Over the years, as we’ve evaluated the budgetary standing of states, counties and cities, a surprising number of people have asked us why we haven’t covered the territories as well.

The answer has always been that we lacked the capacity. But at the end of June, the Government Accountability Office (GAO) came out with a U.S. Territories report that focused on public debt and their economic outlook, shedding bright light on this generally under-reported area.

The news the GAO has about the five permanently inhabited territories, is almost unremittingly negative. It sums the situation up as follows: “The territories face challenges to economic growth, which can make it harder for them to secure or repay debt. These include the high cost of importing goods and energy, population loss, and extreme weather events that have hurt industries like tourism.

“Some of the territories are also struggling to fund their pension and other postemployment obligations for benefits such as health care and life insurance.” 

Here are the details the report provides about each of the territories taken verbatim from the GAO Report:

Commonwealth of Puerto Rico: As of June 30, 2022, total public debt outstanding was $52.8 billion, 47 percent of gross domestic product (GDP). Negotiations and litigation to restructure the electric utility debt are ongoing, and the utility has been struggling to make its pension payments in the meantime.

Guam: As of September 30, 2023, total public debt outstanding was $2.5 billion. 2023 GDP data are not available, but the fiscal year 2022 total public debt was $2.6 billion, about 38 percent of GDP. Its tourism industry has not returned to pre-COVID-19 levels, but U.S. military investment is bolstering the economy.

U.S. Virgin Islands (USVI): As of September 30, 2021, total public debt outstanding was more than $2.2 billion, or 50 percent of GDP. USVI's electric utility has critical financial and operational problems, which create challenges for residents and can inhibit economic development.

Commonwealth of the Northern Mariana Islands (CNMI): As of September 30, 2021, total public debt outstanding was $121.1 million, about 13 percent of GDP. Its tourism-reliant economy has limited prospects for recovery, and the challenges to meet its financial obligations have deepened.

American Samoa: As of September 30, 2023, total public debt outstanding was $145.4 million. While 2023 GDP data are not available, the fiscal year 2022 total public debt was $152.4 million, about 18 percent of GDP. Its continued economic reliance on a single tuna cannery presents risks.

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