§1738o Sale of Qualified Debt to Eligible Countries

Summary

The President can sell up to 40% of an eligible country’s qualified debt back to that country. The country must also provide local currency, beyond what it already paid for the debt, equal to either at least 40% of the price it paid or the gap between that price and the debt’s face value. Environmental Fund — a fund set up under section 1738g (for Mexico it can be the Good Neighbor Environmental Fund for the Border). The President must set the sale terms, including what the country pays. Sales only happen if Congress provides money in advance. Sales are not treated as foreign assistance limits. The Facility will order the Commodity Credit Corporation (CCC) to make the sale, the CCC will record it, and sale proceeds go into CCC accounts for the country’s repayment. The President should consult the country first about the amount and how the funds will be used, and should help them set up and run the Environmental Fund.