Geography
and climate
Puerto Rico is the smallest of
the islands in the Greater Antilles group; it has
a total area of 3,435 square miles. To the north
and east of Puerto Rico lies the Atlantic Ocean,
to the south, the Caribbean Sea, and to the west,
the Mona Passage.
The climate of Puerto Rico is
tropical, with temperatures ranging from an
average of 70 degrees F (21 C) in the winter to
about 80 degrees F (27C) in the summer.
Temperatures and rainfall vary considerably with
the locality. Rainfall averages about 60 inches
in the San Juan area.
The capital city, San Juan,
located on the north coast, is the business,
social and cultural center of the country. About
30 percent of the country's total population
lives in San Juan and the adjacent
municipalities. Ponce, the island's second
largest city, is located on the south coast of
the island.
International time
Puerto Rico is on Atlantic
Standard Time (AST), which is one hour later than
Eastern Standard Time (EST) and four hours
earlier than Greenwich Mean Time (GMT).
Currency
The monetary unit is the U.S.
dollar (US$).
Population
3.9 million U.S. citizens. A
population density of some 1,100 inhabitants per
square mile is the fifth highest in the world.
Government
Local government is based on the
principle of separation of powers, with
Executive, Legislative and Judicial Branches.
Mirrors the U.S. system. Elections for governor,
mayors and legislators are held every four years.
Borders
Puerto Rico is under the U.S.
customs jurisdiction. Borders are open between
P.R. and the U.S., allowing for free movement of
people and merchandise.
Economy
The transformation of Puerto
Rico's economy from agricultural to industrial
has been fostered by the Economic Development
Administration of the Commonwealth of Puerto
Rico, better known as FOMENTO. The development of
manufacturing in Puerto Rico has evolved to where
Puerto Rico no longer is considered an agrarian
economy. The "Operation Bootstrap"
program, implemented in the 1940's, primarily
stressed manufacturing. Over 2,000 factories have
been established in Puerto Rico under the FOMENTO
program. The Tax Incentives Act of 1997 enhanced
existing tax sparing provisions and other kinds
of non-cash incentives to keep Puerto Rico
competitive in the global economy.
Basic Resources
Puerto Rico has limited natural
resources. There is, a variety of minerals, such
as sand, marble, clay and salt.
Major Industries
The pharmaceutical industry
(predominantly subsidiaries of U.S.
corporations), petrochemicals, apparel,
electronics, and food processing industries are
well developed. Tourism is essential to the
island's economy.
Potential Growth Area
In recent years, the Puerto Rico
Government has fostered the development of the
agricultural industry as part of the general
program for substitution of imports. Agricultural
products, specifically coffee, tobacco, bananas,
dairy products, and poultry are increasingly
important contributors to the island's GNP. Also,
emphasis is now being placed on service
industries.
Changes in Section 936
The U.S. Congress repealed
Section 936 of the U.S. Internal Revenue Code in
August, 1996, with a grandfather clause retaining
its benefit for ten years on existing
corporations. Section 30A was created to
substitute Section 936. It essentially retains
the wage credit component of Section 936.
New firms may opt to incorporate
themselves in Puerto Rico as "controlled
foreign corporations" and receive the tax
benefits provided by Section 901 of the U.S.
Internal Revenue Code.
Per Capita Income
GNP was $28.37 billion in fiscal
year 1995. Per capita personal income is
approximately $8,000.
Unemployment
Between 13% and 14%.
Federal Relations
Because of its status as a
commonwealth associated with the United States,
Puerto Rico enjoys authority over its internal
affairs, even though it falls under the
territorial clause. Such authority includes
fiscal autonomy; i.e., it administers its own tax
system, and most federal taxes are not levied on
income earned in Puerto Rico, with the exception
of benefit-related taxes, such as Social
Security, Medicare, and unemployment insurance.
T'he federal government retains
control of customs, interstate trade, operation
of the Post Office, the Coast Guard, licensing of
radio and TV stations, and other areas generally
controlled by the federal government in the
United States. Federal courts are maintained to
adjudicate the civil and criminal matters that
are in the province of the United States
government.
Voting Rights
Puerto Ricans do not vote in the
U.S. national elections while residing on the
island, neither do other U.S. citizens who
relocate to Puerto Rico. As U.S. citizens,
however, the full voting rights of Puerto Ricans
are recognized when they move to the U.S.
mainland.
Puerto Rico participates in the
national political process by sending delegates
to the Democratic and Republican national
conventions.
Congressional Representation
Puerto Rico is represented in the
U.S. Congress by a Resident Commissioner, who
sits in the U.S. House of Representatives. The
Resident Commissioner does not vote on the House
floor, but votes in committees and caucuses to
which he belongs. Puerto Rico's Resident
Commissioner holds office for a four-year period,
being elected at the time of general elections in
Puerto Rico.
Politics
Currently a three-party system,
but essentially bipartital. Political alignment
follows status preference; the Pro Independence
Party (PIP), the pro-commonwealth Popular
Democratic Party (PDP) and the pro-statehood New
Progressive Party (NPP). Since 1968, the NPP and
the PDP have alternated power, the last two
elections being won by NPP.
Banking System
T'he banking system in Puerto
Rico is an integral part of the banking system of
the U.S.
Military Service
As volunteers and under the
Selective Service System, Puerto Ricans have
served in the U.S. Armed Forces and have fought
in all U.S. wars since World War 1. The Roosevelt
Road Naval Base, located in Ceiba (east coast),
is a cornerstone of the US Atlantic defense
system. The U.S. Army South Command (USARSO) will
be established in Puerto Rico in late 1999.
Transportation
San Juan is one of the world's 10
busiest container ports and a major hub for
Caribbean maritime shipping. San Juan's Munoz
Marin International Airport was among the top 33
passenger airports in the U.S. and ranked 21st in
cargo handling in 1994.
Language
Spanish is the principal
language, although English is used extensively in
the business community.
Religion
The Roman Catholic religion is
predominant, but there is no prohibition against
the practice of any other religion. Virtually all
major religious denominations exist in Puerto
Rico.
Education
Puerto Rico spends approximately
40 percent of its budget on education, which is
mandatory up to age 16. There is a
government-supported system of free education
through high school, plus a broad program of
adult and vocational education. Puerto Rico has
various fully accredited institutions of higher
learning (Private and State supported).
Communication
Businessmen will find much the
same range of commercial communication services
available in Puerto Rico as in the United States
(long-distance access, fax services and internet
access).
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