The Government of El Salvador, together with the United States Embassy and the Development Bank of Latin America and the Caribbean (CAF), today announced the largest debt conversion in the world aimed at the conservation of a river and its hydrographic basin. This agreement, promoted by President Nayib Bukele, seeks to allocate significant resources to environmental protection and sustainable development.
The financial operation, valued at $940 million, allows the repurchase of bonds for a total of $1,031 million, resulting in savings of $352 million in capital and interest. The Minister of Finance stressed that these savings will be channeled towards the conservation and restoration of the Lempa River basin, thus benefiting both the ecosystem and local communities.
“All savings generated by this transaction will be applied to support water conservation and security in the region,” said the Minister of Finance. This approach not only represents financial relief for the country, but is also part of a comprehensive liability management strategy that seeks to reduce financing needs in the medium and long term.
The United States Ambassador to El Salvador, William Duncan, expressed his gratitude to the Salvadoran Government for including his nation in this collaborative effort, highlighting that “this historic achievement will benefit new generations.” For his part, the CAF representative in El Salvador, Oscar Avalle, highlighted the importance of coordination between various entities to achieve sustainable development.
The implementation of the project will be carried out by the Ministry of Environment and Natural Resources, together with the Salvadoran Water Authority and organizations such as CRS (Catholic Relief Services) and FIAES. Together, they will work on initiatives to improve water security, promote biodiversity and stimulate economic development through regenerative agriculture.
This ambitious plan has been made possible through the collaboration of key entities, including the US International Development Finance Corporation and JPMorgan Chase Bank, reflecting a firm commitment by the Salvadoran Government to fiscal responsibility and environmental sustainability. .
With this historic debt conversion, El Salvador is positioned as a model in natural resource management, setting a precedent for future conservation initiatives in the region.