Reshoring via Development Planning

Recovery from the massive damage to the Puerto Rican island has been slow.  At the same time, there has been little progress in bringing back into the US the manufacturing of many important classes of drugs. These two problems may create an opportunity!

Few should argue with the fact that it is past time to allocate government resources to effectively rebuild the electrical grid in Puerto Rico to support the peoples needs and to concurrently add sufficient lower cost electricity in a manner to attract light manufacturing in general, and drug manufacturing in particular, to the island. One would hope that the addition of a source of low cost power might kick start some development without other government actions. But, since the island's economic progress has been very slow to date, an group of investment incentives may be required.

There are certainly options for new and improved sources of electrical power. Whether the population would accept a series of new modular nuclear power plants, may be an open question. If not, LNG maybe the operative approach required to add to the electrical generation capacity required to revitalize the island's economy. It would be advisable also to do the extra work to put all transmission lines underground to minimize future weather related issues. But, this strategy may take more time than is currently prudent. Let's ask the Puerto Rican leaders and the population what makes sense and then act with urgency to make Puerto Rico 's utility services part of a very attractive location package for new plant investments that will improve overall US healthcare supplies.

To incentivize US pharmaceutical or related manufacturers to relocate to the island, it could be setup as a corporate tax fee zone for a three decade period.  This corporate tax benefit would be for all businesses located in Puerto Rico within designated SICs based on the US commercial assessments.  There certainly could be initial support for employee training and other limited start-up government programs but these should be short-term and ultimately the responsibility of the business community.  With the right approach, the added employment and island GDP growth should be significant and sustainable.  And ... with the addition of each new plant the shrinking US dependence on foreign drug and other suppliers should be seen as a major benefit for national health and security.

Let's do the right things for the Puerto Rican people and at the same time take a giant step toward reducing the unacceptable US dependence on foreign drug producers.  The administrative agencies and Congress should lay the foundation in the near term for action to concurrently resolve these two problems in advance of finding a way to prioritize this important development plan in the legislative process for the fiscal year starting in October, 2025.