§1738p Sale, Reduction, or Cancellation of Qualified Debt to Facilitate Certain Debt Swaps

Summary

The President can sell, reduce, or cancel certain eligible country debts to help carry out debt-for-development or debt-for-nature swaps. The President must set the rules for how those debts may be sold, reduced, or canceled. Sales can only go to buyers who show plans the President approves for using the debt in such swaps. Reductions or cancellations can only happen after a payer shows an approved plan and pays as required. Before acting, the President should talk with the country about how much debt and how it will be used. The country must have been offered the chance to buy the debt under a related offer and must have declined. No more than 40 percent of a country’s qualified debt can be handled this way. The Facility must tell the Commodity Credit Corporation who is eligible and direct the corporation to carry out the actions and update its accounts. Any actions require money approved in advance and proceeds go into U.S. government accounts for repaying the debt. Eligible debt swap: a debt-for-development or debt-for-nature swap.