A mounting debt crisis. Restructuring and repayment. Calls for concessions from creditors.
It sounds like Greece but as eyes have been watering over the disintegrating economic crisis there, a similar situation has been developing in Puerto Rico.
The Caribbean island is heading along the same path as the Hellenic Republic, with what legislators see as an unserviceable mountain of debt. Like Greece, it needs extra funds to be able to pay off interest, sort out its wage bills and shore up the banks.
But there is one key difference: Greece has been able to go to international institutions – the so-called ‘troika’ of the European Commission, European Central Bank and International Monetary Fund – for loans. As an unincorporated US territory, Puerto Rico cannot just head off looking for global financial aid. And Washington has also been holding firm over approving a federal bailout.
Something has to give. Will DC relent? Will lenders take a hit on the money they are owed?
Greek prime minister Alexis Tsipras has been in combative mood over the last few months, backed up by steely minsters trying to play hardball against a rising number of missed due dates for debt repayments and increasingly gnarly European and IMF creditors.
Puerto Rico’s governor seems set for a similar face-off as it is unlikely the people who have been lending the US commonwealth money will willingly accept reductions on their repayments. The fight would be over an attempt by Alejandro Garcia Padilla to restructure the island’s $73bn debt that could see creditors ending up repaid less than they are owed.
There are other similarities. The two cases suffer from being out on the fringe, geographically and politically. Greece has been characterised negatively as a work-shy Mediterranean siesta state, that needs a cultural shift to organise its economy, a political shift to end austerity, and pan-European support and agreement to help it remain in the eurozone.
Puerto Rico is also a margin nation. It is not a sovereign state, but nor does it have full US statehood. On the international scene it sends a team to the Olympic Games but does not send an ambassador to the United Nations.
Greece has been setting unwanted records recently, joining the three dubiously managed countries of Somalia, Sudan and Zimbabwe in still having outstanding debts to the International Monetary Fund.
Puerto Rico cannot become a member of that particular basement club but it has a pretty parlous economic state of affairs. It seems unlikely to be able to declare bankruptcy or deal with its debts in a way that pleases all sides. San Juan might have to hope for a bailout from above, and if that sounds familiar, it is because that is how the whole Greek crisis began – an island nation seeing the tides of debt lapping at the feet of its people.