October 21, 2008
HP-1226

Debt-for-Nature Agreement to Conserve Peru's Tropical Forests

Washington,  DC--The Governments of the  United States of America  and the Republic  of  Peru  have announced an agreement to reduce  Peru's debt payments to the  United States  by more than $25 million over the next seven years.   In return, the Government of Peru has committed these funds to support grants to protect the country's tropical forests. 

Secretary Paulson welcomed the agreement with the Government of Peru under the U.S. Tropical Forest Conservation Act.   "This agreement will build on the success of previous U.S. Government debt swaps with  Peru  and will further the cause of environmental conservation in a country with one of the highest levels of biodiversity on the planet.   Such debt-for-nature agreements are a successful model of government and citizen cooperation to improve and expand conservation efforts," he said.

Peru  is one of the most biologically rich countries on earth.   Funds generated by the debt-for-nature program will help  Peru  protect  tropical rain forests of the southwestern  Amazon  Basin  and dry forests of the  Central Andes.   These areas are home to dense concentrations of endemic birds such as the Andean Condor and Parakeet; primates including the Peruvian Yellow-tailed Woolly Monkey and Howler Monkey; other mammals such as the Jaguar, Amazonian Manatee, Giant Otter, Spectacled Bear and Amazon River Dolphin; as well as unique plants.  Rivers supplying water to downstream settlements originate in many of these forests, and people living in and around the forests depend on them for their livelihood and survival.

This agreement with  Peru  was made possible by the innovative Tropical Forest Conservation Act of 1998.   It will complement an existing TFCA debt-for-nature program in Peru dating from 2002, a 1997 debt swap under the Enterprise for the Americas Initiative, and the United States-Peru Trade Promotion Agreement, which includes a number of forest protection provisions.   With this agreement,Peru  will be the largest beneficiary under the Tropical Forest Conservation Act, with more than $35 million generated for conservation. 

The new  Peru  agreement marks the 14^th  Tropical Forest Conservation Act pact, following agreements with  Bangladesh,  Belize,  Botswana,  Colombia,  Costa Rica,El Salvador,  Guatemala,  Jamaica,  Panama  (two agreements),  Paraguay  and thePhilippines, as well as an earlier agreement with  Peru.   Over time, these debt-for-nature programs will together generate more than $188 million to protect tropical forests.