Quito, Ecuador, January 7, 2025 – The Government of the Republic of Ecuador, supported by the Global Green Growth Institute (GGGI) and other key strategic partners, announced on December 17, 2024, the first debt conversion dedicated to terrestrial and freshwater conservation in the Ecuadorian Amazon. This notable transaction will channel more than US $460 million over the next 17 years, directly for the protection of the Amazon Basin, one of the most biodiverse regions on the planet.
With the implementation of this sustainable finance instrument, Ecuador refinanced approximately US $1.53 billion in global bonds through a US $1 billion loan under improved terms through various credit enhancement mechanisms, freeing up more than US $800 million in liquidity through 2035. This initiative not only will generate financial benefits but also advance environmental objectives—for example, by channeling resources into the implementation of the Amazon Biocorridor Program (BCA) and its conservation initiatives.
Channeled through the Global Trust Fund on Sustainable Finance Instruments (GTF), a program financed by the Government of the Grand Duchy of Luxembourg, GGGI provided the interministerial technical assistance that enabled the Ministry of Economy and Finance (MEF) and the Ministry of Environment, Water, and Ecological Transition (MAATE) to bring this innovative debt-for-nature operation to fruition in record time. Both ministries highlighted GGGI’s role in supporting key components of the transaction—ranging from negotiation advisory for financing agreements, the Conservation Commitments Agreement (CCA), and the Conservation Trust Fund (CTF).
“The Government of Ecuador reaffirms its commitment to conserving the Amazon region by implementing innovative financing mechanisms. (…) Thanks to the coordinated efforts of an inter-institutional team, with the guidance of Enosis Capital as the Technical Advisor and Financial Structuring Agent of the Republic and the Global Green Growth Institute, we have secured credit benefits that link our public finances to concrete actions for the preservation of this invaluable ecosystem.” said Juan Carlos Vega, Ecuador’s Minister of Economy and Finance, in remarks to Bank of America.
Through the BCA’s Conservation Trust Fund “Fondo Del Biocorredor Amazonico Inc”, Ecuador integrates environmental protection measures with economic development, leveraging innovative financing and policy frameworks. The fund will support the Ecuadorian government in:
- Enhancing the management of 4.6 million hectares of existing protected areas.
- Safeguarding an additional 1.8 million hectares of forests and wetlands.
- Protecting 18,000 linear kilometers of rivers.
Key partners such as The Nature Conservancy (TNC), the U.S. International Development Finance Corporation (DFC), the Inter-American Development Bank (IDB), and Bank of America all contributed to ensuring the success of this conversion.
Tatiana Escovar, GGGI’s Andean Representative, highlighted: “GGGI is proud to have supported the Government of Ecuador through the Global Trust Fund on Sustainable Finance Instruments. This commercial debt-for-nature swap demonstrates how visionary public policy, coupled with strong partnerships, can deliver tangible benefits for people, climate, and biodiversity. We look forward to continuing our collaboration as Ecuador charts a path toward inclusive and resilient green growth.”
Looking ahead, the Fondo Del Biocorredor Amazonico Inc will administer and disburse resources averaging US $19 million per year over the next 17 years, while also capitalizing an endowment which is expected to return an additional US $60 million over the same period. GGGI will continue to work alongside its member countries and other partners, offering technical assistance to expand the implementation of sustainable finance instruments around the world.