A flooded street in Juana Matos, Puerto Rico, as the country faces dangerous flooding and an island-wide power outage following Hurricane Maria © AFP

Puerto Rican authorities were on Saturday scrambling to evacuate as many as 70,000 people downstream of a failing dam in the north-west of the US territory.

The government confirmed that the dam had failed after warning of an “imminent break” brought on by flooding by Hurricane Maria during a Friday afternoon inspection.

The National Weather Service in San Juan issued a flash flood emergency on Friday telling people in all areas surrounding the Rio Guajataca downstream of Guajataca dam to leave.

“This is an EXTREMELY DANGEROUS SITUATION. Busses are currently evacuating people from the area as quickly as they can,” the NWS said in a tweet.

Authorities were still trying to assess the scale of devastation days after Maria plunged the island into darkness and left water undrinkable and the majority of its 3.4m residents without the means to communicate.

At least six people were confirmed dead, a figure that was expected to rise in the coming days, after the worst storm to hit Puerto Rico in decades flooded vast parts of the Caribbean archipelago.

The island was already in dire financial straits before it was battered by two storms this September, with more than two-fifths of residents living in poverty and a mass exodus to the US mainland depleting its population.

With the threat that Prepa, the island’s power authority, may be unable to restore electricity for months, fears are building over the possibility of waterborne diseases affecting the island.

“It depends on the damage to the infrastructure,” Puerto Rico governor Ricardo Rosselló said of the power outages in an interview on CNN. “I’m afraid it’s probably going to be severe. If it is . . . we’re looking at months as opposed to weeks or days.”

The Centers for Disease Control said on Friday that it did not expect a cholera outbreak in Puerto Rico. There was no evidence of the disease on the island before the storm arrived and such illnesses are rare in developed countries even after a natural disaster. “We stand ready to respond if cholera appears,” said Renee Funk, CDC’s hurricane incident response manager.

Roughly 65 per cent of the island was without water and the central government had so far been unable to reach southern towns, which were among the hardest hit by Maria, one government official said. He added that in conjunction with the Federal Emergency Management Agency, leaders would fly by helicopter to assess the damage in the south on Friday.

Even within the government, there was trouble locating policymakers on the island, the person added.

More than 95 per cent of cell phone sites in Puerto Rico were knocked out by the storm, and the chairman of the Federal Communications Commission warned that getting its cellular network “up and running will be a challenging process, particularly given the power outages”.

Flooded homes in Juana Matos, Puerto Rico © AFP

Maria was still expected to dump a further three to six inches of rain on Puerto Rico, according to the National Hurricane Center. The catastrophic storm was producing 125 mile per hour winds as it passed north-east of Turks and Caicos on Friday, the Miami-based organisation said. It was expected gradually to weaken over the weekend and veer away from the US mainland and into the Atlantic Ocean.

The full financial consequences of Hurricane Maria are yet to be known, but policymakers and investors expect the damage to significantly slow economic activity across the island of Puerto Rico. That could have an effect on negotiations between creditors, retirees and the Puerto Rican government, which is seeking to slash its more than $120bn of bond and pension obligations.

A financial oversight board established by Congress last year to oversee the island’s restructuring approved up to $1bn in changes to the Puerto Rican budget to pay for relief efforts. The chair of the board, Jose Carrion, said the group stood ready to approve increases to the US territory’s budget to respond to the hurricane.

Jim Millstein, the adviser to Puerto Rico’s previous administration and the former chief restructuring officer at the US Treasury, said there was no real parallel for a natural disaster of the magnitude of Maria upending a restructuring.

“Unless the Feds pick up 100 per cent of the relief, recovery and rebuild costs . . ., Maria has left Puerto Rico with higher costs and therefore less surplus available for debt service than when the Fiscal Plan was approved.”

Bonds backing the power authority that mature in 2037 slid to their lowest level of the year, while general obligation debt due in 2041, backed by the Puerto Rico constitution, traded hands at 47 cents on the dollar on Thursday, an all-time low.

Eileen Lainez, FEMA’s deputy director of public affairs, said on Friday that the government’s top priority is bringing aid to Puerto Rico and the US Virgin Islands while “aggressively working to restore power” and the ability to move goods and rescue workers through ports.

More than 3,700 federal employees are supporting rescue and recovery efforts in the hurricane-battered islands, she said.

Tom Price, the US Department of Health and Human Services secretary, has declared a public health emergency in Puerto Rico and the US Virgin Islands and has deployed specialised disaster medical assistance teams to help storm victims.

The US Energy department is co-ordinating with FEMA and the power industry on mutual aid for Puerto Rico, and transport of crews from NY Power Authority, to support damage assessments. FEMA also is working with the Army Corps of Engineers and the Defense Logistics Agency to provide generators for critical infrastructure, including hospitals.

The corps of engineers has completed several temporary power installations on Puerto Rico and the US Virgin Islands and is sending additional generators.

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