San Juan, Puerto Rico – A global commercial war is offering Puerto Rico Hope as the territory of the United States tries to strengthen its fragile economy.
Government officials are climbing airplanes to try to convince international companies to relocate their manufacturing plants on the island, where they would be exempt from tariffs.
Any relocation would be an impulse to the unstable economy of Puerto Rico as the government comes out of A historical bankruptcy And he continues to fight with chronic energy cuts. The island is also preparing for potentially large cuts in federal funds under the administration of US President Donald Trump, with federal funds that currently represent more than half of the Puerto Rico budget.
“The problem of the rate is controversial, but for Puerto Rico, it is a great opportunity,” said Governor Jenniffer González.
The manufacture remains the largest industry on the island, which represents almost half of its gross domestic product. But the government wants to recover the apogee of Puerto Rico, when dozens of renowned companies, especially in the pharmaceutical sector, were based here and maintained the economy buzzing.
Until now, officials have identified between 75 and 100 companies that could consider relocating operations in Puerto Rico given the current commercial war, she said Woger Nieves, CEO of Invest Puerto Rico, a public-private association that promotes the island as a business and investment destination.
Companies identified work in sectors such as aerospace, pharmaceuticals and medical devices.
The officials have also welcomed Puerto Rico selectors and organized tours to show them the island’s available infrastructure and emphasize how tariffs would not apply here.
“This is the time to plant those seeds,” said Woger Nieves.
She said that research officials Puerto Rico and several government agencies are expected to make almost 20 more trips this year in an attempt to attract more manufacturing to the island. The Government praised an executive order that Trump signed on Monday that aims to reduce the time to approve the construction of pharmaceutical manufacturing facilities in the United States.
In mid -1900, Needlework was one of the largest industries in Puerto Rico, which employs some 7,000 workers who worked in scarves, underwear, colonca and other items, according to a 1934 fair competition code signed by President Theodore Roosevelt.
The manufacture then changed to chemical, clothing and electronics. At the end of the 1970s, a growing number of pharmaceutical companies began to transfer their operations to Puerto Rico, attracted by a federal fiscal incentive created in 1976 to help boost the economic growth of the island. However, in 1996, the United States government began eliminating the elimination of the incentive, which exempts the subsidiaries of US companies operating in Puerto Rico from federal taxes on local profits.
From 1995 to 2005, employment in general manufacturing fell by almost 30%, but employment in the sectors of pharmaceutical products, medications and chemicals increased by at least 10%, according to the United States labor statistics office.
Puerto Rico continues to lead US exports of pharmaceutical and medicine manufacturing, which represents almost 20% of total US exports in 2020, according to the office.
In 2024, the Island exported almost $ 25 billion in goods, including $ 11 billion in vaccines and certain cultures; Packaged medications worth $ 7 billion; $ 1 billion in hormones; $ 984 million in orthopedic articles; and $ 625 million in medical instruments, according to the Observatory of Economic Complexity.
Sergio Marxuach, policy director and general advisor to the center for a new economy, a group of non -profit and non -partisan experts, said the impulse to attract more companies makes sense, especially recruiting those of the sectors of pharmaceutical and doctors devices.
“If I was advising the government, start there because you already have a footprint,” he said.
Marxuach said that outside those areas, Puerto Rico could have an advantage when it comes to national defense and security contracts, including the manufacture of drones or underwater surveillance systems.
“They need a place to manufacture on scale,” he said, adding that doing so in an American jurisdiction is key.
The Government of Puerto Rico is also meeting with university officials to potentially change the curricula if necessary to ensure that students graduate with the skills required by companies.
Puerto Rico promotes its US jurisdiction, tax incentives and the qualified workforce as reasons why international companies must move to the island.
But he cannot escape his well -known energy problems.
Chronic energy cuts continue to affect Puerto Rico, with two blackouts throughout the island occurring December 31 and April 16.
The crews are still repairing the electricity grid after it was razed by Hurricane Maria In September 2017, a powerful category 4 storm. But the grid was already fragile after the lack of maintenance and investment for decades.
“Puerto Rico needs more reliable energy for economic growth to improve,” said Robert F. Mujica, executive director of a Federal Control Board that supervises the finance of the island.
Woger Nieves, the CEO of Invest Puerto Rico, said that when officials meet with the company’s leaders, they explain the state of the island’s energy infrastructure and offer alternatives, including cogeneration and renewable energies.
“Power does not necessarily have to be an impediment,” he said.
Marxuach, with the center of a new economy, said that Puerto Rico’s energy system is expensive and inefficient, and noted that alternatives can be expensive.
“Puerto Rico has to address some problems that really create additional costs for investors to come here,” he said.
One of those costs is that any product sent to the United States from Puerto Rico must be sent by law aboard a ship with part of the United States with an American team.
Other challenges remain.
Currently, the short -term reaction of many CEOs and companies “is basically waiting and seeing” how the War Tarifa develops, said Marxuach.
Trump has said he wants to keep some rates in place, but has also mentioned efforts to reach agreements with commercial partners. His team said Trump is Use “strategic uncertainty” for its advantage.
Another dilemma is that the relocation of operations has been, not months, and other countries are also competing for the attention of international companies.
“We are competing with Vietnam, South Korea, Malaysia, Singapore, who already have very advanced manufacturing facilities,” said Marxuach. “It is not a dump.”
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