Historic Debt-for-Nature Swap Protects Guatemala's Tropical Forests

10/1/2006

The Nature Conservancy, Conservation International Support Agreement

Washington, DC � Conservation International (CI) and The Nature Conservancy have joined the governments of the United States and Guatemala in a debt-for-nature swap that will provide more than $24 million to help protect critically threatened tropical forests in the Central American country.

Under debt-for-nature swaps, a country�s foreign debt is forgiven in exchange for its government�s commitment to directly support conservation work. According to the agreement signed Sept. 8, Guatemala will invest approximately $24.4 million in local currency over the next 15 years for conservation work in four designated areas.

The U.S. Government contributed approximately $15M, appropriated under the Tropical Forest Conservation Act (TFCA), toward the cancellation of some of Guatemala�s debt, while CI and The Nature Conservancy each contributed an additional $1 million.

This is the largest debt-for-nature swap ever under the TFCA, which authorizes such agreements to help partner countries generate local economic activity and build capacity for protecting tropical forests.

�This is how modern conservation works, with partnerships involving all stakeholders to protect crucial ecosystems that sustain life on Earth,� said Peter Seligmann, the CI chairman and CEO. �We are proud to help the Guatemalan people conserve tropical forests essential to their well-being and the overall health of the planet.�

Steve McCormick, president and CEO of The Nature Conservancy, called the scope of the deal astonishing.

�The areas protected in this agreement lie in the heart of Mayan civilization, and they are home to jaguars, scarlet macaws, harpy eagles, and countless other species,� McCormick said. �Working collaboratively with public, private, and nonprofit partners, we have been able to protect some of the most threatened natural areas on earth, to the enormous benefit of communities that depend on them for survival.�

The Nature Conservancy�s contribution included $500,000 from American Electric Power (AEP), and an additional $100,000 raised by the Maine chapter of The Nature Conservancy. CI�s contribution included $700,000 from its Global Conservation Fund, which finances the creation and long-term management of protected areas. In addition, Sandra Warren and her team in White & Case served as pro bono legal counsel to CI and The Nature Conservancy.

The agreement designates approximately $19.5 million to finance grants for eligible non-governmental projects over the next 15 years, and the remaining $4.9 million creates a permanent conservation trust fund that will generate interest income for further grants. Under the agreement, every $1 contributed by the U.S. Treasury, the Conservancy, and CI brings $1.4 worth of conservation on the ground in Guatemala, where many tropical forest areas are under threat from unmanaged use and conversion to other less sustainable economic activities.

This funding will help conserve some of Guatemala�s most important natural heritage ranging from high altitude cloud forests, tropical and sub-tropical rain forests, dry forests and coastal mangroves, which are home to hundreds of species of songbirds and waterfowl that migrate between the United States and Guatemala, as well as many rare and endangered species, including the resplendent quetzal bird, jaguars and margays. At the same time, these areas are vital for local and national economic development in terms of water production, forestry and tourism.

Money from the debt-for-nature swap will focus on four priority areas:

  • The Cuchumatanes Region � habitats located in Todos Santos Cuchumatan, Cruz Martin, Pepajau Madgalena and other areas that are home to five priority species of amphibians determined by the Alliance for Zero Extinction (AZE).
  • The Maya Biosphere Reserve � home to the Maya Forest, a critical habitat that is integral to cultural heritage, countless species, and the well-being of communities that rely on the forest.
  • The Motagua/Polochic System � one of the most biologically important regions in Guatemala with many species found nowhere else in the world.
  • The Western Highlands Volcanic Chain � a critical migratory bird route and home to many plant and animal species unique to Guatemala.

To be eligible for debt-for-nature swaps under the TFCA, developing countries with critically important tropical forests must meet certain political and economic requirements. Funding for such swaps is provided by the U.S. Treasury, private individuals and nonprofit organizations.

Other countries that have entered debt-for-nature swaps under the TFCA include Panama, Jamaica, Colombia, and Peru. The contributions of non-governmental organizations to debt-for nature swaps total over $9 million. A total of 11 TFCA agreements have been signed which will generate more than $125 million over 10-25 years to protect tropical forests.

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The Nature Conservancy is a leading international, nonprofit organization that preserves plants, animals and natural communities representing the diversity of life on Earth by protecting the lands and waters they need to survive. To date, the Conservancy and its more than one million members have been responsible for the protection of more than 15 million acres in the United States and have helped preserve more than 102 million acres in Latin America, the Caribbean, Asia and the Pacific.

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