilla said. “In a food truck, you have a direct interaction with your client. It is easier to customize a dish or prepare daily specials. A restaurant does not have this flexibility... When restaurants add specials to their menu, these are typically dishes that have been successful in the past.”
According to Anglada, the Puerto Rican palate isn't as limited to comida criolla as some might believe. "We have great sense of what tastes good," he said. "On the other hand, people are accustomed to eating foods a certain way here. Some customers still ask me if they can have a side order of French fries or fried plantains with their order. I try to win over my clientele with well-known dishes such as dumplings, fried rice, and noodles then move them along to more adventurous eats,” Anglada said, noting that his menu changes daily. “There is only so much food you can prepare. In a way, the food truck forces me to change the menu and I just try to have fun with it.”
Around the world, changes in the food culture has been shaped by millennials and those who seek out different alternatives when dining out — which in turn, pushes the establishments to get creative with their menus. But in Puerto Rico’s case, the nation is seeing a change with the general public, not just the younger demographic. “The move towards the casual can be seen not only here in Puerto Rico, but in the United States as well,” Anglada said. “Chefs like Daniel Humm, co-owner of the three-Michelin-starred Eleven Madison Park and the Nomad, opened the Nomad food truck back in 2016. I would not be surprised if this begins to happen here in Puerto Rico.”
Padilla points outs that many food trucks also have liquor licenses, while others allow diners to BYOB, “further reducing costs for consumers,” he said. Restaurants are hurting from this trend, and sadly, 2017 will see many local restaurants close.
What does this mean for the food scene in Puerto Rico? Only time will tell. But one thing is clear: The rapid evolution of the consumer’s palate will dictate Puerto Rico’s culinary landscape from now on. Food trucks and restaurants alike must reconcile Puerto Rico’s current economic reality with the demands of this emerging public — the challenge will be in continuing to innovate and provide high quality food at affordable prices.
Myriam Ocasio Arana is the founder and editor of Puerto Rico Eats, a blog dedicated to sharing the best places to eat and drink in Puerto Rico. Editor: Erin DeJesus
Two dishes at chef Pedro Padilla's Il Furgone truck, in Guaynabo, Puerto Rico. Photos:
How food trucks reshaped Puerto Rican palates
Traditionally — as in, over the past 25 years — food trucks in Puerto Rico served hamburgers, hot dogs, and tripletas (a cube or skirt steak, ham, and pork sandwich). Puerto Rico is best known around the world for its succulent and highly addictive comida criolla (creole food), and Puerto Ricans tend to gravitate towards items such as rice, beans, stews, pork, plantains, and other staples. That changed in 2012, when a different breed of food trucks — like pioneers Yummy Dumplings and El Ñaqui, driven by the increased costs of opening a brick-and-mortar — began operating. These food trucks threw the old and familiar menus out the window and started introducing new flavors to their customers. Both trucks quickly gathered a cult-like following and their success inspired others to take a chance and start up their own food trucks.
In 2014, there were about 15 food trucks in Puerto Rico who met the new standards. Now, there are around 80 food trucks all over the island — and this number increases monthly. Diners now have everything from ramen and pho at Tako-G, Mexican food at La Chilanguita, gourmet street food at Bluefin, Peruvian food at Perú Rico, wood-fired pizza at Del Romano, Persian food at the Mill Urban Bistro, Mediterranean at Safari Gyros, and Asian comfort food at Bento Box, just to name a few.
These entrepreneurs have done the unimaginable: reshaped the Puerto Rican palate
Puerto Rico's new governor was sworn in Monday, promising an immediate push for statehood in a territory facing a deep economic crisis.
Gov. Ricardo Rossello, 37, proposed several measures aimed at alleviating the crisis shortly after he was sworn in at midnight. Among them is a proposal to hold a referendum that would ask voters whether they prefer statehood or independence. Many have argued that Puerto Rico's political status has contributed to its decade-long crisis that has prompted more than 200,000 people to flee to the U.S. mainland in recent years.
"The United States cannot pretend to be a model of democracy for the world while it discriminates against 3.5 million of its citizens in Puerto Rico, depriving them of their right to political, social and economic equality under the U.S. flag," Rossello said in his inaugural speech, delivered in Spanish. "There is no way to overcome Puerto Rico's crisis given its colonial condition."
The crowd rose to its feet and cheered as Rossello announced that he would fly to Washington, D.C., Monday to back a bill to admit Puerto Rico as the 51st state.
He also said he would soon hold elections to choose two senators and five representatives to Congress and send them to Washington to demand statehood, a strategy used by Tennessee to join the union in the 18th century. The U.S. government has final say on whether Puerto Rico can become a state.
Rossello said he also aims to boost public-private partnerships and use that revenue to save a retirement system that faces a $40 billion deficit and is expected to collapse in less than a year. He pledged to work closely with a federal control board that U.S. Congress created last year to oversee Puerto Rico's finances, and he has said he supports negotiations with creditors to help restructure a public debt of nearly $70 billion.
"Puerto Rico's recovery begins today," said Rossello, a scientist with no political experience and the son of a former governor who also sought statehood for Puerto Rico.
Rossello announced that he has already signed six executive orders, including one to promote bilingual education, another to provide female government employees with the same pay as their male counterparts, and a third ordering agencies to reduce their budgets and contracts for professional services by 10 percent.
He also seeks to privatize services such as the generation of energy, establish an office to oversee and distribute federal funds to cut down on corruption, and to create financial incentives for doctors to boost the number of dwindling specialists.
Thousands of supporters cheered as they clutched umbrellas to protect themselves from a searing sun.
"This is a historic moment for Puerto Rico," said 50-year-old Jose Davila as he waved a large flag from Rossello's pro-statehood New Progressive Party. "He's the hope of our island, he's the hope for statehood, he's the hope for a people that have suffered."
Puerto Ricans have been hit with dozens of new taxes in the past four years and increases in utility bills as former Gov. Alejandro Garcia Padilla aimed to generate more revenue for a government he said was running out of money. Despite those and other measures, the island's government has defaulted on millions of dollars' worth of bond payments and declared a state of emergency at several agencies.
The federal control board has requested a revised fiscal plan that has to be approved by end of January, saying that the one Garcia submitted last year was in part unrealistic and relied too heavily on federal funds. Garcia had refused to submit a revised plan to include austerity measures. Rossello has said he would request an extension of that deadline as well as an extension of a moratorium that expires in February and currently protects Puerto Rico from lawsuits filed by angered creditors.
As supporters streamed early on Monday toward the Capitol building, one yelled out, "Today, a new Puerto Rico begins!" to the cheers of others, including those holding U.S. flags.
Gov. Ricardo Rossello is sworn in at the seaside Capitol in San Juan, Puerto Rico, Monday, Jan. 2, 2017. The U.S. territory is preparing for what many believe will be new austerity measures and a renewed push for statehood to haul the island out of a deep economic crisis. (AP Photo/Danica Coto) DANICA COTO Puerto Rico's new gov promises immediate push for statehood
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