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Puerto Rico to Default on $36Mln Debt on January 1

© AP Photo / Ricardo ArduengoIn this May 4, 2012 photo, the flags of Puerto Rico and the U.S. wave behind an English one-way traffic sign in Guaynabo, Puerto Rico, one of only a few places in Puerto Rico with street signs in English
In this May 4, 2012 photo, the flags of Puerto Rico and the U.S. wave behind an English one-way traffic sign in Guaynabo, Puerto Rico, one of only a few places in Puerto Rico with street signs in English - Sputnik International
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Government Development Bank for Puerto Rico said that Puerto Rico will not be able to repay a debt scheduled for January 1, 2016, which will lead the Commonwealth to default for a second time in its history.

In this Aug. 2, 2015, file photo, a homeless man stands in front of a closed down business in Puerta de Tierra in the outskirts of Old San Juan, Puerto Rico - Sputnik International
Puerto Rico Nears Big Default as January 1 Deadline Looms
WASHINGTON (Sputnik) — Puerto Rico will not be able to repay a debt scheduled for January 1, 2016, which will lead the Commonwealth to default for a second time in its history, Government Development Bank for Puerto Rico (GDB) said in a press release.

“PRIFA [Puerto Rico Infrastructure Financing Authority] will not have sufficient funds to make a full payment on its special tax revenue bonds, Series 2005A-C and Series 2006, on January 1, 2016, for a total amount of approximately $36 million that is not expected to be paid,” the release stated on Wednesday.

Puerto Rico is also expected to miss a payment on $1.4 million of its Public Finance Corporation bonds.

However, the GDB announced it will make full principal and interest payments on the debt guaranteed by the Commonwealth, which amounts $434 million. The $10 million debt on outstanding GDB notes will also be covered, according to the statement.

In August, Puerto Rico defaulted on its $73 billion debt and has been beset by financial problems since.

President Barack Obama has established an interagency task force on Puerto Rico to leverage available US federal assistance to help the Commonwealth, but the White House has stated it does not envision offering a bailout.

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