Puerto Rico to cut services or default

Puerto Rico’s government says it is running out of money and will have to cut back or default on its debts.
Source: AAP
SBSPuerto Rico’s government says it will have to cut back on public services or default on debts before the end of the year because it is running out of cash.

The Government Development Bank said in a financial filing late on Friday night that the US territory had a $US370 million ($A517.81 million) overdraft as of September 30 and burned through a $US400 million emergency loan from a group of public corporations to keep government operating.

It also cut revenue estimates for the current fiscal year by $US355 million because of weaker than expected collections.

Officials are considering reducing employee work schedules by two days a week but warn the government may have to default on debt payments to maintain essential services.

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