Hurricane Maria's devastation may have set back Puerto Rico's economy so much that it will now take more than a decade to recover, a prominent economist on the island said.
Puerto Rico's gross national product (GNP) could take 12 to 13 years to regain its pre-recession level, Jose Joaquin Villamil, president of Estudios Tecnicos, a business and economic consulting firm based in San Juan, told local newspaper El Nuevo Dia. Earlier this year he predicted the island's economy would continue to shrink for another eight to 10 years.
Puerto Rico's economic recession began in the spring of 2006.
Villamil also told the newspaper: "It is going to take Puerto Rico a long time to recover from this."
Maria, a Category 4 storm, left most of Puerto Rico's 3.4 million residents without electricity and water and destroyed the homes of thousands. It also took out much of the island's telecommunications infrastructure.
The island's Treasury secretary, Raul Maldonado, spoke with CNBC at the end of last week and said Puerto Rico's situation could get worse without Congress' help.
"The hurricane just drained us," Maldonado said. "The government can't get revenue" because of the infrastructure damages.
"If we don't get the help we need, this will be a national disaster," Maldonado added. "We're not looking for a handout; we're just looking for some help to get back on our feet."
Gov. Ricardo Rossello sent a letter to Congressional leaders on Saturday, asking for $4.6 billion in aid.
In the letter, he said: "We are grateful for the federal emergency assistance that has been provided so far. However, absent extraordinary measures to address the halt in the economic activity in Puerto Rico, the humanitarian crisis will deepen, and the unmet basic needs of the American citizens of Puerto Rico will become even greater."
TWEET: Letter sent to Majority and Minority leaders asking for more access to federal funding and programs for Puerto Rico's recovery efforts.
Puerto Rico was already struggling before Maria hit, as it faced a more than $70 billion debt. The island has also been dealing with a sharp decline in population; experts fear the drop could steepen after the hurricane further exasperated its financial woes.
"You have to bring people back to Puerto Rico," said Larry McDonald, head of U.S. macro strategies at ACG Analytics. "You can't just watch the ice cube melt."
The storm, coupled with the island's economic problems, have also raised uncertainty for Puerto Rico's bondholders.
Puerto Rico's general obligation bonds plummeted last week after President Donald Trump said the debt would have to be wiped out.
"Puerto Rico bondholder recovery prospects have likely been reduced due to the devastation of the storm. Federal assistance will help in the near term, but further population declines are likely to hinder long-term economic growth," said Chad Farrington, head of municipal bond credit research at Columbia Threadneedle Investments, in a post.