Puerto Rico’s Push for Jones Act Exemption Under Fire

The recently proposed five-year plan that would allow non U.S.-flagged ships to transport cargo between the U.S. mainland and Puerto Rico would undermine or possibly even sabotage this indebted unincorporated U.S. territory’s assistance package, according to Tom Allegretti, American Maritime Partnership Chairman.

The restructuring plan, released by Puerto Rican Gov. Alejandro Garcia Padilla, suggests that Jones Act, the law under which all cargo transported between U.S. territories must be carried by U.S.-flagged ships, built in U.S. shipyards and manned by U.S. crews, is increasing cost of goods in Puerto Rico by driving up the transport costs.

Puerto Rico proposed the exemption as the commonwealth is trying to tackle a USD 72 billion bond debt.

However, Allegretti claims that the Jones Act has been erroneously criticized this past month by those who want to tie the debt crisis in Puerto Rico to the maritime industry.

“Some in Puerto Rico have suggested that a Jones Act exemption be included in the legislative package under the erroneous theory that the Jones Act is bad for Puerto Rico. But here’s the kicker: If Congress did that — include an anti-Jones Act amendment in the package — the chances of the overall package getting enacted into law would diminish. That’s because the presence of an anti-Jones Act amendment would reduce or subtract the number of Members of Congress who would vote for the overall bill. So Puerto Ricans would be undermining — and maybe even sabotaging — their own assistance package by including an anti-Jones Act amendment in it,” said Allegretti.

The proposed exemption was also criticized by the civilian lobbying group The Navy League of the United States which said that “any weakening of the Jones Act would weaken national and economic security.”

Last December, the U.S. Congress enacted a strongest endorsement of the Jones Act in resolutions included in the National Defense Authorization Act of 2014.

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