(Adds Acosta quote on creditor groups)
NEW YORK, July 7 (Reuters) - Puerto Rico will meet with its creditors next week for the first time since announcing it wants to restructure its $72 billion debt but an official said on Tuesday the island does not intend to cut principal payments.
Governor Alejandro Garcia Padilla told holders of its $72 billion debt last week that he wants to restructure debt and postpone bond payments.
The creditor meeting will be held on Monday at Citi’s offices.
“We are not saying that the government will not pay,” the head of the island’s Government Development Bank Melba Acosta told reporters on Tuesday. “We are not talking about cutting principal or anything like it.”
Acosta said that the government wants to pay its obligations but that it needs, if creditors allow it, to renegotiate terms and maturities so it has breathing space to make fiscal adjustments, expand the economy and repay debt in its entirety.
“We will be inviting the (creditor) groups with the largest holding of Puerto Rico debt, all types of debt,” Acosta said. “We will be inviting two persons to represent each group.”
Acosta added that they were not intending to have numerous separate negotiations with creditors, but rather with a general group representing each issuer’s creditors.
Acosta said a report by the former IMF economist Anne Krueger which was released a week ago would be explained to creditors as well as the restructuring process and how negotiations will begin.
Victor Suarez, chief of staff in the governor’s office, said the meeting would be live streamed on the internet.
A spokesman for Citi declined comment.
Reporting by a contributor in Puerto Rico; writing by Megan Davies; Editing by Cynthia Osterman