§2431f Authority to Engage in Debt-for-nature Swaps and Debt Buybacks

Summary

The President may sell, reduce, or cancel certain U.S. concessional loans or credits to make debt-for-nature swaps or to let a country buy back its own debt, but only under rules in this section. For a debt-for-nature swap, an approved purchaser must give a plan the President finds acceptable showing how the sale or cancellation will fund the activities listed in section 2431g(d). If the loan was made to an eligible country, the President must talk with that country first about how much will be sold, cut, or canceled and how the money will be used. If an eligible country is buying back its own debt, the country must add local currency equal to at least the lesser of 40% of the price it paid or the difference between price paid and the debt’s face value, and use that money for the activities in section 2431g(d). All actions depend on advance appropriations to cover the government’s cost. The President will set the exact terms. The Facility must notify the main U.S. agency or the Commodity Credit Corporation of approved purchasers and direct them to carry out the transactions, and those agencies must adjust their accounts. U.S. appointees must sit on the body that oversees grants from any swap or buyback. Money from these sales or cancellations must go into the U.S. government account(s for repaying the loan).