US Treasury Signs 'Debt For Nature' Agreement With Costa Rica

by Mike Godfrey, Tax-News.com, Washington

18 October 2007

It was announced on Wednesday that the governments of the United States of America and Costa Rica, the Central Bank of Costa Rica, Conservation International, and The Nature Conservancy have concluded agreements to reduce Costa Rica's debt payments to the United States by $26 million over the next 16 years.

In return, the Central Bank of Costa Rica has committed to pay these funds to support grants to non-governmental organizations and other groups, to protect and restore the country's important tropical forest resources.

According to the US Treasury: "The debt for nature program was made possible through contributions of over $12.6 million by the US Government under the Tropical Forest Conservation Act of 1998 and a combined donation of over $2.5 million from Conservation International and The Nature Conservancy."

The Tropical Forest Conservation Act provides opportunities for eligible developing countries to reduce concessional debt owed the United States while generating funds to conserve their forests.

The program with Costa Rica, the largest of the funds created to date, marks the 12th established under the Bush Administration, following agreements with Belize, Botswana, Colombia, El Salvador, Guatemala, Jamaica, Panama (2), Paraguay, Peru and the Philippines. These programs, together with one established with Bangladesh in 2000, will generate more than $163 million over 10-25 years to protect tropical forests.

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