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GOVERNMENT ACCOUNTABILITY OFFICE: Virgin Islands’ Debt Is Higher Than Any Other American Territory

John McCarthy
GOVERNMENT ACCOUNTABILITY OFFICE: Virgin Islands' Debt Is Higher Than Any Other American Territory

FILE - In this June 29, 2015 file photo, U.S. and Puerto Rico flags hang outside the governor’s mansion in Old San Juan, Puerto Rico. Puerto Rico's power company said Wednesday, Sept. 2, 2015 it reached an agreement with a group of bondholders to restructure the troubled agency, providing some relief to investors who believed it soon would go bankrupt. The bondholders hold about 35 percent of the power company's bonds and represents hedge funds and municipal bond investors. (AP Photo/Ricardo Arduengo, File)

GOVERNMENT ACCOUNTABILITY OFFICE: Virgin Islands' Debt Is Higher Than Any Other American Territory

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WASHINGTON — U.S. territories, like states, borrow through financial markets.

The Government Accountability Office (GAO) reviewed the territories’ fiscal year 2005-2015 public debt.

Puerto Rico‘s debt grew to 66 percent of GDP and the territory is now in default. Its financial future is unclear until debt restructuring is complete.

Guam‘s debt increased to 44 percent of GDP. Large unfunded pensions, if unaddressed, may hamper repayment.

The U.S. Virgin Islands‘ debt grew to 72 percent of GDP. It’s uncertain if financial reform will let the territory borrow at favorable rates again.

At 11 percent and 16 percent of GDP, respectively, American Samoa and Northern Mariana Islands had lower debt relative to the size of their economies.

https://www.gao.gov/products/GAO-18-160

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