U.S. to Cancel Part Of Costa Rica’s Debt

May 18, 2007

Costa Rica came one step closer to having part of its debt to the United States canceled in exchange for spending on environmental protection programs during a ceremony last week at the Foreign Ministry.

Through the U.S. Tropical Forest Conservation Act (TFCA), Costa Rica will have the chance to exchange about $12.6 million of its approximately $100 million owed to the United States and put these funds toward programs to protect forestlands.

President Oscar Arias first pitched the idea of debt cancellation to U.S. President George Bush during a visit to WashingtonD.C. in December of last year (TT, Dec. 18, 2006). Bush expressed interest, and the U.S. Treasury Department later deemed Costa Rica eligible to join 11 other countries in qualifying for debt forgiveness through TFCA.

The nonprofits The Nature Conservancy and Conservation International also pledged a combined $2.5 million toward debt cancellation, and they will be involved in the environmental projects in which Costa Rica chooses to invest.

Costa Rica must complete the next phase of the process necessary for debt forgiveness on a relatively tight timeline: it must choose which loans to cancel and which projects to invest in by Sept. 30, U.S. Embassy spokeswoman Elaine Samson explained.

Although Environment and Energy Minister Roberto Dobles called this deadline “ambitious,” he said committees have been created to carry out the necessary tasks and that the project’s focus has already been identified as the southern Osa Peninsula; La Amistad Park, on the Panamanian border; the Tortuguero area, on the northern Caribbean coast; and the northwestern Guanacaste province, including the Rincón de la Vieja area.

Also in attendance at the May 7 ceremony were Finance Minister Guillermo Zúñiga, Foreign Minister Bruno Stagno, The Nature Conservancy Costa Rican program director Zdenka Piskulich and Manuel Ramírez, of Conservation International. Langdale voiced his vote of confidence that Costa Rica will meet the project’s deadline.

“I am pleased by the commitment of the ministers to meet this calendar and I feel confident that all parts will do everything necessary to make this exceptional opportunity a reality,” he said.

 

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