U.S. Department of the Treasury

(Archived Content)

FROM THE OFFICE OF PUBLIC AFFAIRS

Deal will reduce Panams debt payments to the U.S. by$10 million dollars over the next fourteen years.

On July 10, 2003 American Ambassador to Panam, Linda Watt on behalf of the United States, Finance Minister Norberto Delgado on behalf of the Republic of Panam, and Robert De Jhong, Director of the Central American Division of The Nature Conservancy signed agreements made possible by the Tropical Forest Conservation Act (TFCA) that reduce Panams debt payments to the U.S. by $10 million dollars over the next fourteen years. In return, the Government of Panamhas committed to funding local conservation projects that will amount to ten million dollars over the next fourteen years for the protection and conservation of the Chagres River Basin.

The Chagres National Park is a 318,000 acre national protected area covering the Chagres River basin that provides over 50% of the water necessary for the operation of the Panama Canal as well as drinking water for the two largest cities in the country - PanamCity and Colon. In addition, as the U.S. is one of the largest users of the canal, and the canal itself moves more than 5% of world trade, preserving the watershed is of material economic importance to the USG.

The Chagres National Park is also home to endangered species such as jaguars, mantled howler monkeys and anteaters. It is also a bird sanctuary for more than 560 species, including the harpy eagle the largest eagle in the world and Panams national bird. For these reasons the permanent conservation of this area is of critical importance to the economy, health and natural resources of Panam.

The funds resulting from this agreement will be channeled to two sources: funding conservation activities in the Chagres National Park over the next fourteen years, and creating a permanent endowment to provide sustainable funding to the park.

This agreement complements ongoing environmental programs being provided to Panamby the U.S. Agency for International Development (USAID) and will be managed by a group including the government of Panam, local non-governmental organizations including Fundacin Natura, the USAID mission to Panam, the American Embassy and The Nature Conservancy.

Todays agreements mark the third debt-for-nature swap by the U.S. under the TFCA, and was made possible through a grant of $5.6 million from the United States government in combination with a financial contribution of almost $1.2 million from The Nature Conservancy. For every dollar in US budget funds, the U.S. government was able to leverage almost two dollars in funds for tropical forest conservation in Panam.

Panamis the sixth country to benefit from programs under the TFCA. Bangladesh, Belize, El Salvador, Peru, and the Philippines are the others. The TFCA was enacted in 1998 to provide eligible developing countries the opportunity to reduce their concessional debts owed to the United States while at the same time generating funds for activities to conserve tropical forests.

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